Vishal Sikka, CEO Infosys under proxy fire

SUMMARY:

Infosys is, once again, under fire. This time from proxy advisors with an agenda but no identified client. Still, the ignorant Indian media pick it up. Shame on them.

Vishal Sikka – CEO Infosys

Disclosure: I’ve known Vishal Sikka for many years, I consider him a personal friend and he has been a personal client in some years. Infosys, the company of which he is CEO has been a premier partner. Neither I nor my company has had a professional or monetary relationship in the last year. 

Last evening I saw a shocking article entitled Advisory firms back Murthy’s stand on Panaya deal report.

The ongoing spat between the Infosys board and N Murthy’s clan of co-founders who, at least in my mind, laughingly refer themselves as ‘promoters,’ had largely been limited to judiciously leaked Indian press content for reasons that seem divorced from any commercial reality I understand.

The founders have poked at Infosys governance, primarily over the Panaya acquisition, claiming, among other things value destruction. I find that argument hard to sustain  because according to calculations, the founders have benefitted from some $300 million in dividends the last couple of years. Thats on top of the billions they still hold in capital value.

What I do know is that in SAP/Oracle deals, consultants tell me that having Panaya in the toolkit helps close deals.

This latest article ratchets the story. Here is what we see.

Proxy advisors are usually in the mix to create trouble such that the board of a company is forced into making significant changes designed to drive perceived shareholder value.

In this case, the motivation is far from clear but article writers Business Line chose to go with this quote without questioning the underlying reasoning from Ingovern, the company they chose to cherry pick for the purpose of a headline:

 “There is merit to what the founders are saying and enough reasons for Infosys shareholders to be worried,” he said.

Note that Business Line didn’t bother to ask the obvious question as to what ‘merit’ means. Neither did they ask on whose behalf Ingovern are acting.

To put this in context, the founders have waged a nit picking campaign at the Panaya acquisition to the point where Infosys was compelled to engage an independent review of the transaction. Infosys came out of this with a clean sheet. At the time, CEO Sikka said:

“There is a lot of irresponsibility and maliciousness in what you see. You don’t appreciate that… the people who are feeding the wrong stories to the media,” said Sikka, at pains to point out that he wasn’t referring to the promoters of the company. “Lot of people, bystanders, the Monday morning quarterbacks. It is a price you pay for being at Infosys. I try to not let it get to me. Life is too short.”

That was not enough for the founders. They insist on having the independent report is put into the public domain along with further questions around the relationship between Infosys and the Panaya shareholders.

For my part, I have to ask – what does Murthy & Co expect to achieve and for what purpose?

When Sikka was appointed in 2014, it was on the back of moribund performance at an iconic but failing Indian outsourcer that clearly had no idea how to transition to the 21st century services model.

At the time, I counseled Sikka on the difficulties he’d likely face at an Indian heritage company that he believed (and still does) can transition to software and services based upon a fresh model with which the company was largely unfamiliar at the time.

Sure enough, Sikka quickly faced plenty of passive aggressive resistance from inside a Bangalore centered management that could neither understand nor accept the problems the company faced. Management changes followed and, as you might expect, Sikka brought in a slew of his people to assist in the transition.

Fast forward three years and, as you might also expect, a bunch of those Sikka brought over had enough of the Indian bullshit around what can and cannot be done and who decided to walk.

Chief among them are people like Michael Reh, Sandeep Dadlani, Ritika Suri, Sanjay Purohit and others. Looking from the outside, it is always hard to watch good people walk away but understandable when the internal organization is undergoing massive and painful change.

Most recently, Sikka has defended the exits, saying on video that the number of top flight people lost is well below industry norms. In that context, I think about the slew of top SAP executives who have recently departed. Did anyone notice?

Thinking through the events and specifically the ongoing reported attacks on the board, it is hard to understand what Murthy & Co expect to achieve. They represent a failed past yet seem unwilling to let go and allow the current professional management get on with its job. As my friend Vinnie Mirchandani said on Facebook:

Infosys must be an extreme example of how founders and early execs continue to meddle years after they should have retired and played golf. They insist on showing up in customer visits, speeches at events, shareholder events etc

Must be incredibly tough to be an outsider exec like Vishal Sikka

Where to now?

Rumors persist and while we have no dog in this fight I called up Sikka to get some answers. He is adamant that Infosys can transition and that he wants to be the person to deliver that. He called up examples of autonomous vehicle experiments inside the company campus that both delight and hold promise for the future. Asked whether he was under pressure to step down the answer was an emphatic ‘no.’

