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00:00:03 DEBJANI GHOSH: Such a pleasure to have this conversation with them because these are two leaders who have seen, experienced, made that change happen. You guys have been involved in this journey from the very start. It used to be called something else, global captives, if I'm not wrong, right at that point in time. So you have been involved right from the start. So Gunjan, let me start with you. You know, what was that strategic inflection point where you felt that this can be a completely different story?
00:00:40 GUNJAN SAMTANI: Very, very warm hello to all of you and thank you for hosting us, Debjani and the, the team from, from Nasscom. Just to step back for, for, for a minute and, and, and, and, and share some bit. When I was interviewing at Goldman Sachs and looking to return back to India, actually held back for many weeks because I wanted to be an individual contributor. And, and little did I know that, you know, 13 years into it, the roles will evolve so much. But there is an aspect about what I want to highlight there, which is the mindset has never been about the size of the organization or the number of people that we have. Yes, of course, it is about the execution capabilities that we provide from our offices to the firm. But it is so much about the individual capabilities that individual USB that we each carry that we each bring in transforming our businesses front to back. And the pivotal points that you mentioned Debjani, as I relocated in US thinking about building strats or Quans or people who apply mathematics and statistics to finance. At that time it felt business as usual, like it didn't feel like its an inflection point only. Only now when you look back in, in perspective in in hindsight that feels like it was a deep inflection point for us. The second inflection point that I feel came to perhaps many of us was the continuity of the businesses that we were able to support and prosecute in the middle of COVID. And it was an inflection point not just for individual companies, but it was an inflection point for this story of GCCs. I have seen the the discussions in the boardrooms and, and a range of these conversations with the with the board members, with the CEOs of different clients of the firm, including our own evolve on the back of what our country was able to pull out in the middle of COVID. And so to all of us, it was an incredible story of resilience of our people and a determined, determined support from the policy makers, the industry bodies, and a tremendous validation of the infrastructure of our country that stood the test of times across cities and villages. Ban India. And so with all that behind us, you know, we will get perhaps deeper into this conversation now that we have arrived here. Where do we go from here? And so I'm looking forward to that, that part of the conversation as we move along. We.
00:03:23 DEBJANI GHOSH: Will come to that. Sunil, your perspective, anything you want to add to what Gunjan said and and you know, I talked about can we aspire to be the nerve centres? What do you have achieved? When I look at your story, I think you've got very close to that, so maybe you want to share a little bit about that journey and what were some of those key moments or decisions that you took which changed the game for you?
00:03:51 SUNIL GOPINATH: Yeah. Thank you Debjani for this and very nice to be here with this audience and its great to see a GCC focused conference which sort of elevates the importance and the impact the GCS have been, you know doing in India for the last couple of decades. I think I'll just probably give one or two quick examples of pivot points. You know when I joined my current company Rakuten about eight years ago, it's a Japanese conglomerate, one of the largest tech companies, tech based digital businesses in Japan and global. We were about 50 people eight years ago. Right now we are 4/4 to 5000 employees. I think there were several sort of forces that drove scale for us. One was technology driven transformation, right? You know, as a company with very diverse businesses from commerce to fintech and banking and so on, it became very clear to us that deep tech data, data sciences, customer analytics, information sizes, AI sort of will drive the business for us, right? So they're not just an enabler but of business, but technology is the business like cross sales forecasting, revenue forecasting, risk solving for fraud, anything and everything had to do with that. And I think India, you know, in the last six or seven years with the not only understanding of our business context, global business context, right. You know, we've got employees who worked in e-commerce company globally, we've got employees who worked in e-commerce in India, in Flipkart and Amazon and so on. So because of the deep understanding of the business context and a natural gravitation and skill sets in data sciences and analytics that goes all the way back to the history of India in math. I think there was a natural fit for us in sort of pivoting to a point where you know we hired about 2000 data scientists and engineers. So there was one pivot also second pivot and particularly because we are not necessarily a American company, but a Japanese companies that the cultural melting of the minds and hearts, you know is a process, right. I mean because there are natural strengths that we as Indians have. There are natural strengths that Japanese have from their long and rich history and sort of getting them to a complementary stage where sort of its additive or a creative in value also played a big part in, you know, an exponential growth.
