Global Competency Centers and AI Drive the Future of Outsourcing: Avasant’s Kevin Parikh Predicts Industry Transformation

The rise of global competency centers (GCCs)—dynamic hubs of specialized talent, innovation, and expertise—will shape the future of outsourcing, Kevin Parikh, Chairman and CEO of Avasant, projected during a compelling keynote at OWS25 in Chicago.

“We must embrace AI solutions, autonomous technologies, and the rise of global competency centers,” he said. “GCCs will drive the industry forward, redefining how organizations operate on a global scale.”

Rapid advancements in AI and fully autonomous technologies are powering the next wave of industry evolution, sharing these statistics to illustrate the growth:

• By 2030, data centers dedicated to AI are expected to grow by 165 percent, illustrating the acceleration of technological infrastructure.
• AI-driven digital service contracts have surged by 90 percent, signaling robust market adoption.

A Legacy of Adaptation

A member of the IAOP Leadership Hall of Fame, Parikh’s visionary insights opened the summit, setting the tone for a gathering focused on emerging technologies. He traced the industry’s evolution since the early 1990s—from government-driven initiatives during the Clinton era to navigating crises like the dot-com bust and the 2008 financial meltdown.

Today, rising wages and productivity boosts from technological innovation are diminishing the effectiveness of cost-cutting strategies rooted solely in offshoring. Instead, companies are pivoting toward AI-enabled services that enhance efficiency, foster innovation, and unlock new value streams.

Redefining Outsourcing

Parikh emphasized that the traditional outsourcing model, centered on labor cost arbitrage, reached an inflection point in 2014. He elaborated that each wave of innovation triggers labor disruptions but also paves the way for new roles and capabilities, transforming how organizations approach sourcing and talent.

“In the story of the outsourcing industry, outsourcing has been the emblem of a boundless world, and now it's being redefined,” he said.

Enter Fully Autonomous Systems

The new era is characterized by autonomous technologies—systems capable of operating with minimal human input. Parikh highlighted their role in powering smarter supply chains, virtual GCCs, and multi-country service models that operate seamlessly across borders.

“Most outsourcing is going to happen in automated lights-out facilities,” he said.

Organizations are transforming their sourcing strategies by creating globally dispersed Centers of Excellence—virtual hubs staffed with experts, scientists, and AI-driven systems. These GCCs facilitate faster, more resilient, and innovative operations that go beyond traditional offshoring models. Located across the US, India, the Philippines, Mexico, and other regions, these centers are reshaping the future of global talent and operational agility.

Navigating Geopolitical and Economic Currents

This technological upheaval coincides with geopolitical tensions and shifting economic realities.

Parikh challenged the notion that tariffs alone drive inflation, describing the global economy as governed by “economic gravity,” where goods naturally gravitate toward equilibrium prices despite sanctions or tariffs.

He cited examples such as discounted Russian oil sold to India and redistributed to countries like Germany, which maintained price stability despite sanctions. This interconnectedness underscores the need for smarter, more adaptable sourcing strategies that consider trade agreements, geopolitical risks, and economic realities, not just labor costs.

“Our sourcing strategies of today must go beyond labor,” he said. “We know that we must consider tariff exposure, trade agreements, and geopolitical risks. We are and must become smarter. We cannot move forward with the same outsourcing strategies of the past.”

Preparing for the Future

While technological advancements are reshaping roles across industries, Parikh noted that approximately 80 percent of organizations are shifting outsourcing efforts toward specialized human talent, such as medical professionals, legal experts, and licensed engineers, whose roles require judgment, certification, and human oversight.

“These roles are less susceptible to automation,” he said, “because human expertise remains vital. Accountants signing tax returns, lawyers filing pleadings, doctors signing prescriptions—these will continue to rely on human involvement.”

Nonetheless, roles lacking specialization face higher risks of automation and displacement.

Parikh concluded with a call to action: “The future of outsourcing is bright, but only for those willing to adapt. By harnessing AI, autonomous systems, and reimagining global talent strategies, we can navigate this new landscape and unlock unprecedented value.