Asked if he has the confidence of major shareholders, Sikka said he has no reason to believe major investor representatives have lost any confidence. On customers Sikka confidentially pointed me to brand leading customers who are looking to expand engagements.

As a final question, I asked how he responds to the drip feed of what I see as founder driven poison on a company that, left to its management, stands a decent chance of successfully navigating the very difficult terrain of labor arbitrage that has supported the Indian heritage outsource business for so many years but which will not survive into the 2020s. His answer:

We have amazingly talented people who are inventing things that could not have been possible a few years ago. That’s worth celebrating. The design thinking and Zero Distance initiatives are working. You see those in the stories our clients tell. Go ask them.

What more do the diasaffected founders want? A return to a failed past? For myself it says a great deal that the founders chose not to attend the AGM and raise their concerns amongst peers, but instead choose instead to continue a salacious campaign among an ignorant Indian media hungry for juicy but unhelpful content. Shame on them for not doing their homework.

Image credit - via the author

    Comments are closed.

    1. Arjun Balachandran says:

      At last, someone’s tearing through the hype and the haze created by the media. Thank you, Sir ! As a shareholder, I am very satisfied by the progress made by Mr Sikka, so far. Any change or transformation is extremely difficult to effect. Complications are bound to arise. What’s saddening is that battles are being fought through the gossip-hungry media. Anyhow, I certainly hope that Mr.Sikka continues to keep up his transformation efforts. My prayers and best wishes to him. Also, hope good sense prevails, ultimately !

    2. InfyChallenger says:

      With all due respect to you, for all the support you have lent to your friend Mr. Sikka on this article, you have not put a single number up there that says why and how he is doing a good job. All the numbers say that Dr. Sikka has failed to turn this company around. He has not done one big deal, one big acquisition, grown any one vertical significantly. All he has done really is to bring a lot of SAP folks (75% of them have left disillusioned) and talk endlessly about AI and Machine Learning and how it will transform. Hello – you are not Google, Apple, IBM to talk about all that. You cannot do even a simple platform on AI and sell it for $50M. 95% of the platform deals in Infosys are sold for piddly dollars, mostly free, as POCs. I am not sure what Mr. Arjun Balachandran writes above. The stock has done NOTHING for last several years and he is praying and wishing best. If you had taken that money and put it in YES BANK or Maruti or some such, it would have tripled by now. And Mr. Murthy is absolutely right – the governance is damn shady. Why is Infy not going public on Rajiv Bansal severance or any such. If you have nothing to hide, disclose and be done with it. Why such severance is being paid only to him? So this is all surely shady and Mr. Murthy is absolutely right in questioning. And finally, please don’t think that it is all about media – yes media noise is always there but a lot of this is about failure of leadership and the complete inability of Infosys to compete against TCS or Cognizant.

      1. says:

        When anyone starts a missive ‘wth all due respect’ that almost always means they have no respect. I address your points below but one I missed – Bansal’s departure.

        I have not spoken with the company directly about this so there is an element of conjecture. The terms under which executives join or leave a company do not have to be matters of public record except as prescribed in SEC and other regulations. These are matters for management alone.

        It seems that Bansal made a case which he lost out on when the matter was considered by the board and the due diligence team. As CFO, he may have considered that put him in an untenable position and therefore the best thing was to leave. It may be that his objections led to a lack of trust by the board and they asked him to leave.

        Bansal would have been entitled to compensation per his agreement with Infy but in any case, there is almost always a margin of discretion for management to make whatever settlement they think is fair and reasonable. It is NOT a matter for outsiders and that includes shareholders.

        Waving the transparency flag is easy but when you know that will lead to yet another round of ‘Sikka is paid too much….so is…etc etc’ then as a management, you have to make the call about the distraction risks.

        Sikka will almost certainly never do this because he is far too polite but this is, once again, a topic upon which everyone needs to STFU and let management do its job.

        The fact is that he still enjoys the support of the major institutional investors and until such times as that changes then the founders need to stop meddling. It is THEY who are destroying shareholder value.

    3. says:

      OK – I’ll address these points in context. But before doing so I’ll make the point that while Sikka might be a friend, which I disclose in full, doesn’t mean he gets a pass. Similarly, if you think there is undue bias then you don’t have to carry on reading.

