Financial Daily from THE HINDU group of publications
Saturday, Aug 13, 2005
Infosys, 25, raises bar to global scale
Hyderabad , Aug. 12
FROM a $250 worth start-up with seven youngsters in a 100-sq.ft-office space in Mumbai 25 years ago to a $2-billion company today, Infosys Technologies has come a long way.
With about 40,000 people on board, it is now time to ponder over and chart out new strategies to make it one of the largest IT services multinational corporation employing people from different races across the globe - - in effect an Indian MNC.
Announcing the beginning of the silver jubilee celebrationsfrom its Hyderabad development centre here on Friday, Mr Narayana Murthy, Chairman and Chief Mentor, said "we have completed 25 years and look ahead, ready to face challenges. A healthy sense of paranoia and respect for competition prevents complacency and ensures organisational learning continuously."
Highlighting the strengths of the management team at Infosys, Mr Narayana Murthy said "we have a depth of leaders within the organisation with over 500 being part of our leadership training and mentoring programme. This would be expanded to 5,000 as we grow larger. The de-risking strategy at Infosys ensures that there is a back-up for every position and that decision-making is participatory across the company."
Infosys has posted consistent growth in revenue and profitability for over the 49 quarters since it got listed in India. The company has institutionalised performance and accountability. "As a company we render obsolete our own innovation rather that our competitions doing it," said Mr Murthy."Infosys' focus has been to align its operations based on business imperatives. If you take the Finacle experience, we have made it a financial services division. In large number of banks, both public and private in India, and in some 38 countries, this product has been successfully deployed," he said.
Asked whetherInfosys would displace TCS as the No.1 IT firm in India? Mr.Murthy said "the Tata group is an organisation whose contribution to the economy needs to be seen in the right perspective. So deep is its impact that we need many more such large corporations. Having said that, I am paid to be better than the competition - - both Indian and MNCs.From about 5 per cent of TCS' revenues 10 years ago, it has now come to about 91 per cent. I have a job to deliver".
IT'S TIME TO TOAST: Mr N. R. Narayana Murthy, Chief Mentor, Infosys Technologies, and Mr Nandan Nilekani, CEO, in a happy mood outside the company facility at Cyberabad on Friday. - P. V. Sivakumar
On the challenges facing the company, he said, "The ability to scale up without losing quality and predictability and adopting to changes in the market place. As opposed to traditional solutions provider in a reactive manner, now we need to make this entire approach more proactive suggesting companies how to handle change thereby bringing in a lot more consultancy services."
Mr Narayana Murthy said "to retain trust of investors, it is better to under-promise and over-deliver. Investors understand that every business will have ups and downs and want us to level with them at all times. They want us to give them bad news pro-actively and as early as possible. Therefore, when in doubt, disclose."
Summing up his vision, Mr Narayana Murthy said, "I want Infosys to be the most respected company in every country that it operates, just as we have received respect in India."
Expansion in Hyderabad moves into fast track
INFOSYS Technologies Ltd plans to expand its Hyderabad operations with possible addition of about 5,000 people over the next two years.
The company is negotiating for a 250-300-acre site near Hyderabad to fuel its expansion drive in Hyderabad, where it currently hosts about 4,000 people in a campus spread across a 50-acre land.
The Chairman and Chief Mentor of Infosys, Mr N.R. Narayana Murthy, said, "I met the State Chief Minister, Dr Y.S. Rajashekhara Reddy, and discussed our plans as to how Hyderabad has been now put under a fast-track agenda. We may consider picking up about 250 to 300 acres in addition to 50 acres we have in the present campus."
The Hyderabad campus of about 6 lakh sq.ft, created with an investment of Rs 225 crore has grown to host 4,000 people in four years with revenues of $165 million (Rs 731 crore).
Another facility, about 6.19 lakh sq.ft, is expected to be completed early next year.
"We have acquired a company in Australia and have created a consulting company and are on the look out for good buy-outs. We look at companies for acquisitions based on whether they offer us downstream opportunities," he said.
China is top on the agenda and offers scope for further expansion.
When asked if they were concerned about growing competition from the likes of IBM, EDS and Accenture, Mr Murthy said, "They (MNCs) are playing the game that was evolved by us. We have learnt a lot from them and vice versa. As the opportunities grow, all of us will grow."
The Chief Executive Officer of Infosys, Mr Nandan Nilekani, said, "The company's European business has grown significantly from 15 to 23 per cent and offers further scope for growth. Areas such as consulting services, business process outsourcing and quality testing related business offer scope for growth."
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