There is a lot of "press" out there that talks about the pros and cons of captives in India. There is one view point that captives are unnecessary, and yet another that captives are a much better bet than outsourcing to a third party. As always, value lies in the eyes of the beholder and this ppt provides an evaluation framework for someone wanting to make a decision

1. ANILESH SETH’S OFFSHORE CAPTIVE EVALUATION CHART
www.slideshare.net/anilesh
www.captivesinindia.blogspot.com
DOES A CAPTIVE MAKE
SENSE FOR MY
ORGANIZATION?

2. The matter in these slides represents my views based upon my
experiences and inputs I have received from several folks I have
been in touch with over the years.
I assume no responsibility for the success or failure of any outcome
for anyone adapting or adopting anything I have mentioned herein.
Take your own risks and your own decisions.
That being said, I am licensing the use of these slides as a
creative commons license. You can use these with no obligation – just be
sure to insert your appreciation on my blog
www.captivesinindia.blogspot.com and
share your work as per the Creative Commons
License at www.creativecommons.org/licenses/by-sa/3.0/

3. Is a captive a good strategy for
me?
 As a first step, it’s a good idea to answer the
following questions:
 Do we have clearly articulated objectives (this includes
a prima facie business case)
 Is there leadership commitment from the top to make
this happen?
 Is the organization committed to charging a top level
executive to drive the strategy
 Does the company have mature global engagement
practices?

4. Clear articulation of objectives
 So does talking about cost-savings make sense?
 Of course. This is one of the core foundations of the model
 What are other business objectives that make sense
 Just cost-savings is not good enough. There needs to be a solid business
case that could be derived from:
 The need to keep strategic/IP related work inhouse
 To drive better productivity and responsiveness from vendors, from an “on-
the-ground” strategy….to transition them to being partners in the true sense
 To gain access to young talent
 To get access to talent with the latest skills
 To drive process improvement in the parent organization
 To ensure high speed 24*7 response to business needs, at lower costs
 To build specific competency centers at lower costs
 To build a global brand
 As a precursor to entering the Indian market
 etc

5. The cost angle
 Isn’t it cheaper to outsource to a vendor?
 Could be. But this isn’t about competing with a
vendor. It is about an overall strategy where the
vendor is a part of the eco system

6. Leadership commitment
 This needs to be from the very top. There can
be no compromises. Without this, this strategy
is a non-starter or will burn out
 This needs to be articulated at the Board level
too and must form part of the overall strategic
review of the organization

7. Commitment to having a top level
exec drive the strategy?
 This too is crucial. The person does not need to
be identified on day 1, but without this person
championing the offshore cause, the offshore
entity will flounder to gain traction and
commitment from the business leaders

8. Does the company have mature
global engagement practices?
 This may not be the case on day 1. There however needs
to be a commitment to rapidly transition to that point
 This is crucial when you consider the socio-cultural
impact that an offshoring strategy can cause
 Additionally the non-existence of this brings up potential
conflict where the company may have had past vendor
relationships that are “comfortable”
 Finally, global roles could be performed out of India
itself. Example: global customer support function

9. What does my going-in position
look like?
PLOT YOUR STATUS ON AN OFFSHORE CAPTIVE EVALUATION CHART. Example for
Company Z:
It is not
important to have
every objective This is non-
nailed down negotiable.
completely on Either it exists
day 1. But a or it doesn’t
broad business
case needs to be This too is non- A low level
articulated, and negotiable. If the simply means
additions can be commitment is changes need to
made as the unsure, don’t be made. But
offshore entity proceed this is crucial
matures and needs to be
considered

10. Shouldn’t attrition levels in India be
a criteria?
 A good people strategy sits at the heart of a
successful captive
 However attrition is not a criteria for taking a
decision to enter India (at least not today)
 There are several innovative and outstanding
HR practices in place that minimize attrition
and even use it as an opportunity to generate
fresh talent and thinking

11. Thank you