      1. Numbers – have you checked the results the last 12 1/4s? Utilization, attrition, profitability etc. Check through our archive – there’s plenty of meat on that bone.
      2. Deals – deal values and deal types across the board in the industry are shrinking and have been since 2012.
      Anyone thinking there are blockbusters around the corner is clueless. Check IBM on that one.
      3. Acquisitions – well they bought Panaya which, it seems, some people don’t like. Then there’s leverage. Infy has been a value based business for some time so without considerable restructuring, the ability to use the BS is limited.
      4. What did anyone expect in terms of a turnaround? These things take many years and especially in a company that is essentially a single line business. I believe you can look at the numbers and draw some comfort there. BTW – did you check Cognizant layoffs?
      5. AI/ML etc – it happens to be Sikka’s doctorate topic so I think he has the right to speak on that more freely than others. Speaking of which, do you actually know any of the projects they have delivered? I do. And I have recorded some of them. Check our archive. Check out the last Q where he talked 10% of revs and 50% of new billings on new products that didn’t exist 2 years ago.
      6. Senior staff leaving. He has addressed that. In some cases, they got great offers they could not refuse. I know of at least 3 where that applies. In other cases, they were burnt out. In other cases, yes, disillusioned. It happens. Having a stifling management system that doesn’t allow PMs to buy clients a sandwich without an approval doesn’t exactly promote an enthusiastic team.
      7. Infy addressed Murthy’s concerns and still he’s not happy. That’s not my point. It is the whispering campaign he and his buddies are conducting to undermine the board that is disgraceful. This latest bit of salacious claptrap is but another example. If Murthy doesn’t like what he sees then he has 2 options: sell out and shut up or get enough support to fire Sikka and replace. From what I can see, there is no-one willing to take on this challenge and Murthy doesn’t have the institutional investor support. Ergo – he needs to shut up.
      8. This is not new. When Sikka got to Infy he was faced with a management too fat, happy and comfortable where loyalties were clearly tied to the previous management and who were not willing to comprehend anything other than an age that has passed. Do you have any idea how hard it is make change stick in those circumstances short of a total clear out?
      9. Finally – shareholder value is a complex mix of many factors. One of which is media sentiment. How much of current stock value do you think is tied up in the ongoing bullshit? Oh – and by the way – if your only measure for success is the stock price then you have zero understanding of what it takes to run a people business.

    4. Rl says:

      Very well articulated Den.

      1. says:

        My bone doctor says the same!!

    5. Avi says:

      Dear Den

      You have summed it up nicely that NRN does not seem to have institutional support to oust Sikka hence he should shut up (earlier comments include playing golf etc)

      That unfortunately is the dilemma founders live in especially Icons like NRN who have lifted an entire generation of middle class India aspirations and helped achieve dreams considered impossible due to our socialist past.

      I agree that Dr. Sikka enjoys the board/institutional support currently and has had a stint as an enterpreneur (sold his company to SAP). He is also a product /tech visionary wanting to move an iconic company like Infosys in new directions and he has also removed some deadwood from Infosys past mgmt layers.

      However you need to have lived the life of an entrepreneur to understand NRN’s anguish. NRN could have easily made his billion selling off Infosys and still play golf (HE DID NOT in circumstances far more dire/fatal than today)

      NRN can be faulted for a lot of things …but commitment to wellbeing of Infosys is certainly not one of them . And corporate governance is what NRN would die than let go . You have to be an Infoscion to even understand how core that is in Infy DNA.

      Dr Sikka has brought an American style culture of high pay top mgmt/ fire low levels to a conservative company which at its core believes in compassionate capitalism. Truth however is far different. The mgmt leadership of today is still far from the visionaries who deserve million dollar salaries.. Half of them are open bootlickers who would not know the ‘T’ of technology.

      Rumours of payoff in acquisitions, payoff to CFO to shut him up and exodus of the exalted ’14’ from SAP etc are symptoms of , I believe, fly by night operators who joined the gravy train to make a fast buck. I do not agree that the ex-SAP guys left out of frustration of being unable to implement their revolutionary changes at Infy… Far from it…Half baked ideas and idiotic acquisitions which add no value were their undoing in my humble opinion.

      To sum up, Dr Sikka is a product guy caught up in an Iconic services company with no guidance from board. To my mind NRN should have continued as a mentor role to Vishal for some more time instead of signing off completely from Infy (but thats past , you cant turn the clock back).

