Kris Gopalakrishnan, Executive co-Chairman, Infosys, led the company through the recession and recently passed on the CEO baton to SD Shibulal. He talks to Virat Bahri on the Infosys leadership and succession model and what will be expected from the future leaders of the company
B&E: In your consulting foray, competitors are quickly scaling up through acquisitions. Do you feel that puts you at a disadvantage?
KG: We do look at acquisitions. It’s just that we have certain criteria. If we find the right company, we will go for it. For us the key is to ensure that we do not depend only on acquisitions. They may or may not happen. We have to ensure robust processes entirely for innovation. We have about 65% of our current revenues coming from services introduced in the last 6-7 years. That shows tremendous amount of renewal. Last year, we grew almost 26%. If you compare to our peers, it is almost right at the top even though we have done far fewer acquisitions.
B&E: Infosys is viewed as relatively conservative due to its policy of retaining huge cash. Does that affect your investment plans?
KG: We are investing. We are investing in sales and marketing. We have expanded in Europe, North and Latin America and have created development centres. We are investing $120 million in China to create a delivery centre. We have invested in new services – cloud-based and platform-based solutions. In fact, our investments go beyond sales and development; we invest a lot in giving maximum training & development to our employees; second to none in the industry. No other company gives 6 months training at entry level. It’s just that our business model calls for significant cash generation because we are a technology company and believe we need to have significant cash in the balance sheet. One it gives us confidence to run the business; two it allows us to look at acquisitions; three it allows us one full year to reconfigure the business even sans revenues (worst case), so we don’t need to fire any employee. If you look across the technology world, Apple has $80 billion of cash, Microsoft has over $40 billion, and even Oracle has a lot of cash reserves.
B&E: How important is it for the new leader to be risk taking? Are you a believer in disruptive changes?
KG: We always look for disruptive changes. But a leader must take calculated risk and understand the consequences. Complete analysis and understanding of the situation has to be undertaken. You must realise that as a leader, you have to worry for the jobs of the people, customers, et al. This is a marathon, not a 100 metre sprint. Ensure that you are creating an organization for the long term. We have taken risks – investing in people & capabilities around the world, second to none. We have build 25 million sq. feet of campus space in India, expanded in Australia and invested in Finacle. There are 2500 people in the development group (R&D) at Finacle.
B&E: What will the strategy for a future leader at Infy when it comes to handling stakeholders, particularly governments where there have been some issues of late?
KG: As we get bigger, a larger number of our employees will be from around the world; we currently have 1000 in China, 2000-2500 employees in US, et al. We have to connect with the governments & build relations in a positive way. We can help in development and they can help IT companies & industry. Infosys has always advocated for the industry at large. We approach governments as spokespersons for the industry and all CEOs have had larger platforms to operate. I am head of CII (Southern Region) & part of the Indo-US CEO forum. IBM and Accenture have more employees in India than anywhere else. So they have a greater stake in India than they have outside. But localising is a challenge for any company today.
Read more...........
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
B&E: In your consulting foray, competitors are quickly scaling up through acquisitions. Do you feel that puts you at a disadvantage?
KG: We do look at acquisitions. It’s just that we have certain criteria. If we find the right company, we will go for it. For us the key is to ensure that we do not depend only on acquisitions. They may or may not happen. We have to ensure robust processes entirely for innovation. We have about 65% of our current revenues coming from services introduced in the last 6-7 years. That shows tremendous amount of renewal. Last year, we grew almost 26%. If you compare to our peers, it is almost right at the top even though we have done far fewer acquisitions.
B&E: Infosys is viewed as relatively conservative due to its policy of retaining huge cash. Does that affect your investment plans?
KG: We are investing. We are investing in sales and marketing. We have expanded in Europe, North and Latin America and have created development centres. We are investing $120 million in China to create a delivery centre. We have invested in new services – cloud-based and platform-based solutions. In fact, our investments go beyond sales and development; we invest a lot in giving maximum training & development to our employees; second to none in the industry. No other company gives 6 months training at entry level. It’s just that our business model calls for significant cash generation because we are a technology company and believe we need to have significant cash in the balance sheet. One it gives us confidence to run the business; two it allows us to look at acquisitions; three it allows us one full year to reconfigure the business even sans revenues (worst case), so we don’t need to fire any employee. If you look across the technology world, Apple has $80 billion of cash, Microsoft has over $40 billion, and even Oracle has a lot of cash reserves.
B&E: How important is it for the new leader to be risk taking? Are you a believer in disruptive changes?
KG: We always look for disruptive changes. But a leader must take calculated risk and understand the consequences. Complete analysis and understanding of the situation has to be undertaken. You must realise that as a leader, you have to worry for the jobs of the people, customers, et al. This is a marathon, not a 100 metre sprint. Ensure that you are creating an organization for the long term. We have taken risks – investing in people & capabilities around the world, second to none. We have build 25 million sq. feet of campus space in India, expanded in Australia and invested in Finacle. There are 2500 people in the development group (R&D) at Finacle.
B&E: What will the strategy for a future leader at Infy when it comes to handling stakeholders, particularly governments where there have been some issues of late?
KG: As we get bigger, a larger number of our employees will be from around the world; we currently have 1000 in China, 2000-2500 employees in US, et al. We have to connect with the governments & build relations in a positive way. We can help in development and they can help IT companies & industry. Infosys has always advocated for the industry at large. We approach governments as spokespersons for the industry and all CEOs have had larger platforms to operate. I am head of CII (Southern Region) & part of the Indo-US CEO forum. IBM and Accenture have more employees in India than anywhere else. So they have a greater stake in India than they have outside. But localising is a challenge for any company today.
Read more...........
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
