Australian firms shift core functions to offshore GCCs

Australian businesses are outsourcing more core functions to global capability centres, with the shift now extending beyond customer support and recruitment, according to TP in Australia.

The move is spreading into human resources, payroll, finance, workforce training and technology, said Richard Valente, Vice President of Customer Experience Strategy at TP in Australia. He said companies are entering a more advanced stage of outsourcing as they respond to skills shortages, rising operating costs and pressure to digitise.

Global capability centres, often referred to as GCCs, have typically served as offshore support hubs. Businesses have long used external providers for customer service and recruitment, but the model is now expanding into functions that were once more likely to stay in-house.

Valente said the shift reflects a broader rethink of how companies use offshore teams. Rather than treating them as low-cost service providers, organisations are increasingly positioning them as integrated partners with responsibility across a wider share of the business.

"Australian businesses have been comfortable outsourcing recruitment and customer service for years, but what we're seeing now is the next evolution - the offshoring of core business functions like HR, payroll, finance, workforce training, and technology," said Richard Valente, Vice President of Customer Experience Strategy at TP in Australia.

He said the trend is no longer driven only by cost cutting.

"This isn't about simple cost-cutting anymore. It's about scaling specialized capability," Valente said.

Broader role

Global business services and GCC models are also being used to access specialised talent in areas such as data, artificial intelligence, finance and human resources, according to TP. For employers struggling to hire and retain workers locally, that offers another way to build teams without relying solely on domestic recruitment.

The shift is also visible in the authority given to these offshore operations. TP cited a recent study showing that nearly 20% of global capability centres now hold significant strategic authority, up from 5% a decade ago. The figure suggests some centres are no longer limited to execution and administration, but are taking on roles tied to broader business transformation.

Valente said the model is gaining traction in Australia as companies try to stay competitive in a more digital economy. He said offshore teams are moving closer to both customers and internal decision-making.

"It's a smarter, more agile way to access specialised skills - particularly in areas like data, AI, finance and HR," Valente said.

"We're seeing traditionally outside teams move closer to the customer and the business," he said.

"They are now working more directly with stakeholders, solving complex problems, and contributing to enterprise strategy rather than just executing tasks," Valente said.

AI influence

Artificial intelligence is also shaping how these teams are used. TP said offshore operations are not only supporting AI projects, but are increasingly involved in building and running systems used in customer service, internal workflows and enterprise software.

That marks a notable departure from earlier outsourcing models, where external teams often focused on repetitive or tightly defined work. In the newer model described by TP, global teams are tied more directly to operational change and technology deployment across the organisation.

"Global teams are no longer just supporting AI initiatives by embedding AI into customer service, internal workflows and enterprise platforms. They are building and running them, fundamentally changing their role within the organisation. This human-plus-AI approach ensures that while technology drives efficiency, human empathy remains central to delivering results that are simpler, faster, and safer. AI is a major catalyst here," Valente said.

Mindset shift

Valente said companies will need to rethink outsourcing if they want these arrangements to work. He said businesses should stop treating offshore work as a transactional transfer of tasks and instead focus on building global capacity embedded in the organisation.

The comments point to a broader challenge for Australian employers as labour shortages persist in parts of the economy and digital transformation becomes more urgent. For companies under pressure to modernise systems while managing costs, the appeal of accessing skills offshore is likely to remain strong.

TP, part of the wider Teleperformance group, provides customer care, back-office support, consulting and digital transformation services across multiple markets. The company said the evolution of GCCs and related service models is changing the role these operations play inside large organisations.

"The companies that will succeed are those that stop thinking about 'sending work offshore' and instead focus on 'building global capacity' by embedding these teams into the DNA of the organisation," Valente said.