00:06:25 DEBJANI GHOSH: You need to take a master class on how you were able to do that. I think that's one of the biggest challenges, especially with Japanese and also, you know, a few other companies that we see.
00:06:37 SUNIL GOPINATH: Yeah, yeah. I mean, I'd be happy to share more in the next session, so.
00:06:43 DEBJANI GHOSH: You know, I talked about, I asked the question, is this it? Have we really achieved the pinnacle of success? Because everyone's talking about that and everyone saying how great the India GCC story is. So how do you guys see it if let's forget 2047, but even if you look at the next 10 years, right, is this it or is it going to be incremental growth of what we have already achieved or is there some radical opportunity out there that can bring in the next big disruption?
00:07:18 GUNJAN SAMTANI: I think I'll, I'll give that answer in the context of at least our industry and our firm. It's a, it's a, it's a financial institution that I work for. And my view is it took us some time to build the business context. It took us some time to build the deep connect into each of the businesses, into each of the functions across all the entities of the firm around the world. It took us some time to bring the culture of the firm, a 154 year old company into India and to and to harmonize, harmonize in a way that our offices are any other offices of the firm. It just they just so happened to be in India. And now that we have come here, to me it is it is both an opportunity to dramatically scale out with the macro of the environment of Gen. AI and everything else that is going around there, but also to capitalize on an organic leadership that has been built ground up in allowing for lifting the lid on what our officers can continue to contribute deeply into, into a global financial services organization. I will acknowledge, you know, for a long period of time, I have never allowed anyone in our offices to call us as GCCs. We don't use that terminology. In fact, in hosting many board members of different clients and different C level executives actually stop them many times. If they ever refer to our offices or offices like what we have built in India or what their companies have built here as captive sites, what do?
00:09:13 DEBJANI GHOSH: You call them.
00:09:14 GUNJAN SAMTANI: And never allow them to be used as captive sites. It's such a such a colonial term to to talk about a wrapper of the ambition of thousands of people or millions of people who work in this, in this, in this industry. And so we are front to back businesses of Goldman Sachs with deep engineering capabilities. That's who we are. We have roles in sales and trading, in portfolio management, in wealth management, in research and banking, in financing with deep engagement of strats, corns and and engineers into each of our businesses. That's who we are. And I'll talk about Jani as, as as we move along in the potential of the transformation at a nonlinear scale from here on. But I'm very keen to hear what what you what your identity is. Sunil, when I say yours, I'm talking about Rakuten.
00:10:11 SUNIL GOPINATH: Thank you, Gunjan. I think to start with Debjani's question about have we reached the pinnacle or you know, reach the peak of the evolution in GCS? I would, my broad answer is, I mean, we are just in the beginning stages, right? And the reason is we and I personally have had an exploratory mount mindset or a day one mindset even today, right? Even though I've been there for 8 plus years and we have constantly pushed the boundaries of who we are and what value we bring to the table, right? In other words, that the definition itself has morphed in the last eight years. I'll give you 2 specific examples. The first way we stretched the contours of what a GCC means. Of course, we started off as a technology center, right? You know, we've got great talent, very tech savvy engineers, you know, building for the global businesses. We reached a point in one of our businesses, and this is a specific example. So there's a business we have called Rakuten Payments, which is like the phone pay Oregon, Google Pay of Japan, right? We are the number one payments company amongst our 70 businesses now just based on the take transformations that needed to be done. You know it was an in house solution. We had to just scale up for massive scale. You know we had about one or 2 million users initially. Now its like you know 203040 million users, huge traffic. So by just the gravitational force of the India team building for that scale, resilience, availability and so on, over time, the entire product business team strategy, engineering, everything moved to India unknowing not necessarily having planned for it. And then I was having a discussion with our board and I and, and one year later, I said, do you not realize that the number one and the number two payment companies in Japan, which is about 85% of market share, the entire team operates from India, only the business happens to be in Japan. And he's like, OK, I know number one, it's us, your team is there, which is number #2 they were thinking was a Japanese company called Pay Pay, which is actually Paytm sitting in Delhi, right? And they were really shocked. Clearly they didn't. This characterization that it just became a market for two products that were completely run from outside of Japan was a transformational mindset shift in the first place. So that was one pivot, You know where I feel that to your point, we've got to continuously try different things and then expand the contours. The second example I can give is see, we went through a personal journey or reflection on, we have built all these amazing technology from our Bangalore office for global businesses, right? Everything from security to, you know, AI to cloud products, you know, deep data sciences, system architecture for scale, cloud transformation, so on and so forth. And we said, look, there are companies that have gone journey of externalizing their technology because if it's good enough for as large a company as, you know, Rakuten, it's good enough to be taken to the market. So we actually went to the board of Rakuten Inc and said, hey, you know here is we just took about two or three of our product portfolios. One of them is in the observability space, right? You know, AI enabled observability and we said this is adopted in two dozen companies within Rakut and we would like to take this external, we'll try it in the India market, make a business for it and then take it global. It was a very hard sort of back and forth because they were not necessarily used to transforming. It's AB2C company. How do you transform this to AB2B company? But anyway, we won the argument that day and then we incubated this, created a business. And I'm happy to say that, you know, it's a multimillion dollar business running from our Bangalore center now where Rakut and 6th Sense, which is the product that we built, is not only adopted by about, you know, three dozen companies in India in airlines and, you know, government and defense and so on and so forth, but we also sold it to North America and Chile and so on and so forth.
