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Global In-house Center (GIC) Landscape among UK Enterprises – Riding the Nearshoring Wave
26 Jun 2015
by
Sakshi Garg
Background and Context
The global sourcing market has grown steadily to reach US$150 billion in 2014. The contribution of GICs has grown to ~25% of the market, with the rest being contributed by service providers. While the United States is the leading parent geography for GIC model adoption, United Kingdom comes second at ~11% share in the overall GIC setups. Further, the share of UK-based enterprises is gradually increasing in the overall GIC market as more verticals are adopting the model for delivery of global services. Adoption of the GIC model by buyers in United Kingdom shows interesting variations in their shoring strategy.
While offshore1
locations continue to dominate the market landscape, recently there is an uptick in the nearshore2
activity, more so in certain specific verticals.
Scope
This research leverages Everest Group’s proprietary GIC database, the industry’s most comprehensive database on GICs. The analysis is based on 212 offshore and nearshore GICs of UK-based buyers providing delivery of global services and excludes onshore shared service centers :
- Data from the GIC database and Everest Group’s experience in the GIC segment has been supplemented by interactions with GICs on key themes of the study
- This report is relevant to a broad set of stakeholders – buyers / parent organizations, service providers, GIC organizations, and industry influencers (investors, industry bodies, etc.)
Contents
This report provides an in-depth analysis of the GIC model adoption among UK-based buyers in terms of growth, buyer portfolio, scale, functions supported, and key delivery locations.
The report also provides trends in the GIC landscape of UK-based buyers in the last 48 months (2011 to 2014). These have been compared with the cumulative GIC activity to bring forth the key areas of differences.
The report highlights key differences in market characteristics and delivery trends by offshore1 and nearshore2 geographies for the GICs of UK-based buyers.
It also provides a deep dive into the GIC model adoption trends across verticals and by analyzing the UK-based buyers’ GICs across prominent:
- Industry verticals (banking, financial services, and insurance; manufacturing, distribution, and retail; telecom; and professional & legal services) and
- Functions (business process – finance and accounting , human resource, supply chain, industry-specific, analytics, and customer care, information technology – application development & maintenance and infrastructure, and R&D / engineering)
The study concludes with an assessment of the impact of adoption of Service Delivery Automation (SDA) on GICs of UK-based firms.
1. [Refers to delivery of services from locations significantly far away from the source market and providing significant cost arbitrage. e.g., India, Philippines, Costa Rica, and Malaysia]↩
2. [Refers to delivery of services from locations in close proximity of the source market (United Kingdom) or close cultural affiliation (South Africa). For this report, nearshore UK locations comprise Scotland, Northern Ireland, Ireland, South Africa, and Central & Eastern Europe]↩
Page Count: 67
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