      Disclaimer : I am an ex-Infoscion who worked in Infy for 15 yrs and currently an entrepreneur/ startup .

      1. says:

        If Bansal was paid off as suggested then why is he suing the company? Makes no sense.

        I agree with the product v services issue but from my conversations with V he is very well aware of that problem.

        I hear you on governance but then the company has had plenty of run-ins in past years.

        Open bootlickers – no comment but then what does V do? He had big HR issues when he arrived that were being solved but then he lost a colleague who died but who was helping to speed up processes etc.

        Do not agree re the various hires. I know a number of those people and the circumstances under which they left. I could talk detail but those were private conversations.

    6. InfyChallenger says:

      Mr. Den – spirited defense. When I meant ‘due respect’, I meant it. It seems like you are offended by my points and so you are not able to see the due respect as it is due. Never mind.

      I am not answering your other points in detail simply because they have no data to back up other than ‘look at archives’. Also I see that you are reading these things from press. When you were/are an insider, you get what really happened. Also why archives are needed? It is plain that company has not been able to grow, it is obvious that leaders are leaving by the dozens. The gap between TCS and Infosys is now 100% from 40%, the gap between Infosys and Cognizant is 35% and so on. Margins are also dropping. Dr. Sikka doesn’t know which vertical to specialize in, what deals to close, which companies to buy. Ask him the direction and he will start with ‘automation and innovation are driving the next..”. Dr Sikka is a great intellect and will be a terrific fit elsewhere but he cannot make this company successful. He doesn’t understand services.

      More importantly,

      You or for that matter, NOBODY, has the right to say Shri NRN has to shut up. As Avi said beautifully ”
      NRN can be faulted for a lot of things …but commitment to wellbeing of Infosys is certainly not one of them . And corporate governance is what NRN would die than let go . You have to be an Infoscion to even understand how core that is in Infy DNA”

      That 3 lines by Avi is the most beautiful lines I read on Infy ever. If you had worked in Infosys during NRN time (and I have in the past), you would have known that is a SACRED LAND OF VALUES, it is not “the goddamn professional company” that will bend any rule the way it wants, it is a temple he built not a corporation. It is not something you can understand because you simply dont have the experience – no offense to you – you just dont know what it feels to be NRN-ethical, we ex-infoscions know. Not a single thing was done unethical there. And now, every thing is being swept under carpet including hush money, reports that have not been made public, ridiculous salaries, what not. And Shri NRN is not able to sleep. Many of us are also not able to. And it is imperative that is cleaned up.

      Rest my case. Again respect your opinions. No offense to you. To each his own.

      1. says:

        You go to the nut of the problem. It seems that everyone who criticizes wants it both ways. Leave the company alone, keep it as it was invented but keep making us money. That’s not possible. Everyone with skin in the game knows thatl.

        To the issue of Murthy shutting up – well – he can’t have it both ways either. You’re either in or you’re out. If you’re out but are genuinely concerned then you make damned sure you get alongside the problem and actually help rather than throw rocks from the sidelines, using a medium that is only interested in a headline.

        Last I heard, ‘sacred land of values’ doesn’t make a dime. So while I have no doubt whatsoever that what you say is a fair assessment, it won’t get the job done that’s needed. On the flip side, I’d ask you to consider V’s internal ratings among those who have to do the work. As I understand, the rank and file are just fine. It is the ‘old’ management that have a misplaced loyalty to the past.

        You cannot credibly make accusations about ‘hush money.’ A review was called for, it was done and gave the company and its people a clean sheet. That’s it. You either accept that or shut up because you are not managing the business. As I said above – if Bansal was ‘shut up’ then why is he suing the company? Makes zero sense.

        1. ClearTheFog says:

          Bansal is suing because second part of his payments have been stopped once this issue has come to light. It’s in the public domain.

    7. Rajan says:

      Hi Den -my open letter to vishal. You are defending an indefensible. Sikka is a failure on all fronts. He is lucky that infosys is an Indian company. If it is a US company, somebody would have sued him. I can understand your anguish in helping your friend. But, touch your heart and be truthful. As you know, Karma is a bitch.

      EMPEROR HAS NO CLOTHES….

      Dear vishal,

      First of all, congratulations on completing 3 years at Infosys. While you have tom-tomed your progress in the last three years, the end result does not show a path to heaven. Let me explain.

