News Column

SIKKA OUT SIDER @ INFOSYS

June 13, 2014



Non-Infoscian to be CEO of IT giant for the first time

INFOSYS, the country's secondlargest software services exporter, executed the Ctrl+ Alt+ Delete command in the history of appointment of chief executive officers ( CEOs) on Thursday by appointing a non-Infoscian to the coveted post seeking to boost sales of high-margin services like cloud computing and stem the staff exodus.

According to news agency Reuters, Vishal Sikka, a former member of Executive Board at German software company SAP AG, has the technical savvy to herald what analysts expect be a strategy overhaul at Infosys, which, like competitors Tata Consultancy Services and Wipro, has relied on labour-intensive, low-margin contracts from Western clients. His successor in the SAP Board, Bernd Leukert, called him "ingenious visionary". a stock market filing, the company also said that both executive chairman N. R. Narayana Murthy and executive vice-chairman S. Gopalakrishnan will step down on Saturday. Murthy will be designated as chairman emeritus from October The Board also approved the dissolution of the chairman's office and Murthy's son Rohan would leave on Saturday, when the company would hold its annual shareholders' meeting. President U. B. Pravin Rao, widely seen as one of

the internal candidates for the CEO role, was promoted to chief operating officer.

It could be, at least, a year before Sikka is able to turn around a company that was once poster child of India's$ 100-plusbillion IT services industry. Some investors say Infosys failed to move up the value-chain because its risk-averse management culture. Infosys on Thursday said that Sikka will take over on August 1 from incumbent S. D.

Shibulal, who along with Murthy, Gopalakrishnan and four others founded Infosys in 1981 by pooling together $ 250.

Sikka, 47, is seen bringing into Infosys his expertise in newer technology areas like cloud computing, which allows clients to ditch bulky and costly servers for network-based software and storage in remote data centres.

Sikka's biggest challenge will to fill the leadership vacuum created by the exodus of senior executives, many of whom were responsible for key business sectors and winning clients, analysts said. Murthy's tenure, during which he also brought in his Rohan as an executive assistant, was marred by restructuring that triggered uncertainty, factors that dented Infosys market share, dimmed its status as employer of choice for young workers and intensified investor pressure for a change of guard. "The top layer of executives are all but gone. With a new CEO coming in and from outside, there is a chance he'll hire external candidates," said Ankita Somani, research analyst, MSFL Research.


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Source: Mail Today (India)