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October 2013
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All the information contained in this report is obtained through proprietary technology aggregation algorithms, human experts, network of domain experts, discussions with industry leaders, public and confidential information sources believed to be reliable. Talent Neuron makes no representations or warranties regarding the errors, omissions or completeness of any information contained herein and shall have no liability for the same. The report is provided solely for informational and marketing purposes and opinions must not be construed as advice, recommendations or endorsements. The reader of the report is advised to conduct an independent evaluation and form conclusions with respect to the information provided.
F&A Landscape & F&A Globalization (Available in Full Report) HR Globalization and Sales Operation (Available in Full Report)
Procurement (Available in Full Report) Business Function Talent Pool Split (Available in Full Report) Case Examples (Available in Full Report) Key Challenges (Available in Full Report)
Overview Cost savings along with enhancing process efficiency are two main factors due to which companies globalize their Shared Services
Insights
Sources: Talent Neuron Quarterly Events & Talent Neuron Surveys 2012 & 2013
Talent Neuron
Overview Companies have been increasingly off shoring/outsourcing their support functions
Globalization Maturity of various functions
HIGH
F&A IT* R&D* Customer Support Human Resources Today companies have matured globalizing their R&D and IT activities
Globalization Rate
LOW
Laggards
Process such as lead identification, requirement analysis and delivery management are expected to be increasingly globalized
Mature
Talent Neuron
Overview Countries across APAC, EMEA and LA are preferred locations with their unique advantages and disadvantages
Ireland
Eastern Europe China
Costa Rica
Sri Lanka
Brazil
Argentina
South Africa
Australia
Current hot Global locations Potential alternatives
Key Cities - Metro Manila - Bangalore - Chennai - Gurgaon - Hyderabad - Cebu City - Mumbai - Kuala Lumpur - Selangor - Dalian - Chengdu - Guangzhou - Johannesburg - Krakow - Colombo - Shanghai - Beijing - Glasgow - Wuxi - So Paulo - San Jos
Talent Neuron 6
Overview India, Philippines and China lead the pack of countries that are suitable for globalizing Shared Services
Cost Attractiveness Vs Globalization Suitability
HIGH
Canada
India
Globalization Suitability
China
Philippines
MEDIUM
Ireland
Australia Spain
Singapore
Poland
Chile
Brazil Turkey Ukraine Argentina
Costa Rica
Cost Attractiveness
Note: Recent dollar appreciation has enabled India and Philippines to increase the cost arbitrage
Talent Neuron
Captive Trends In the recent past, India has garnered a lions share in terms of number of Global In-house Center setups with diverse set of models
Captive centers (GICs) per geographic region
# of Centers
146 100 90 80 70 60 80 52 52 50 40 30 20 5 India China
11
10 0 2
22 10 6 6
28
29
Talent Neuron
Key Challenges Attrition and lack of experienced talent with domain knowledge are key challenges companies are facing in the global centers/operations
Attrition in most companies has ranged between 8%-22% in the last 3 years Increased competition for talent from service providers and lower compensation levels are key reasons
Attrition
Lack of domain expertise and proper understanding of regulatory, quality and security compliance processes
Process Adherence
Organizations are not able to determine the right training (process training, spoken/written language training and cultural sensitization training) programs for their staff
Key Challenges
Lack of career progression, low compensation and minimal customer interface lead to low morale amongst shared services employees Employees are not culturally well aligned to the parent organization
Language Expertise
Hiring talent for translation-related jobs is difficult ,and this in turn hinders the process efficiency Scaling language experts to the required level normally takes time and this impacts the quality of work.
Since the industry is yet to attain maturity, companies find it difficult to hire professionals with about 8-10 years experience
Source: Interviews with key industry stakeholders at leadership levels, Talent Neuron
Talent Neuron
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