      Infosys was known for its integrity and transparency. Its shares used to command a premium to rest of the players in the industry due to its superior governance structure. That premium had been completely lost under your leadership. The company which was seen with awe and splendour earlier had become more pedestrian now. All credit to your great pathetic leadership.

      All the stakeholders had suffered under your leadership. First let us take the shareholders. You took charge as CEO on August1, 2014 which is in the middle of a quarter. Your full contribution as a CEO cam from Q3 of FY 14-15. The infosys stock is up by 4.5% in the last 3 years from Rs.937.50 to around Rs.980 today. This is just 1.5% each year and even if you include the dividend yield of 2-2.5%, is is way below the market and your peer group performance. In short, adjusted for inflation you had actually destroyed shareholders value.

      Second, let us take the employees. While the senior management including you had did-proportionately benefited from obscene salaries and options, rest of the organisation got peanuts. The freshers had not got any salary increase; the variable salary had been mercilessly cut for mid-level; ruthless cull out of middle level employees had happened; and you brought in a coterie of “yes men” from SAP paying very high salaries. You had surrounded yourself by sycophants while you ran the company like a maglomaniac.

      Third, let us look at your strategy. All your acquisitions had failed. Panaya was a suspicious acquisition which seems to have benefited few from your coterie. The write back of earn outs in majority of the acquisitions clearly shows that they had not met the original intent. With huge good will sitting in the balance sheet you created a monster which will haunt the company in future.

      Fourth, let us come to your grand new services. You had cited in several instances that the revenue productivity had gone up, the strategy of moving to products and solutions are working, etc., but, the proof of the pudding is the employee revenue productivity. As per the official infosys data sheet, the employee revenue productivity was $51.9K in fiscal FY14 and is same at the end of Q1FY 18. With flat revenue productivity the whole story of products and moving up the value chain falls flat. All my friends at Infosys laughs sarcastically on your transformation story.you had been talking. You had actually lied when you said the per-capita revenue had increased under your regime.

      Lastly on governance, only great achievement by you is to convert an iconic, well respected company into a pedestrian company. The illegal payout to rajiv bansal and David Kennedy, surreptious increase of your own salary without proper performance criteria and disclosures, the suspicious acquisitions; and use of corporate resources for private use, all happened under your noose. The two whistle blower complaints were quite damning and raises more questions than answers. The investigation done by the board is laughable and all the key players like Ritika Suri leaving the company tells a different story.

      In total, infosys has a weak board with a maglomaniac CEO. Any good company will have in place good checks and balances which is lacking at Infosys. The founders have created such environment which is badly missing today.

      You don’t have anybody at Infosys who will come to the board and the CEO and say,”Hey emperor, where are your clothes?”

      Regards,

      Rajan

      1. says:

        Accusing the CEO of lying and illegal activity is a big charge. I hope you can back it up. Using pejorative language on salaries is hardly helpful. Good luck on getting a hearing with management when you take these positions.

    8. Raghunandan says:

      If bansal money is not hush money then why David Kennedy kept the board in the blind on his settlement? Why th board, the nominations committee and audit committee had not approved and minuted that in their board/committee proceedings. Why the CFO refused to sign the SOX certification? Why this payment was post facto approved by the board? Why this payment was stopped abruptly? Why the investigation had not gone into the mails of David Kennedy. Iam an insider and knew what happened. It was purely a hush money paid to silence him not to reveal the wrong doings. You are in US and have no idea of what happened. Don’t just blindly believe what vishal says….

      1. says:

        I’m not in the US and FWIW, we have never discussed this issue.

        Be that as it may – the investigation found no fault.

        I keep coming back to the point – what business is it of anyone outside of management? Indeed, if as you say, the proposed settlements were ‘corrupt’ then are you not saying that Infy was corrupt in the first place? But none of that matters. For as long as people keep fanning those flames it is hard for management to get on with its job.

    9. Raghunandan says:

      The investigation was done by under the guidance of the same people who were accused of wrong doings. In any investigation scope of investigation and the people enquired including documents seen are important. A controlled investigation under the same people who were accused will give clean chit. To me that has no meaning. Only a full fledged independent investigation without the influence of the board and CEO will bring the truth.

      For your information, management is the trustee of public money as good governance principles say. Shareholders are the real owners and they have every right to question. If the management don’t want to answer they should not be there in the first place.

