Global Capability Centers (GCCs) are often presented as a way to regain control over offshore delivery. But I have a question for executives considering that move: if outsourcing failed, why should owning the delivery center automatically produce better outcomes?
Across more than 25 years leading global IT service delivery, I have seen extraordinary commitment and technical capability in offshore teams. The challenge was not the employees. It was frequently the way they were managed.
Some leaders kept a hierarchical distance, focused on operational metrics and treated their teams as resources to control rather than people to engage, enable and empower. The result was a workforce with talent and passion, but limited opportunity to contribute fully.
Changing the ownership model does not automatically change the leadership model.
When I visited our teams in India, I didn't arrive to inspect a dashboard and leave. I spent time with employees, listened to them, built relationships and worked alongside them. Employee satisfaction, customer satisfaction, productivity and quality often improved while I was there.
Then I would leave. The local management team would return to its familiar routines, and those improvements would erode.
One employee said something I have never forgotten: “The managers were so happy you left because now they had their kingdoms back.”
That comment captured the problem better than any operational report. Leadership was being exercised as positional authority, not as responsibility for creating the conditions in which employees could succeed.
I have also seen a Canadian financial institution move work back from an unsatisfactory offshore outsourcing arrangement. Under a different management structure, performance improved. That experience reinforced my view that the leadership system matters as much as the location or ownership of the work.
You can move the work. You can hire the talent. But you still have to build the leadership capability.
None of this means GCCs are a bad strategy. They can strengthen institutional knowledge, accountability and strategic alignment. Nor is hierarchical management unique to any one country. The risk is assuming that a new legal entity, new branding and a new organization chart will somehow transform established management behaviors.
Before investing in a GCC, I would want to know: How will you select and develop first-line managers? How will employees be heard? How will leaders be held accountable for engagement, enablement and empowerment—not just service levels and cost? And how will improvements survive after the executive visitors go home?
If you cannot answer those questions, you may be changing the delivery model without addressing the reason delivery disappointed you in the first place.
