Bangalore: It may be premature to write an epitaph to Kris Gopalakrishnan’s term as CEO of Infosys, especially since he is likely to influence the trajectory of Infosys over the next few years. Still, a four-year track record is not inadequate to measure the man on his performance.
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The consensus seems to be that Gopalakrishnan has done a competent, if not a spectacular job.
By nature a fairly reticent speaker more interested in the nitty-gritties of execution rather than the big picture, Gopalakrishnan inherited a healthy company from Nandan Nilekani when he took over in June 2007; at the time, Infosys had around 70,000 employees and $3 billion in revenue.
In less than four years, Gopalakrishnan has managed to double revenue while largely protecting profit margins—no small feat given the times—even as the company has added 60,000 employees. Gopalakrishnan was also dealt a tough hand; international customers reduced their spending on IT after the 2008 financial crisis.
While the last couple of quarters might have seen slowing growth, Gopalakrishnan delivered an outstanding September quarter in 2010, when revenue grew sequentially by 12% and net profit grew sequentially by 17%.
That was a quarter when Infosys grew organically by more than a $100 million, and registered the first double digit growth in around three years.
While the stock took a hit with the fourth quarter, annual results and 2011-12 guidance released last week—they were below fairly high market expectations—the fact remains that Gopalakrishnan has always been a man who has delivered, although he may not have managed expectations as well.
“There is no question that he is among the best. Of course, he is more of a sit down-and-deliver kind of guy rather than someone who handles the analysts community, who still remember Nandan Nilekani’s communications very well,” says Abhishek Shindadkar, an analyst with ICICI Securities.
Shindadkar, now that the stock fell some 10%, has revised his “hold” rating to a “strong buy”.
Another analyst, who did not want to be named because his brokerage house has a policy of not directly commenting on people, echoed similar sentiments, calling Gopalakrishnan a great operations person, strong on discipline and process, with good concepts for delivery and an understanding of how the business works.
The analyst said it was only in terms of the ability to open doors on the client side of the business that some questions could have been asked of Gopalakrishnan’s effectiveness. It will be interesting to watch what happens next, the analyst said. “Kris deeply represents the Infosys founder value system. That founder DNA is now shifting to a new kind of DNA, and it will be interesting to watch that.”