00:14:27 DEBJANI GHOSH: And this was designed, conceptualized design pitched by you to the company. Absolutely. This was not the company asking you to do something.
00:14:35 SUNIL GOPINATH: Absolutely, absolutely. And that again comes from this. It depends on the culture, right? If you're passionate about continuous value addition, continuous growth, continuous transformation systemically, then you're not going to stop at what you did last year.
00:14:52 DEBJANI GHOSH: Absolutely. And that that's where I want to go to, right? I talked about the three things and if you all have another one to add to, but talent, technology and leadership and how all three have to come together to shape the, the road map, the road ahead, right? I'll leave talent aside because a lot will be said on talent over the next two days and we have limited time. But I do want to touch on technology and leadership. I'll start with tech first. The disruption that AI is bringing on us, the real disruption sector by sector, the potential to get disrupted. What is the opportunity for GCC's that you see and how can we differentiate like, you know, how does GCC's make or leverage AI as a competitive advantage? What do we do? So, thoughts on that either of you? Whoever wants to start?
00:15:47 GUNJAN SAMTANI: Look, firstly it's it's still evolving and it's revolving at a significantly non linear curve from from enterprise perspective in GCCs, I think the the focus is should not be more on the foundational models. You should just expect that the foundational models are those of, of really big players of, of sizable capabilities that, that have, that have access to hundreds of thousands of, of GP US and perhaps India as a country as we were talking about it, Devyani should be, should be investing in, in the foundational model. From AGCC perspective, it's about taking the foundational models and and and then thinking about what are the, the domain specific, domain specific products, domain specific transformations that can be enabled on top of our, our businesses. At, at our firm, we are thinking about a significant elevation of Gen. AI across each of our businesses. A lot of it will be delivered from our our engineers, but also non engineers who are seated in each of our front to back teams here, which means there is a significant element of organizational change management that we have to go through. Organization change management also means what is the leg of the thinking that the leaders are going through in framing what is a Gen. AI enabled simulation of their respective businesses is and and in there the partnership with the with the ecosystem is critical. The ecosystem is we typically operate GCC serving the the different entities of the firm for sure. But there is an aspect of working and partnering among different companies within the GCC ecosystem that is critical, including with the hyper scalers, including with the Tetris companies, including with with a range of local domestic companies that has to come to bear to help in transforming that that that that set of businesses that that each of our companies represent. And I'll just close by saying that each industries imperative is different. Ours is a heavily regulated, heavily, heavily, you know, you know, governed industry with different regulations in different jurisdictions that we operate in. And yet the ability for the GCCS in the banking industry or regulated industries to have a bird's eye view on what are the regulations that are applicable to each geography is unique, is absolutely unique because our partners in US are thinking about what is happening in US. Our partners in in Europe are thinking what is happening in Europe. Here we have an eye view of what is happening in the world and being able to design solutions that are applicable to each of those geographies, but harmonize around what are the the common denominators or what is acceptable in the world. And so, so its a generational opportunity right in front of us. Sunil.
00:19:00 DEBJANI GHOSH: You, you have, I mean, I'm, I'm aware of the work that Sunil does and I think you guys are already at the cutting edge of AI in terms of a lot of the work that you're doing, right? What's the next big thing that excites you?
