Bangalore: For 25 years now, 52-year-old S. Gopalakrishnan has been the perennial third man at Bangalore-based Infosys Technologies Ltd. That’s the order in which he appears in the lexicon of Infoscions, as the company’s employees call themselves. Irrespective of whether they are rattling off the names of the founders, four of whom are still associated with the company, or just discussing something else, they go by the sacred order: Murthy (N.R. Narayana Murthy, now chairman), Nandan (Nilekani, now co-chair), and Kris (as Gopalakrishnan is called). From 22 June, that could change. That’s the day Gopalakrishnan takes over as chief executive officer of the company he co-founded, and in which he and his family hold a 3.43% stake (as on 31 December?2006 data—now?valued at around Rs4,000 crore).
Gopalakrishnan is passionate enough about technology to want to set up his own computers and other appliances, and is a regular listener of technology podcast This Week in Technology (TWiT).
He faces the challenge of growing Infosys at its historical rate of 25%-plus, even as global rivals such as IBM Corp. and Accenture try and replicate its low-cost delivery model. The CEO-in-waiting, however, is more worried about his firm’s ability to attract employees in Europe and the US where it gets most of its business from, and where it eventually hopes to build a front-end that will rival those of IBM and Accenture.
Gopalakrishnan, an M.Tech. from Indian Institute of Technology, Madras met Murthy and the company’s other founders at Patni, where he was employed from 1979 till he left in 1981 to join Infosys.
The new CEO of India’s second-largest software services company spoke to Mint about his agenda. Excerpts:
What are the most important challenges you see for Infosys?
Clearly, from a medium-to-long-term, there is a need to understand market requirements, and client needs from a services perspective, and also increase revenue productivity in each of these businesses. There is also a compelling need to enhance IP (intellectual property) creation, and attract the best and the brightest talent. Now, one of the biggest challenges is to look at attracting talent from a global perspective, especially in the markets we operate. But most of these challenges are evolving as we grow larger. There is also the scale challenge—how do you grow to a $4 billion (Rs17,200 crore) company from (a) $3 billion (one), especially since the base is larger. On a day-to-day basis, there are operational challenges as well. But strategically, having a right mix of services, in terms of which part of the business should be grown, and which geography, are some questions we need to answer.
Many of your global rivals, such as IBM, Accenture and EDS, have been building huge offshore capabilities in India. Doesn’t that make things difficult for you?
We have a purer model when compared to them, especially in global delivery. We have the capability to add more on the client-facing side, and grow them in an integrated manner with our global delivery centres. For us, it’s an opportunity to grow this (model) by adding relevant services. For our global competitors, the challenge is more about re-engineering their business, moving focus from one location to another in terms of building resource pools. They are also letting go of their people in the developed markets and hiring in developing locations. On the other hand, we’re not letting go of our people—we are adding new capabilities and leadership in these markets. Both of us are facing different challenges. We don’t need to re-engineer our business.
With this restructuring, Infosys’ top management looks more ‘promoter-heavy’. When will we see a non-promoter becoming the CEO, also, how are you developing the future leaders?
I think it’s an ongoing exercise, depending upon the need. If you look at two of the executive board members, Srinath Batni and T.V. Mohandas Pai; they are not actually founders of this company. At an appropriate time, we will look at the way the board is structured; of course, the board will also have its say in doing this. We actually develop new leaders and give them responsibilities for running different departments and business units. In fact, many of these businesses are larger than what Infosys was five years back, especially if you look at our banking and capital markets division, or our communication service provider practice. If you look at the top-50 people in the company, it’s very broadbased. This pool has a good mix of people who have joined at various stages of Infosys’ growth.
We have also demonstrated constantly that this is a management which believes in leadership development.