    10. Dennis, the comments from several Infosys alums here only confirm the living in the past I pointed in my comments. As someone who has helped a number of CIOs evaluate outsourcing options I can tell you the Infosys of the late 90s and early 2000s has long moved on. CMM Level 5 meant something – tangible productivity in error reduction, cost improvement etc. The new Infosys is Amazon which has delivered 50 price cuts in the last decade and impressive uptime, global network etc. One of the worst things to happen to Infosys was the glowing coverage in Tom Friedman’s book The World is Flat. The Bangalore campus became a spot to bring government leaders from around the world as a showcase of India’s software capabilities. All this went to Infosys’s head, even as performance on customer contracts was declining and labor teams and cost grew more and more. The alum want to resurrect the old Infy. It’s not coming back. Vishal is trying to make it a more IP centric company in a world where automation of repeated tasks is accelerating as I describe in Silicon Collar.

      1. says:

        No disagreements from me Vinnie…

      2. ClearTheFog says:

        Vinnie,

        Would request some objectivity so as to weigh in your comments correctly. In your experience how much outsourced IT work is on AI versus ‘old CMM 5’ based AD/AM work? When infosys has to grow by $300m net new revenue every quarter please enlighten which set of clients are spending on AI at this scale , and more importantly they would want to outsource this work ?

        With respect to your IP centric company comment, in more common parlance you mean a Product company? Does that need investment ? And what right minded engineer builds products in a services company as a side job , being paid what they are ?

        Easy to talk at 35000 ft, try joining the dots on the ground.

        All I am saying is that I don’t disagree that Indian IT service providers have to evolve, but please don’t oversimplify and hype AI as a silver bullet.

        1. KirkOut says:

          The need to touch on 2 pieces here:

          1>
          “In your experience how much outsourced IT work is on AI versus ‘old CMM 5’ based AD/AM work? When infosys has to grow by $300m net new revenue every quarter please enlighten which set of clients are spending on AI at this scale , and more importantly they would want to outsource this work ?”

          Is your implication here, that ‘old CMM 5 based AD/AM work’ credibly positioned to achieve the $300m target?
          I believe that has been the bone of whole point about turning the model around.

          The point is not AI per se.
          Point is, you need to move to creating value using model which is IP driven. AI is one tool, tomorrow there will be another.

          2>
          “And what right minded engineer builds products in a services company as a side job , being paid what they are ?”
          What gets to draw the conclusion that building products has been a side job?
          The way to see it:
          a. classic business model: sustain it (at least for now), tweak it to reflect realities of the time. (e.g. with automation)
          b. build new IP centric model in parallel: which brings non-linear growth, easier to scale etc.

          There is no side job here. Explicitly defined strategy.

          1. ClearTheFog says:

            1.
            The point is that you should do whatever the market needs. AI based work is fine , but that has only so much revenue potential, at this point in time.
            2.
            ‘IP centric model’. Again jargon which works well at 35000 ft. Define ‘IP’ in simple practical terms. What IP needs to be built ? What resources are dedicated to build that IP ? For services work that one does for customers, the IP rests with the customers as the customer is paying for the team’s time.
            Also the promised benefit for each tool is productivity or efficiency or new value. Every client wants to bank that additional benefit themselves (or atleast a large part thereof). That is the sad reality I am referring to.

          2. KirkOut says:

            For some reason, there is no ‘reply’ option possible to ClearTheFog’s comment. So punching it here:

            “1.
            The point is that you should do whatever the market needs. AI based work is fine , but that has only so much revenue potential, at this point in time.”
            Have you heard / read of Innovator’s Dilemma?
            When you simply chase ‘what the market needs’, you are on your way out.

            “2.
            ‘IP centric model’. Again jargon which works well at 35000 ft. Define ‘IP’ in simple practical terms. What IP needs to be built ? What resources are dedicated to build that IP ? For services work that one does for customers, the IP rests with the customers as the customer is paying for the team’s time.
            Also the promised benefit for each tool is productivity or efficiency or new value. Every client wants to bank that additional benefit themselves (or atleast a large part thereof). That is the sad reality I am referring to.”

            I still don’t understand, where the conclusion gets drawn that it was run as side job?

    11. InfyChallenger says:

      Vinnie Mirchandani – firstly, I am a fan of your books and you are awesome!

