S Gopalakrishnan is CEO and managing director of Infosys Technologies Ltd, which turned 30 this year. He said in an interview that the mission is to ensure that Infosys is a globally respected organization that helps clients leverage technology better. He also spoke about juggling tactical and strategic matters at work, receiving the Padma Bhushan and increasing global volatility. Edited excerpts:
R&D emphasis: Gopalakrishnan says Infosys will be investing more in research and development and intellectual property creation.
You’ve just been conferred the Padma Bhushan.
It is a recognition of the work done and the potential of the industry that has created a significant number of jobs which have helped transform people’s lives. We did an informal survey of new recruits at Infosys a year back and found that 40% of the people who had joined had one or more parent who had not even completed SSC (Senior Secondary Certificate exam), or class X.
What have been your suggestions for making youth more employable?
In the short term, training and retraining needs to be conducted to fill the skill gap among youth for the jobs available. Second, we have to look at a 5-10-year horizon and the areas where jobs are going to be created and then through the education system train the youth to meet this requirement. Encouraging entrepreneurship is very important in this regard because most jobs are created in the small and medium sector. Third, if a person loses a job or changes careers, the social security infrastructure should provide retraining through public-private partnership.
The IT (information technology) industry took it upon itself to launch a massive finishing school programme which took engineering graduates from any discipline and converted them into software engineers. The industry employed 1.5 lakh people 15 years back, today it employs 20 lakh people. The top five IT companies in India will be recruiting 1.5-1.8 lakh people in the next 12 months.
Switching to management, how have you been able to retain your own style, which is perceived as being more understated than your predecessors?
Soon after I took over in 2007 as CEO, the world was faced with a deep downturn. In the financial year 2008, the year I took over, Infosys grew 35%. The next year, if I remember correct, we gave a guidance of 19% to 21% and ended up with 11%. It was the first time in the history of the company we had to revise our guidance down. That was FY2009. (In) FY2010, we gave a guidance of declining growth of 3-5%. Again, the first time in the history of the company we projected a decline. Fortunately, we ended up with 3% growth. This year, we are looking at a growth of 26%. So 35% to 11% to 3% to 26%. In my first full year, I was making sure the commitments we made were met. The quarter I took charge we grew by 6% sequentially. The remaining two quarters were difficult. The focus was on coming out strong. Now the focus is back on growth and sustainability.
Which means your style also had to change to look more outward?
As the CEO you are always the face of the company. You have to be prepared and act the role. If I can do it anybody can do it. But if you are not ready to be a leader, don’t, because you are going to let everybody else down. Previously, we had (Narayana) Murthy, Nandan (Nilekani), who were more the external face. Murthy is still there. I was internally focused. Now I am playing a role that is more external than internal.
Do you advocate coaching for your senior management?
We have a strong mentoring programme which is internal plus board members act as sounding boards. I believe in learning from others both inside and outside. From the outside, I learn from client and partner organizations. Personally, I have learnt a lot from people like John Chambers, Bill Gates. Murthy is one of the best people you can emulate.
I have received coaching in an unstructured manner which is unpredictable and, therefore, I recommend it be done in a structured manner. Some people, I think, are okay with unstructured, but most people I believe have to go through a structured activity which is nothing but discipline.
What are some of the best practices at Infosys?
On our campus, each building is different because we want our facility team and infrastructure team to innovate. We have reduced our power consumption by 15% in the last 18 months. So our new buildings are 30% more energy-efficient than older buildings. We have innovated in HR (human resources). If someone wants to make a career shift, we have a mechanism to equate levels across businesses. A person at level 6 in technology can be moved to level 6 in consulting.
You will see us investing more in research and development and IP (intellectual property)creation. The IP content in the services we deliver is changing. Some are out in the public domain. ShoppingTrip360 for retailers, a platform called iEngage, which is a social platform for employees, Supply Chain Visibility for manufacturing companies and retailers, an anti-money laundering solution for our financial services clients. Cloud (computing) is a very important initiative for us so we will increase the number of services which leverage platforms. Our recent acquisition of US McCamish Systems is to add to our capability in this space. They have a policy administration platform which multiple insurance companies today use.
What are you doing in the US to create goodwill for your brand?
Infosys Foundation has started working outside India and the first place is the US. We have tied up with the New York Academy of Sciences to launch a programme to educate children in the poorer parts of society in STEM (science, technology, engineering and mathematics). These are the things which will create an impact on society and create a different view of Infosys there.
How do you approach acquisitions?
Culture is important. So is integration. Retaining employees is very important. The right company for the right reasons at the right price is our mantra. Leadership must have similar values. We want to make sure every acquisition is indeed going to add value to our clients, to Infosys etc., like Expert Systems, our acquisition in Australia.
What was different this year at the World Economic Forum?
There was recognition that there will be tremendous volatility in the environment which can lead to unforeseen economic downturns. One month back, nobody would have predicted what is happening in Egypt now. The pace at which it has happened has surprised everybody. We had 17 employees in Egypt who were happily living there, suddenly all of them are brought back to India. One small thing happened in the streets of Tunisia. Now they are talking about changes in Jordan. Although we don’t have many clients in the Middle East, these events can have a ripple effect on the rest of the world.