Leadership and Infosys

A group of donkeys led by a lion can defeat a group of lions led by a donkey.

Presented byGaurav PathodiaMalleswara Sastry

Key success factors of Infosys

• Sound Management Skills

• Nurturing Working Atmosphere

• Commitment To Values, Speed ,Imagination and Excellence

• Personnel Management

• Infrastructure

Other success factors

• Invest in well understood, proven product & not just R&D.• While dealing with investors, always under-promise and over

deliver.• Have a healthy sense of paranoia and respect for the

competition.• Leaders in the making.

Leadership at Infosys

“A true leader is one who leads by example and sacrifices more than anyone else, in his or her

pursuit of excellence”

-N R Narayana Murthy

“The principal dynamic force that motivates and coordinates the organization in the accomplishment of its objectives”.

Leadership styles

Although good leaders use all different styles, with one of them normally dominate, bad leaders tend to stick with

one style.

Narayan Murthy is a visionary who applied his leadership skills to build one of the biggest IT companies in India.

Stress on Building and maintaining relationships.

Innovation is the only means to sustain customer loyalty in a flattening world.

Acceleration of innovation is an imperative that organisation should address through well defined frameworkHe distributed the company’s profits among the employees through a stock option program and adopted the best corporate governance practice.

Continued

Following the PSPD model

• Predictability: The company has had long-term relationships with its key clients and this has helped it in a better understanding of the future trends in the global technology marketplace. Infosys’ repeat business levels (at 95%+ levels) are among the highest in the industry. This has helped in better visibility of growth for the management.

• Sustainability: Apart from the previous factor of long-term client relationships, the company has, over the years transformed a large number of its customers into partners, which whom the company has build on innovative processes and technologies. This has provided the much-required sustainability to the company’s growth.

• Profitability: As mentioned before, Infosys has been gradually moving up the value chain. While this has impacted margins in recent times on account of a higher onsite proportion that these services carry, the fact that a lot of these are being gradually moved offshore will help the company pare margin decline. Rising contribution of high-value services also aids improvement in the productivity levels.

• De-risking: The company has been gradually shifting its revenues from the US region to other large markets like the EU and Asia Pacific. Apart from this, the company has also reduced its exposure from a few clients and now has one of the largest client bases in the industry. These moves are all in line with the company’s aim of de-risking its business model.

Advantages

• Higher margins

• Higher predictability of revenue

• Stronger relationship

• End to end service providers

On Hold for a Year• Murthy described several of the obstacles to doing business in

India in the early 1980s. "It took us a year to obtain a telephone connection, two years to get a license to import a computer, and 15 days to get foreign currency for travel abroad. Thus, the first ten years of our marathon seemed interminable and frustrating. Although we managed to keep our heads above water, we were floundering."

• Leadership Style: Infosys believes that leadership is one of the most essential ingredients of organizational success which is provided by its Chairman, N R Narayanmurthy. Leadership is based on high business vision and predominantly supportive styles. There is emphasis on developing leadership qualities among employees. For this purpose, it has established “Infosys Leadership Institute”. Top management emphasizes on open door policy, continuous sharing of information, takes inputs from employees in decision making, and builds personal rapport with employees. As we have seen over last few years, we have seen smooth transition from N R Narayanmurthy to Nandan Nilakeni and from Nandan Nilakeni to Kris Gopalkrishnan without any adverse effects on the company outlook and each one has proved to be an able leader taking company forward.

• The company emphasizes on training and development of its employees on continuous basis and spends about 2.65 per cent of its revenues on up gradation of employees‟ skills, and around 50% as employee costs. In spite of thousands of people joining every month, Infosys has been able to maintain its training standard mostly due to its highly matured processes capabilities and investment in infrastructure.

• Shared Values: Values are important part of Infosys’s organizational culture. In fact its tagline depicts how much emphasis it lays on core values. The core values are: • Customer Delight: A commitment to surpassing customer expectations. • Leadership by Example: A commitment to set standards in business and transactions and be an exemplar for the industry and teams. • Integrity and Transparency: A commitment to be ethical, sincere and open in our dealings. • Fairness: A commitment to be objective and transaction-oriented, thereby earning trust and respect. • Pursuit of Excellence: A commitment to strive relentlessly, to constantly improve ourselves, our teams, our services and products so as to become the best.

• Infosys got its first joint venture partners in Kurt Salmon Associates. Gopalakrishnan played the main role in this joint venture. But it got collapsed in 1989 and Infosys came into almost dying stage. Gopalakrishnan then told Murthy that they had nothing after eight years of trying to bring up a company. Those who studied with us had cars and houses. The company was on the verge of collapse. One of the founders of Infosys, Ashok Arora decided to quit. The other founders did not know what to do. But Murthy had the courage of conviction. ‘If you all want to leave, you can. But I am going to stick (with it) and make it,’ Murthy told them. This was actually courage and firm determination of Murthy, which finally saved the company.

Some of the traits that differentiates him from others are :

• Simple living-high thinking• Under-promising & Over-delivering:

He has tremendous respect for people and sound philosophy of “under-promising & over delivering”. This helps him build a healthy long-term relationship with his colleagues, employees, family, friends, business associates and network of shareholders.

• Pioneer in HRM• Performance Oriented• Strategy: ( Customer is the King)• Social being

People Management

• Infosys’ retention capability was a function of both of its rigorous selection procedure as well as proactive HRD practices.

• About 80% of the middle & senior level executives were promoted from within the organization.

• Provides many facilities which were intended to take care of both professional & personal needs.

People Management

• Infosys was one of the first companies, to adopt an Employee Stock Exchange Option & create additional wealth for its employees.

• Best Reward Systems – High salaries by industry average for software companies.

• Encouraged communication with each other & with higher management.

• To improve communication, the MD sent mails every fortnight.

People Management

• Groupism was not encouraged.

• Ideas that are great, deserve cheers and should be encouraged.

• Everything is judged in merit. Ego doesn’t come into picture. Transactions were zero-based so there is no history sheet.

• The organization should have one goal & one vision.

Infosys’ Corporate Culture

• The first rule was never to use corporate resources for personal benefit.

• The second rule is that the company treats all its stakeholders, be they customers, employees, shareholders, vendors, or society with fairness, honesty, and transparency

• The third rule is that all people are to be treated with equal respect

• The fourth rule is that all discussions are issue based. This principle means that important issues are debated fiercely, if necessary, without degenerating into personality conflicts

• Senior management has an ‘open door’ policy, and it is common to see employees discussing their issues and concerns with members of senior management

“We have always viewed Infosys as a vehicle for creating wealth for our employees”

• Thus, Infosys became the first Indian company to offer low-cost stock options to most of its employees. Based on seniority, over 60% of employees are eligible to receive stock options. With the run up in its share price, this practice has created many millionaires among the ranks of employees. An unexpected bonus is that employees now focus on adding value to the company so that its stock price continues to appreciate.

-Murthy

How far can you go???

Thank you