      Point no 1. Please do not rush to the conclusion that Infy alums are living in the past – we are the foremost thought leaders you can find and it is Reality 101 that the world has changed from commodity to digital. We don’t want old Infy as you say, what we want through is ‘clean infy’ ‘good governance infy’ and such first, and then ‘growth infy’ ‘thought leadership infy’. Our FIRST WORRY is that ethics is at a horrible low in this iconic company that once stood for ‘Driven by values’.

      Second point. Dr Sikka is not trying to build an IP-centric company. He is trying to TALK ABOUT IT. On the ground, nothing is happening that indicates that he is buying IP, building IP. Just because two companies called Panaya and Skava are bought, it doesnt mean it is becoming IP-centric. Sure he is trying to sell a lot of free IP in the name of prototyping IP but that is almost for zero dollars. If as you say he is indeed trying to build an IP centric company, we as alums, would be delighted. That is not the case. What is really happening is that Mr. Ravi K is cutting people left right center and it is improving utilization as no new business is coming. And that is being told as automation and productivity improvement. Dollar per employee is not increasing at all because of value work – it is just that people are being cut and so it is going up. Consulting business is really struggling. All high value services are stalling big time. All this empty rhetoric will get exposed very shortly as utilization is already nearing peak and overall business is absolutely dull.

      Third point. World is flat didn’t spoil Infy. Nandan left and he was followed by 2 incapable CEOs who wanted to be CEOs just because they were founders (aka founder’s disease!) and now Dr Sikka is finding it hard to turn it around. He will fail, not because he is incapable but because this is not his cup of chai.

      1. KirkOut says:

        “2 incapable CEOs who wanted to be CEOs just because they were founders”
        Aye to that. I was there.
        NRN was also around. He didn’t do anything, till it became way too serious.

        To your 2nd point, I like that this goes more insightful on real happenings on the ground.
        where is then current revenue coming from? Its best to get the facts.

        I find it hard to surmise that Vishal wasn’t building IP centric model, but only talking about it.
        I just find he has been impaired way too much to be able to execute on this direction. Challenging needs to happen to a healthy extent. Not to the level of impairment.

    12. InfyChallenger says:

      That is it. This blog can now close. Dr. Sikka is OUT as of 18th August 2017. And he will be permanently out after March 2018.

      1. says:

        Well – the naysayers got what they wanted in the end. Let’s see what happens next.

      2. KirkOut says:

        And that makes you happy – because Infy is now better off somehow?

    13. Infychallenger – my latest post: Infosys in a world of Amazon, Workday and Foxconn http://bit.ly/2wcJpkw

      You are delusional if you think Infosys can move from “commodity to digital”. Digital leaders are investing in their own products and business models to make them smarter and using contract manufacturers like Foxconn and design firms like Frog for that. They expect operational efficiencies in their infrastructure and back office like Amazon and Workday have shown possible. That is where Infosys can re-emerge but not with a labor intensive, 200K headcount model.

    14. InfyChallenger says:

      Vinnie – Boss you got it wrong. I didn’t say Infosys can move from “commodity to digital”. I said it is reality 101 that the world has moved. In fact I am saying the opposite in point 2 – that Sikka was not doing but only talking. And my post was more about what is needed first – first is clean governance and then everything after it.

      Read my post again and you will understand it better. Btw, I am an Infy alum – I am not currently with Infy and Infy is a sell to me.

      Edit your other post because I am not saying what you think I am saying.

    15. InfyChallenger I changed that sentence. But it hardly changes the opportunity for Infosys . You are fixated on a morality play. Clean governance while necessary, is not sufficient.

      The rest of my para says “Even though I write plenty about innovation, most of IT is stuck in 15, 20, 30 year old tech. Way too many companies define digital narrowly – social media or web commerce. The truly transformative companies are making their own products and services smarter, turning their business models upside down and looking at new automation as they rethink supply chains, and move to advanced manufacturing concepts. These innovators are not using Infosys (and in fairness most other outsourcers). But they do want Amazon, Workday and Foxconn type efficiency in their back offices.”

      I further add “In 1995, Michael Treacy and Fred Wiersema wrote their best seller “The discipline of market leaders”. They argued dominant companies picked one of 3 focuses – operational excellence, product leadership or customer intimacy. Can Infosys become a product leader without beaucoup, particularly industry and geography specific, IP? Not likely. Can it become customer intimate? Possibly, but not with a headcount of 200,000. Infosys could again become an operational efficiency leader like it was twenty years ago. But it would need to do that with a heavy focus on automation.”