00:19:17 SUNIL GOPINATH: In general, in AI or in the context of India. And see, I think that while a lot of the focus is on sort of the general purpose LLMs and foundational models that are being launched in the world, just because of how frequently they're launching and the buzz around it, you know, and all the cool stuff, which is all worth it by the way, right? You know, open AI and Meta and all of them. I, what I'm excited about is 2 things. One is that the potential that these models will unlock. I mean, this is to me the equivalent of the Internet being invented, right? And thanks to the founders of the Internet, they made it free for the rest of the imagine if somebody charged for the Internet to be used, right? TCPIP stack, 20 seconds per API, I mean $0.20 per API call. I mean, there's no way we would have all reached this point. So I see AI being becoming pretty much the same, right? At some point in the future already. GPT 4-O is half the cost of GPT 4 right? So this sort of 10X growth in capabilities is always going to be attached to a 10X reduction in cost and it's going to reach a point of marginal cost or pretty much free, right? It's just data in, data out. So that's going to just absolutely be a game changer for me, right? I mean, you see what is happening and I'll tell you it is so transformational, particularly the things that I'm seeing in education sector, right? Somebody, actually a student, an avatar is teaching a student an avatar of a teacher. The student writes the Einsteins formula, shows it to the camera and the camera says, oops, that's wrong. You have written E=MC3, right? Are you sure it's right? I mean, just complete. Imagine a student in a Tier 2 or a tier 3 city somewhere in India or you know, Vietnam or wherever it is being taught by a Nobel laureate like Milton Friedman in his avatar teaching economics to them, right? Imagine the potential of what it can unlock. Extremely excited. Second, I feel LLMS are one slice. One of the things that we are ourselves grappling with or resolving for is while the capability of an LLM is important natural language processing to us, it's going to become as fundamental as it's another human computer interaction, right? Conversational AI is the new keyboard of this century, which means it's it's no longer a fancy UX, but almost anybody, any application that's going to be launched, any business is going to get, you know, a conversational UI plugged in by default, right? Which can summarize things, which can act like a human, which can brings the human touch. Now the question becomes, is an LLM really needed right. If I'm an e-commerce business, if I'm healthcare, if I'm doing IT OPS, I think the possibility for LLMS, and this has implications for India as well, where I don't need a 10,000 GPU farm where I have to spend $500 million these days. People have already built LLMS that can run on CPUs. Yeah, you can train it, you know, on a GPU, but on a day-to-day basis, the CPU is good enough. Because I'm not going to ask a healthcare application what is happening between Israel and Palestine, right? That information is not needed at all. So I think SLMS, context specific LLMS, embedded AI in in your refrigerator, right? There's going to be Gen. AI. It just needs to know things about the food and the temperature and that's going to be a few kilobytes of code. So I'm really, really excited about what's embedded AI going to do and things of that nature.
00:23:02 DEBJANI GHOSH: You know, right now one of the biggest questions I get, especially when I talk to governments outside India is where is the ROI, right? We are investing so much now. If you look at just US and some of the big tech companies, rough number, the estimates are anything between 70 to 85 billion that has been invested just last year right in, in primarily in compute. But building these models, the question is, where is the investment? I mean, where is the ROI? What are those big use cases that you can solve to get the returns? And you'll have to pretty much hit a 200 billion revenue to to even get the returns, right. And I think that's, in my opinion, that's where the opportunity is. You need someone to make AI real. You need someone to solve those problems where you start getting the returns. And I think that's a huge because GCCs cut across sectors. If GCCs can become that engine of innovation, that can start making AI real sector by sector and driving the actual disruption. We talk about disruption, but driving the actual disruption across sectors. A lot of it will be workflow automation. That's where the money is, right? I think that's a huge opportunity again for for GCCs leadership May.
