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I see Infosys as an agent of change: Nilekani

Last updated on: June 04, 2007 14:47 IST
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Rumour mills did the rounds of Indian IT industry when Nandan M Nilekani recently stepped down as the Infosys CEO. 

What made him relinquish the post in favour of S Gopalakrishnan? Have problems started brewing in the corridors of one of the leading IT companies of India? What plans does Infosys chief mentor N R Narayana Murthy have for Nilekani as the co-chairman?  Will he succeed in taking Infosys to the next level?

Questions like these thronged many minds and the only person who could provide the facts was Nilekani himself. In a long e-mail interview to Senior Associate Editor (Business) Indrani Roy Mitra, the Infosys co-chairman speaks about his new post, his company's future, dreams and aspirations. Read on...
What made you suddenly relinquish the Infosys CEO's post in favour of Mr S Gopalakrishnan?

When Mr Narayana Murthy retired in August, there was a discussion about the composition of the executive management of the board. Mr Murthy was the executive chairman and I was the chief executive officer, we were able to work in tandem. The board felt the need for an executive chairman so that this combination of an executive chairman and CEO, which had worked so well, could continue. Hence, the board decided to appoint me as the co-chairman, in an executive capacity and invited Kris to be the CEO. Shibulal has been appointed as the chief operations officer.

After taking over as the co-chairman, what will be your role in Infosys? How will it differ from or be complementary to that of Mr N R Narayana Murthy?

I will now focus on enhancing the brand equity for the company, growing the customer profile and increasing Infosys' thought leadership globally. I will take part fully in setting the strategic direction for the company and work with the CEO and COO to drive the company vision. Mr. Murthy has retired from the post of executive chairman and is now the chairman of the board in a non-executive capacity, responsible for board governance.

Infosys is the darling of the stock market and a globally recognised name? What plans do you have to take Infosys to the next level?

The global IT services industry is going through a major change -- the world is 'flattening' itself. Traditional models are no longer valid and are fundamentally delivering lower quality, with higher costs, delays, overruns, etc. Clients are increasingly dissatisfied with that. Our business model, which is based on excellence in execution, is what customers are looking for. They also want good business knowledge, consulting knowledge, domain skills and understanding of problems and solutions.

The next generation IT services and consulting firm does both -- it provides excellence in execution as well as great business problem solving skills. We aspire to be such a company.

Could you tell us about your journey to and through the IIT?

My journey through IIT could best be described as one of the milestones in my life. My four years there transformed me into a confident young man from a shy, gawky youngster. I discovered my varied interests and learned to take charge and assume positions of leadership. Here I learnt the importance of meritocracy, unbiased decision-making, teamwork and hard work.

Post IIT, I met with Murthy at Mumbai for my first job. Then, came Infosys and clearly all my learnings from IIT reflect in the manner in which I take on tasks and handle them.

Do you think more IIT-ians should walk off the beaten track and try to achieve something different? If so, how?

IIT is a platform that offers individuals the opportunity to discover what interests them and what they are passionate about. IIT provides its alumni with a launch pad that gives you enough confidence to follow your chosen dream.

The Indian economy is buoyant today. Globalisation is creating a new opportunities for the youth today. India is seen as an exciting and challenging destination for young and bright professionals the world over. As one of the few trillion dollar economies and growing; the time is ripe for youngsters to dream big and surge ahead to achieve them.

What motivated you to lay the foundation of Infosys with Narayana Murthy and others?

We were young back then and this seemed like something interesting and exciting. Plus, under Murthy, it was really like working for a company. We wanted to create a bright future for ourselves, for the Indian society and for the world at large. We had a good idea and were able to create the market for it in the G–7 countries. 26 years hence, it seems like it all worked itself out!

How did your family background and education influence you to become an entrepreneur?

Three out of the original seven founders were from the IITs. However, when we decided to set up Infosys, most people around us including family and friends said we had given up safe and promising corporate careers for a dream of building a global corporation. The environment in India at that point wasn't conducive to entrepreneurship.

But, as a bunch of young, go-getters with a sound educational background, starting a company seemed like a great idea. This gave us the necessary confidence, commitment, passion, hope and capacity for hard work. 

Where do you see Infosys five years hence?

We want Infosys to be in the top echelons of globally respected companies. At the same time, the game is definitely not only about size. In the IT services industry we have been an agent of change. We want to continue to be an agent of change and be the leader in the industry.   

Do you think the Indian growth and IT boom are sustainable? What could go wrong? What steps do we need to avoid pitfalls, if any? Can India emerge as a global giant like China? In manufacturing? In services?

