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NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)
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NASSCOM GIC Conclave 2012: Unlocking the full potential of GICs - Shailesh Kekre (Session 6a)

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  • 1. Unlocking the full potential of GICsFindings from operations excellencebenchmarking NASSCOM GIC Conclave, New Delhi March 21, 2012 CONFIDENTIAL AND PROPRIETARY Any use of this material without specific permission of McKinsey & Company is strictly prohibited
  • 2. GIC Chennai chapter led the effort on operations excellence Operations excellence Objective  Benchmark the participating GICs to assess performance on operations excellence  Identify key success factors, issues and themes on operations excellence Benchmarking  Collect data from 11 GICs using our proprietary framework – peer set P360  Compare with 17 other GICs in database covering 800+ processesSOURCE: McKinsey McKinsey & Company | 1
  • 3. 1 GICs continue to drive high client satisfactionOnshore stakeholder satisfaction on overall performancePercent 83 79Operations 73 72 70 70 69IT services 68 2009 2010 2011 2012SOURCE: McKinsey P360 benchmarking McKinsey & Company | 2
  • 4. 2 Scale and relevance to global operations likely to increasePercent of stakeholder responseHow is your offshore penetration in India How is your offshore skill complexity mixlikely to change in the next 2-3 years? in India likely to change in 2-3 years? Increase 16 67 by >30% Increase in skill complexity mix Increase 52 by 15-30% Maintain current 29 skill complexity Maintain current 29 mix levels of offshoring Decrease from 3 Decrease in 4 current offshoring skill complexity level mixSOURCE: McKinsey P360 benchmarking McKinsey & Company | 3
  • 5. 3 However, this growth will be accompanied by increase in network complexityIncreasing footprint in India More globalized delivery Increasing ownership mixNumber of GICs (%) Number of GICs (%) Number of GICs (%) In-house>=3 cities >=3 and 21% 28% 33%in India countries outsourced 45% 41% 57% Primarily1-2 cities 1-2 79% 72% 67% in-housein India Countries 55% 59% 43% 2008 2012 2008 2012 2008 2012SOURCE: McKinsey P360 benchmarking McKinsey & Company | 4
  • 6. 4 Ongoing cost leadership and ownership of business # Top two areas to focus outcomes will become most important priorities Onshore stakeholder priorities from offshore operations Relative focus across five areas (percent) Banking, Telecom Manufac- insurance & hi-tech turing Cost and productivity Ownership of business outcomes Quality of delivery Footprint concentration risk Scalability and flexibility in operationsSOURCE: McKinsey P360 benchmarking McKinsey & Company | 5
  • 7. 5 Wide variation in performance; top performers excel RULES-BASED DATA (GICs > 1,000 FTEs) consistently Performance on key outcomes Fully loaded FTE cost Net productive FTE time Quality Average indexed to 100 Average indexed to 100 SLA compliance % GIC A 80 +25% 138 +35% 98 GIC B 82 142 99 GIC C 85 135 98 GIC D 88 138 96 GIC E 93 119 95 GIC F 97 104 97 GIC G 97 101 93 GIC H 98 105 94 GIC I 99 96 95 GIC J 100 89 93 GIC K 102 95 96 GIC L 107 82 96 GIC N 107 74 94 GIC O 111 83 92 GIC P 112 85 95 GIC Q 117 79 96 GIC R 118 93 89 GIC S 121 85 92SOURCE: McKinsey P360 benchmarking McKinsey & Company | 6
  • 8. 6 There are 6 imperatives for GIC leaders to drive the next wave of operations excellence 1 2 Manage Think multiple network, not governance site archetypes 6 3 Align operations to Manage risk business priorities 5 4 Build Streamline capability to offshore drive end- platform to-end optimisationSOURCE: McKinsey McKinsey & Company | 7
  • 9. Key messages 1. 1 India based GICs continue to deliver strong performance on client satisfaction 2. 2 GICs expected to grow further on both scale and skill, given its strong and unique proposition 3. 3 Increased footprint is however placing a new set of challenges on managing network complexity 4. 4 Further, emphasis on delivering business outcomes while continuing to drive cost and productivity efficiencies on the rise 5. 5 While leading GICs excel consistently across multiple parameters, performance variation is large 6. 6 Next wave of operations excellence will require GICs to build distinctive skills in 6 areasSOURCE: McKinsey McKinsey & Company | 8

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