Adidas is establishing its first and only global capacity centre (GCC) in Asia outside China, specifically in Chennai, to concentrate on ‘key processes,’ as per sources familiar with the developments.
The decision by the prominent athletic footwear and apparel giant underscores the ongoing surge of multinational corporations investing significantly in India to establish their Global Capacity Centers (GCCs) and leverage the abundant software skills available in the country.
The German company, based in Herzogenaurach, Bavaria, will establish its Global Business Services (GBS) hub, with Akhil Kapoor at the helm of operations. According to Kapoor’s LinkedIn profile, he holds the position of Vice President – GBS Global Procurement and serves as the Head of GBS India, with Chennai listed as his location.
“Under his leadership, the hub will play a crucial role in key processes such as source-to-pay (S2P), financial planning & analysis (FP&A), invoice-to-cash (I2C), and record-to-report (R2R),” one source said on the condition of anonymity.
Adidas Anticipates Growth:
This person added that Adidas anticipates significant growth in its Chennai center and is planning to add ‘high-quality resources’ over the next three to five years.
“The Chennai hub has been designated as the Global Hub, seamlessly integrating with Adidas’ existing hubs in Porto (Portugal), Dalian (China), Bogota (Columbia), and North America to cater to the company’s global operations,” the person said.
As of the press time, queries directed to Adidas have gone unanswered.
Tamil Nadu Industries Minister TRB Rajaa said that Chennai is establishing itself as the ‘premier choice’ for Global Capacity Centers (GCCs) and research & development centers in India.
“We are leveraging our longstanding reputation as a knowledge hub and manufacturing powerhouse, as this foundation has been instrumental in showcasing our talent pool’s capabilities, earning the trust of existing and potential investors. This trend is particularly evident in the footwear sector, where our state already employs a significant number of women, and now, leading footwear brands are considering Chennai for their GCCs,” he said.
Adidas maintains a corporate office in Gurgaon, and the Chennai facility will be their first Global Capacity Centre (GCC) outside of China in Asia, as clarified by sources.
“Marquee brands in the sports brands space setting up GCCs is a significant development,” Lalit Ahuja, founder of ANSR said. “Brands like Nike and Lululemon which dabble in the same space already have their GCCs in India and typically, the size of such GCCs varies from employing 100 to 2000 people.”
The establishment of the Global Capacity Centre (GCC) by the world’s second-largest sporting goods manufacturer in Chennai is seen as a significant uplift for Tamil Nadu’s growing GCC ecosystem. This sports brand is now part of a group of global companies, including UPS, Hitachi Energy, ChampionX, JGC, Ashley, FleetCor, Sagent, and Udemy, which have recently chosen Tamil Nadu as the location for their first centers in India.
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Ramkumar Ramamoorthy, a partner with Catalincs, said, “GCCs are embracing Chennai for specialized skills at the intersection of technology and domain, and for growing at scale.”
“From what started as the hub for GCCs in the BFSI industry, Chennai today boasts of a diversified canvas across manufacturing, health sciences, telecommunications, logistics, energy and retail,” he added.
He mentioned that in logistics, four of the largest container shipping companies—MSC, Maersk, CMA-CGM, and Hapag Lloyd—and in retail, the largest brick-and-mortar and online giants, Walmart and Amazon, have their centers in Chennai.
“Just like in traditional IT services, where several majors have their largest global operations here, we are beginning to see GCCs scale their Chennai presence quite rapidly,” Ramamoorthy said.
According to a recent report by Colliers, Chennai witnessed a remarkable gross office absorption of 10.5 million square feet in CY23, reflecting a substantial 131% growth compared to CY22.
“When a company decides to set up a GCC, it is formalizing that whole construct and proceeding in a focused manner in terms of hiring resources that will work in the GCC to support the parent company from an IT, data and other functions perspective,” Ahuja of ANSR said.
He added that although a retail-focused Global Capacity Centre (GCC) might initially involve finance, procurement, and supply chain functions, it has the potential to progress up the value chain. This progression could include taking on tasks such as product development or the creation of e-commerce platforms, among other possibilities.
Adidas is currently engaged in active recruitment for these roles.
One such post around a month ago read, “We are building our innovation team at #AdidasGBSChennai. Join us and be part of #Adidas.”
This post was for positions such as Manager – Reporting and Performance Management, Senior Specialist – Data Engineer, Business Analyst – Continuous Improvement, and Senior Specialist – ServiceNow.
Kapoor also shared a hiring alert on LinkedIn nine months ago, indicating that the sports brand was seeking an individual to oversee their strategic supplier relationships.