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Infosys CEO faces tough road, fewer books

Infosys CEO faces tough road, fewer books
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First Published: Fri, Jun 22 2007. 03 29 PM IST
Updated: Fri, Jun 22 2007. 03 29 PM IST
Bangalore: Kris Gopalakrishnan loves books on courtroom dramas, history and fiction, but will have less time to read after taking over as chief executive on Friday of India’s showpiece software services firm Infosys Technologies Ltd.
Nasdaq-listed Infosys has grown from humble beginnings to a $27.5 billion global company with annual revenues set to hit $4 billion as more Western firms outsource operations to lower-cost India.
But Gopalakrishnan -- Kris to his colleagues -- faces a stronger rupee, spiralling wages, a shortage of skilled workforce and fierce competition from global giants IBM, Accenture and Electronic Data Systems Corp.as he takes the helm at India’s No.2 software exporter.
The softly spoken 52-year-old is one of the seven founders of Infosys that was set up in 1981 with $250 contributed mostly by their spouses. He takes over from Nandan Nilekani, who moves to co-chairman.
“It’s exciting, but there will be a lot more responsibility. The focus will be on me. In that sense, the responsibility increases,” Gopalakrishnan told Reuters earlier this month.
Analysts say the new chief will be under pressure to cut costs and improve efficiency to boost margins at a time when annual wage hikes of 10-15% are threatening to pinch earnings. Infosys had a payroll of more than 72,000 at end-March.
“Although he doesn’t appear to be as charismatic as his predecessors, he is the right person to lead in this scenario with his knowledge of the back-end,” said a sector analyst, referring to his expertise in handling project delivery.
“The company is anyway on auto-pilot, with a strong management team in place, but there is a requirement to enhance focus on the cost side rather than on the business side,” said the analyst, who asked not to be identified.
“Kris is gentle but firm, consultative yet decisive, thoughtful yet action-oriented,” said Infosys Chairman N.R. Narayana Murthy.
India’s big software services firms -- Infosys, Tata Consultancy Services Ltd. and Wipro Ltd. -- get over 60% of their revenue from overseas, and margins are being squeezed by an 8.5% rise in the rupee against the dollar this year on strong capital inflows.
Steady hand
Gopalakrishnan, a Masters in Computer Science from the Indian Institute of Technology, began his career at Mumbai-based Patni Computer Systems Ltd. in 1979 -- opting to stay home rather than follow many of his compatriots heading West for better pay.
Two years later, he joined Murthy, Nilekani and four others to set up Infosys, whose clients now include ABN AMRO and Goldman Sachs.
This took him to the United States, where he worked on programming for clients and doubled as salesman for deals. He returned to India in 1994.
Gopalakrishnan, son of a small businessman from the southern Indian state of Kerala, is married and has one daughter.
“He is very down-to-earth and has often rolled up his sleeves to help the team meet critical deadlines,” Srinivas Uppaluri, associate vice-president of corporate marketing at Infosys, said.
While he may have less time for his books, Gopalakrishnan will have plenty of opportunity for his other indulgence, picking up the latest electronic gadgets on his overseas trips.
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First Published: Fri, Jun 22 2007. 03 29 PM IST