Executive Summary: ISG Provider Lens™ Global Capability Center (GCC) Services - Global 2025

The individual quadrant reports are available at:

ISG Provider Lens™ Global Capability Center (GCC) Services - GCC Design and Setup - Global 2025

ISG Provider Lens™ Global Capability Center (GCC) Services - Optimization and Enhancement - Global 2025

GCCs are transforming from support centers to strategic hubs and driving innovation

The global capability center (GCC) market is undergoing a rapid transformation, evolving from traditional cost-saving hubs to strategic enablers of enterprisewide digitalization. Organizations are increasingly looking beyond labor arbitrage and are instead positioning their GCCs as CoEs that drive innovation, enhance CX and optimize business operations.

As enterprises seek increased operational resilience and digital agility, GCC providers are expanding their service portfolios beyond conventional outsourcing. Leading providers are integrating AI-driven automation, advanced analytics and industry-specific expertise to create end-to-end solutions that deliver long-term value. This strategic shift is redefining the GCC landscape, requiring providers to evolve from transactional engagements to becoming true business transformation partners. The demand for highly specialized digital capabilities within GCCs is increasing, with enterprises expecting providers to help build, scale, innovate and continuously optimize operations.

The evolution of GCCs from cost arbitrage to digital powerhouses

The role of GCCs has evolved significantly over the last decade. Initially established as a back-office initiative aimed at cost reduction, these centers have now transformed into digital nerve centers that support critical operations and drive competitive differentiation. Enterprises are no longer using GCCs solely for IT support and finance functions; they are increasingly leveraging these centers for AI-driven automation, real-time analytics and cybersecurity resilience.

The shift toward digital transformation has redefined enterprises’ perspective regarding their GCCs. The adoption of intelligent automation and AI-driven decision-making is allowing enterprises to enhance process efficiency and business outcomes. GCCs are increasingly being positioned as innovation hubs wherein enterprises can test and deploy new digital capabilities before scaling them across the organization. With an increased focus on business intelligence and predictive analytics, enterprises are leveraging their GCCs to generate real-time insights that improve risk management, compliance and operational efficiency.

Domain-specific capabilities are also becoming a major focus area for enterprises. Many are turning their GCCs into domain-focused CoEs, allowing them to develop expertise in key areas such as regulatory compliance, digital supply chains and CX management. In addition, enterprises are modifying their GCC strategies to ensure compliance with evolving global data privacy and AI governance regulations. The evolution of GCCs necessitates that providers deliver AI-driven solutions that enhance agility, cost efficiency and business resilience.

Strategic approach to GCC design and setup

As enterprises scale their GCC investments, they are leveraging flexible setup models that align with their digital transformation goals, risk management strategies and operational scalability needs. The Greenfield GCC model offers full ownership and control but requires significant investment. In contrast, the Build-Operate-Transfer (BOT) model allows enterprises to transition ownership after an initial operational period managed by an external provider. Joint ventures (JVs) enable collaboration with local entities to reduce risk and leverage market expertise. The assisted GCC model provides initial operational support  from providers while enterprises maintain long-term control. Many  enterprises are also adopting multilocation hybrid models, diversifying their GCC footprints across geographies to balance risk, compliance and access to specialized talent.

Beyond structural decisions, enterprises must also focus on digital and AI readiness, ensuring that modern GCCs are built with cloud-first, automation-driven architectures. Talent strategy is equally critical, as enterprises must develop AI, data analytics and cybersecurity capabilities to create future-ready GCCs. Providers play a key role in navigating these complexities, offering expertise in location strategy, digital infrastructure design and AI-first process  enablement. Enterprises are now looking for GCC providers that help with the setup process and take an active role in ensuring long-term scalability and digital innovation.

The race to capitalize on GCC growth

The rapid expansion of the GCC market has attracted a diverse range of providers. While traditional consulting firms have historically dominated the space, new entrants — including managed services and technology providers — are now aggressively competing for market share. The GCC market has become an area of focus for multiple service providers, including those that traditionally focused on IT and business process outsourcing but are now shifting toward strategic GCC advisory and operational support.

Leading IT services firms are investing in GCC setup and operations, despite the potential risk of cannibalizing their existing outsourcing businesses. Technology and operations providers, with deep expertise in AI, automation and  cloud-native solutions, are uniquely positioned to build digital-first GCCs, integrating AI-native operations from the beginning. Many providers are also forming alliances with hyperscalers, tech startups, real estate providers and consulting firms to deliver end-to-end GCC solutions. This competitive shift underscores the need for these providers
to effectively integrate technology, automation and strategic advisory to position themselves as key partners in the new era of GCC growth.

GCC optimization driving AI, hyperautomation and digital innovation

Once established, GCCs are focusing on optimization strategies that enhance operational efficiency and business impact. The shift toward self-learning, AI-powered operations is defining the next phase of GCC evolution, requiring organizations to implement AI-powered process automation to streamline workflows and reduce human intervention
in finance, procurement and HR operations. GCCs are also leveraging hyperautomation by integrating AI, RPA and ML to create selfoptimizing business processes.

A cloud-first approach is becoming a foundational principle for GCCs, enabling enhanced security, scalability and agility.

Workforce augmentation through AI is also gaining traction, allowing employees to focus on high-value, strategic tasks while AI-driven automation handles routine processes. Providers must align their solutions with AI-first, automation-driven and insight-led operating models, assuring real-time decision intelligence and effective enterprise integration. GCCs that successfully integrate AI and digital automation will be able to achieve long-term cost savings, improve business decision-making and enhance customer engagement.

Evolution of GCCs into AI-driven, autonomous and strategic business units

In this decade, GCCs will no longer function as transactional service hubs; they will operate as autonomous, AI-driven decision-making units that drive digital transformation at scale. Agentic AI will play a central role in enabling self-optimizing operations, where AI-powered decision models continuously analyze, refine and enhance GCC processes with minimal human intervention. Enterprises will also leverage generative AI (GenAI) for knowledge management, automating regulatory compliance, financial forecasting and strategic planning.

AI-driven digital twins will emerge as a powerful capability, allowing organizations to simulate real-time scenarios to optimize GCC performance, assess risks and improve business agility. This transition toward autonomous, AI-first GCCs presents an unprecedented opportunity for providers that invest in AI-native service delivery models and predictive automation. Organizations that adopt an AI-first GCC model will be strongly positioned to handle future market disruptions and drive enterprisewide digital transformation at an accelerated pace.

AI-driven GCCs shaping the future of global enterprises

The GCC market is at a critical juncture, with enterprises transitioning toward AI-driven, automation-first and insight-powered service models. The providers that will lead this transformation are those that can seamlessly integrate next-generation AI, predictive analytics and digital-first automation solutions. The GCC model is shifting from cost efficiency
to digital transformation leadership, making AI-first, automation-driven service delivery the new standard.

Providers must invest in hyperautomation, AI-driven knowledge platforms and real-time decision intelligence to  remain competitive. As GCCs continue to expand and evolve, leading the AI-native enterprise transformation will be key to global service delivery. The providers that embrace the AI-powered, insight-led approach will shape the  industry’s future and position themselves as the preferred partners for enterprise transformation. The success of GCCs will depend on their ability to create value through AI-powered operations, making providers that enable this transformation as long-term strategic partners for global enterprises.

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