The proposed HIRE Act has sparked dramatic headlines. Some are quick to predict the death of Global Business Services (GBS). My take: No, GBS will not die at the HIRE altar. Deborah Kops, Executive Advisor to Everest Group and Principal at Sourcing Change, in a recent thoughtful piece, “The HIRE Act: When Washington Comes for GBS,” frames this as a wake-up call. She also emphasizes that GBS must own the narrative.
At Everest Group Engage – Dallas 2025, this was the front and center in executive discussions. Leaders agreed: reshoring millions of jobs is neither feasible nor desirable. The answer lies in action, not an alarm. While a lot of the legislature is based on Ifs and Buts, I felt motivated to share my thoughts, given the anxiety this topic is causing in the current political landscape. But instead of writing an obituary, I want to ask a different question: how can GBS leaders prepare to turn this crisis into an opportunity?
It is worth noting that the current wave is not limited to the HIRE Act alone. Parallel proposals like the Keep Call Centers in America Act introduce disclosure mandates, penalties, and even “naming and shaming” lists. Even if the actual passage is uncertain, the visibility is high, which means boards and CEOs will ask hard questions. This is as much a reputational and governance challenge as it is a cost one.
Here’s how…
Seven moves GBS leaders must make:
Accelerate AI and automation:
This is no longer about pilots. AI is already here, and automation has gained momentum in the last couple of years – the challenge is speed and scale. A 20–30% productivity gain through intelligent automation, generative and other forms of AI, and redesigned processes can blunt the effect of a 25% tariff. Every CEO and GBS leader should be asking: where can we accelerate now?
Double down on offshoring:
While tariffs weaken the arbitrage math, it may still hold at 25% tariffs: Most companies target up to 50–70% lower cost than onshore. My colleague Eric Simonson made an interesting point that for companies that haven’t maxed out on offshoring, one way to think is to expand offshore further – moving additional work to low-cost locations and shifting work from nearshore to offshore. This may outperform the reshoring alternative. In many cases, this arbitrage alone might more than offset tariff impacts.
Explore tier-2/3 locations:
Within India, Poland, the Philippines, and Latin America, tier-2 cities and emerging hubs offer compelling cost and talent profiles. Despite operating centers in 70+ countries, ~85% GBS headcount in offshore locations is concentrated in ~10 large cities. This clearly indicates an opportunity to diversify. GBS leaders need to investigate additional options more seriously from a long-term perspective – deploying non-core work as a start here cushions the cost base and frees prime hubs for leadership and high-value work.
Compare transition costs vs tariff costs:
A 25% tariff sounds punitive, but is it worse than the transition cost of moving thousands of jobs? Build hard models. Factor in domestic inflation risks in the US, which may drive wages higher and make onshore even costlier if reshoring scales. Often, offshore tariffs remain cheaper than domestic plus inflation.
Optimize ruthlessly:
A recent Everest Group study of 800+ GBS organizations showed that 57% leaders believe they have not standardized processes meaningfully. There is a lot of fat that GBS have accumulated. They can and must take 15–20% out of the base. Eliminate duplication, harmonize platforms, and streamline governance. Said differently, if you can lean out 20%, a 25% tariff shock becomes survivable without denting enterprise margins.
Recognize value and talent risk beyond cost:
Too often, politics and media frame offshore as low-end jobs. The reality: senior leadership, SMEs, and critical capability pools sit offshore today. Disrupting them is not just a cost issue – it risks business continuity. GBS value is often reported primarily in cost savings, so many leaders do not fully understand the value it creates, and hence, risk reacting to these flashpoints based on partial understanding. While it’s critical that GBS articulates the total value it creates, one should also remember that GBS typically costs 1–3% of enterprise revenue. Even a tariff uplift here is marginal compared to the damage from talent and value disruption.
Own the story – internally and externally:
Boards, policymakers, and employees need clarity. As Deborah emphasized, GBS leaders must hold this debate. Tariffs are a headline, but the real forces shaping the future are inflation, supply chain fragility, AI disruption, and talent availability. Communicating this in boardrooms and the press is not optional – it is survival. And now with legislative proposals increasingly tied to public disclosures and political rhetoric, shaping the narrative proactively has become even more urgent.
A resilience roadmap
While it is natural to look at the HIRE Act as a crisis, it is better to treat it as a stress test for GBS. Leaders should be sequencing actions across horizons:
| Horizon | Focus Areas | Examples |
| Immediate (0-3 Months) | Map exposure, set up tariff risk teams, estimate possible “policy premium” you may have to pay; scenario model tariffs vs. transition costs, identify “quick wins” in cost cuts and supplier contracts. | Cost takeout, dual-sourcing, automation/AI pilots, business case realignment, supplier realignment. |
| Short Term (3-12 Months) | Lean out 15–20% of base, shift incremental work to cheaper offshore or tier-2 cities, accelerate AI programs, adjust internal pricing models. | Expanded automation, renegotiated contracts, expanded offshore footprint. |
| Medium Term (1-2 Years) | Broader digital transformation, larger-scale footprint diversification, embed trade risk into planning, capture policy incentives. | Multi-hub strategy, resilience dashboards, Automation/AI-first operating model. |
The global angle
It is also important to recognize that this won’t be a one-way street. Countries like India are unlikely to sit still – expect diplomatic pushback, stronger industry lobbying, and potentially new incentives to keep its global services engine attractive. Some countries too may sense an opening: Mexico may lean on other select advantages, Eastern Europe may market itself as a politically safer location, and emerging hubs could introduce fresh tax breaks and workforce programs.
For GBS leaders, this means workforce strategy will increasingly balance cost, talent, and political resilience. The winners will be those who build a diversified, multi-hub footprint that can flex with policy shocks while still delivering value at scale.
The bottom line
GBS will not die because of these policies. But they might if GBS leaders don’t act with urgency to:
- Accelerate AI and automation
- Double down on offshoring
- Improve locations mix (add more tier-2/3)
- Weigh transitions rationally against tariff math
- Optimize ruthlessly
- Protect offshore talent pools strategic to business
- Own the narrative – now more than ever, given reputational and compliance risks
Tariffs are one factor, but they do not overturn the fundamentals. The GBS model is not just a cost take out – it is about building a strategic global capability network. In fact, handled smartly, this moment could strengthen GBS as a strategic lever – not weaken it. Remember how COVID created the strongest wave of GBS market growth ever. The winners will be those who prepare boldly, act quickly, tell their story convincingly, and factor in how the global chessboard of trade and politics is shifting.
How are you approaching your GBS strategy?
