Here's why new CEO Vishal Sikka can lift embattled Infosys
Sikka's biggest challenge as Infosys CEO will be to fill the leadership vacuum created by the exodus of senior executives. There are at least five reasons why his entry may spell better news for the embattled company. Vishal Sikka is the new Infosys CEO; Narayana Murthy to step downbusiness Updated: Jun 12, 2014 14:21 IST
Dr. Vishal Sikka, named to run Infosys as its new CEO, is a far cry from NR Narayana Murthy, its executive chairman and co-founder who is due to hand over the reins to him in August. But the difference itself may just be right because the Bangalore company is entering a new era in which India, the industry and technology have all changed.
Murthy's second innings as executive chairman was controversial all the way. The company managed to improve its show in the year under his helm since last June, but high staff attrition of about more than 18% and a procession of senior-level executives leaving the company cast a shadow on the future of a company whose strength is built on talent.
Read: Vishal Sikka is the new Infosys CEO; Narayana Murthy to step down
Murthy built the company founded three decades ago through a 1990s boom in which India-based offshore services offered a global labour cost advantage and took it to a Nasdaq listing in 1999. But the advantage is now everybody's. IBM, Accenture and local peers like Wipro do pretty much the same.
To make things worse, Murthy's choice of bringing in his own son Rohan as an executive assistant created murmurs on whether he was aiming for dynastic succession in a company that prided itself on merit. Rohan is now set to move out with his father.
There are at least five reasons why Sikka's entry may spell better news for the embattled company recently lagging in growth rate behind its industry peers like HCL Technologies and Tata Consultancy Services.
1. He can make Infosys cloud-ready: Coming from SAP, which has been a successful product company, Sikka knows how to build a product. At the same time, SAP was on the Internet-based "cloud" platform long back with mySAP.com and dealt with consultants who implemented product roll-outs. With this combination, he can give Infosys a product-cum-services edge.
2. He is a global Indian: Sikka's background gives Infosys a global edge but his origins in India will make him understand the history of the company better and relate to it in a pragmatic way.
3. He will quell unrest in the ranks: With exodus at the senior level plaguing Infosys, Sikka's arrival will make him tower over other Infosys executives in a deserving, convincing manner. The murmurs over Rohan Murthy's presence that caused unrest will also be contained.
4. He brings Europe: Sikka's name will open doors in the corporate sector of Europe, where Infosys needs to grow. Largely dependent on the US market, Infosys missed a continental bus when UK-based Axon was acquired by rival HCL Technologies. The former SAP executive can bring in relationships and deals in Europe for Infosys.
5. He loves Innovation: With the cheap-labour advantage lost and the Infosys 3.0 strategy based on products and platforms yet to take off, a world-class innovation mindset is something the Bangalore company could do with. Sikka brings that to the Electronic City campus.