00:24:32 GUNJAN SAMTANI: I just may I just add and if it's OK, I'm just going to go broader than GCCs in the context of this, this specific pointer. Goldman published one of the most groundbreaking research on the potential of Gen. AI in terms of personal productivity and employee productivity over a tenure of 10 plus years. How when, when there is mass adoption of of Gen. AI and the mark that we are carrying is that it can add up to 10 to 15% to the world GDP. India alone can be a beneficiary of 1.2 to $1.5 trillion in incremental GDP enabled by Jen AI. And on an individual basis, like in the context of an employee role, the the view is that it can be 1.3 percentage point annualised for a decade at the point that Jen AI technologies become mainstream. The world has not seen this kind of unlock in personal productivity since the personal computers came in 1990s and since 1990's. The the, the view about the, the, the marginal growth in productivity is just a very small fraction of the numbers that I just mentioned. So it, it is, it is, it is huge. And if I may just mention one more point, which is for the GCC. So I'm bringing it back to GCCs for years, for years since this type of talent hubs have evolved in the companies to come in locations in India, there is this aspect of institutional knowledge that we have felt a barrier against institutional knowledge. Ability to go and discover what was the context in which that document, that business decision, that code was written. How dramatically empowering it is at an individual level not to feel the barrier of that what that institutional knowledge is because it is so much discoverable in the context of what your learning ability is. And being able to get the full understanding of those aspects of the businesses, those documents, those artefacts, wherever they are, in whichever language it is written in your vernacular.
00:26:55 DEBJANI GHOSH: Yeah, two more questions that I have in mind and I'm going to request you all for short answers because we are running out of time, so treated as rapid fire. But let's talk leadership a bit, right? Because what got us still here is again not going to get us to the next pinnacle or next peak. If leadership has to change to drive this transformation that we think we should, we should be going after the next few years. What are the three most important leadership capabilities that you think is needed to for the road ahead? I'll start with you, Sonal.
00:27:34 SUNIL GOPINATH: Can I take a more sort of wider expansive view or?
00:27:37 DEBJANI GHOSH: As long as you can cover it in like 30 seconds.
00:27:42 SUNIL GOPINATH: I think it's more ok if I can summarize it. It's be be in control of your destiny, right? Whether it's in the GCC context, having a very end to end view of what's going on in the business, what's going on in the company, what's going on in the technology, having a perspective of that, being able to connect the dots will help build a very sustainable, long term, very, very meaningful, impactful organization. And I mean, the same thing for the whole AI conversation we were having, right? I mean, you look at what's going on right now, NVIDIA, Qualcomm, Intel in the US manufacturing in of all the AI chips happening in Taiwan, India, China, all in world, India has no option but to be end to end vertically integrated, right? The chips is where everything is. I mean, software part is much easier to build the open AI stack, blah, blah, blah, applications, all of that. So being in control of your destiny, end to end is the primal sort of force that needs to be, you know, taken hold off, whether it's inside an organization or as a country level. That would be my perspective.
You know, I'll say be commercial in whatever fractal of the role that that that one carries. Have the connect, connect in the organization, in the industry, in the academia so that the so that the continuous context is, is is the responsibility of the leader. And then last but not the least, be a cultural carrier of the organization that you are in. The integration of these three, practiced on a continuous basis, is what typically lifts the lid for the entirety of the unit or for the teams of other organizations that you are managing.
00:29:31 DEBJANI GHOSH: You know, I would. First of all, thank you, both of you. This has been an excellent conversation. I hope you agree. I would just end by saying I think I really believe that you have to reimagine your role in the organization, the GCC leadership teams. It is not just about leading the GCC. You are, you know, ensuring your GCC is successful. I think it is about thinking bigger in terms of your overall business and your overall business success and how do you drive that. It's, it's, I think you all have worked so hard to come to where you are and it's fantastic to see what you have shaped this, this sector into this this segment into. But it but miles to go before we sleep, tremendous opportunities ahead and would love to see where we are in the next 10 years. I think not just for global business success, but I also believe you will be absolutely crucial for India's success, for India's ability to truly transform into Vixit Bharat, the GCCs and the role you play is going to be absolutely crucial. So with that, thank you. So.
00:30:47 GUNJAN SAMTANI: May I just say, Debjani, thank you for what you do. I actually talk about Nasscom and your role in in how the government has become so much friendlier in the context of what is required to drive innovation. Is more need, Does more need to be done? Of course. But when you have practitioners in the roles that you are in and with the boys that you carry, it makes a big difference. I'll mention you started, you gave your talk that there there was this article on Satya Nadella. Would the next Satya Nadella be based in India like the lifting of the lid would be? Would the next Microsoft be in India? And and that's what we should be thinking.
00:31:31 DEBJANI GHOSH: Thank you. Thank you very much for that.