India is increasing its profile and brand in the world and is widely recognised for pioneering the strength of our business model. It is an innovative and disruptive business model; a new way of doing things -- faster, better and cheaper. Our collaborative distributed development model allows us to leverage global capacity, resources and strengths to desegregate sophisticated software work and get parts of it done in Bangalore, Beijing and Boston in a seamless manner.

I believe global sourcing has become a strategic imperative for corporations as globalisation forces businesses to be lean, efficient and responsive to the customers and the market. Activities considered for outsourcing have moved up the value chain, and have begun to touch core functions like R&D. Organisations worldwide are taking advantage of technological advances and the human capital available offshore to fundamentally restructure their operating model.

With this transformation, they want to work with partners with end-to-end capabilities and those who bring business capabilities in addition to technical expertise. This environment will spur the growth of the Industry. Infosys epitomises the new next generation of IT services and consulting companies that the legacy companies in this industry are struggling to keep up with.

India's biggest strength is said to be its skilled manpower? How can it become more competent? And will India's growth falter if the cost advantage drops (especially, if salaries rise)?

Offshore wages are increasing by around 12-15 per cent in India, every year. This is not a new phenomenon but has been happening for quite sometime now. The large Indian IT players have scale benefits and are also using other levers to bring efficiency in operations to offset the impact of the wage increases.

Also, most large IT players are improving their business mix by becoming end-to-end players and also using lot of tools to improve the productivity. They have been quite successful in handling this in the past. Also, the wage differentials between the West and India are too high and it will take several years for them to converge. So, the competitive position of countries like India will remain for many more years.

What do you think about the current entrepreneurial talent in India? Are there enough entrepreneurs coming up?

The environment for entrepreneurship is ripe in India today. Venture capital funding is at an all time high. The stock markets are buoyant. There is no dearth of ideas that cannot ride on the new consumerism wave sweeping across India.

I believe that Indians, especially the younger generation, are now impatient to succeed and are running fast to be where we could have been 20-30 years ago. This burning desire to succeed is reflected in the success of our diaspora in various professions globally. It is shown in the rapid acquisitions that Indian business is making on the global market across industries such as steel, textiles, televisions, etc.

It is reflected in the spirit of entrepreneurship by individuals who are now creating opportunities and new careers for themselves. Not just that, Indians are holding their own in fields ranging from technology to painting to medical science and cinema.

The country needs to have the policies to enable true success for the entire nation. But more importantly, courage, principles, innovation and relentless focus on execution is essential to swing this tide in our favor.

Which new Indian company or companies do you think could become the next Infosys or TCS or Wipro?

We have a long way to go ourselves. I am sure as we speak there are a dozen new Infosys being created. In fact, that's what we would like for this country and for the youngsters to be doing.

What is it that you most love about Infosys?

Infosys is today regarded as arguably one of India's most transparent and respected corporations - this gives me immense pride. We have lead the way in many firsts - including being the first company to list on the NASDAQ, the first company in India to offer the ESOP plan, the first company to report our financial accounting statements in the 8 GAAP languages and more recently build what we think is India's largest corporate university at Mysore.

What do you think are the factors that have led to the tremendous success of Infosys?

Our willingness and capability to anticipate and adapt to the "flattening" of the world has enabled Infosys to leverage technology to better understand customer behaviour and to co-create with customers and partners.

Our founding team had great confidence in the model that we were building and we were sure that we would succeed in the long run. From the outset, we have always anticipated and responded to changes in our business environment. Our introduction of the Global Delivery Model in the 1980s was one of the main drivers of change. This model is now so prevalent that it does not seem unusual to offshore work to another, far-off location. We believed that this was how the future would look and started working on our model at a very early stage.

Additionally, the Infosys value system, investment into sound corporate governance policies, team work and ethics have also stood us in good stead.

How do you maintain work-life balance, given that the demands on your time must be enormous?

Time management is everything. My day is segmented and I ensure that I don't miss out on any aspect irrespective of the schedule I have. I believe in being productive and not being busy!

If IIT-ians or any young Indians today want to chase the same dream as yours, what should they do? Is there a success mantra?

I believe that the near future will result in a wider sharing of the benefits of globalisation. As the playing field gets levelled, opportunities to achieve individual and group excellence get equalised at a much faster rate than ever before. Everyone is getting empowered. From the village woman in India who has access to micro-finance to generate a larger income for her family, to companies which can tap global talent to deliver excellent products and services, there really are more opportunities for all today.

It is exciting to live in such times where there are truly no limits to what we can achieve. I am sure that if youngsters build on their natural strengths and take advantage of our global and free business environment, they will be able to make further strides like Infosys did.

Photograph: Rob Elliott/AFP/Getty Images

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