Infosys, Wipro chase same co for first time

BANGALORE: India’s tech posterboys and cross-town rivals Infosys Technologies and Wipro have shown interest in buying out the US-based high-end analytics company MarketRx. The indicative valuation of MarketRx is seen between $150 million and $160 million (Rs 615-650 crore), sources said.

This is probably the first time the Bangalore-headquartered Infosys and Wipro are seen chasing the same company for a possible acquisition. MatrixRx’s $160-million valuation is five times its revenue, the sources added. It is believed that the promoter expectation is “slightly north of this valuation”.

It is learnt that four-five suitors have expressed interest in MarketRx after the company mandated William Blair & Company in the US and Avendus in India to explore options, which could lead to a possible sellout. “The promoters are exploring various options regarding the future and will take an appropriate decision. The process is on,” said a source familiar with the developments.

For software services biggies like Wipro and Infosys, the acquisition will give a headstart in the analytics segment of the knowledge process outsourcing (KPO) segment, as it takes considerable time to build one’s practice organically in this business. According to industry sources, it will take a minimum two years for any BPO to have a credible presence in the analytics space.

with people coming from diverse backgrounds such as mathematics, statistics and chartered accountancy.
Industry observers said analytics services bring in higher revenue per employee compared to conventional IT services. The rates of analytics services range between $30 and $60 per hour while some high-skilled statistical modeling processes attract up to $150 per hour.

Wipro has been focusing on inorganic growth, with its now famous string of pearls strategy. Infosys, on the other hand, is getting aggressive on the M&A front. A target like MarketRx provides the BPO arms of both Wipro and Infosys a platform to get into transformational business deals. Unconfirmed reports suggested that BPO major WNS could be also in the fray, but ET independently learns that the Gurgaon-based company is unlikely to join the race. Early this year, WNS acquired another analytics firm Marketics for $65 million, valuing it almost 10 times its annual revenue. The names of the other likely contenders could not be ascertained, but sources said so far private equity firms have not shown any interest. An email query to MarketRx did not elicit response, while Infosys and Wipro declined to comment on speculative reports. MarketRx was started in 2000. It has over 350 employees spread across the US, Europe and India. Its list of investors include the US-based venture fund Sequoia Capital. The India operations were started with the Gurgoan centre in 2003 and supports the US teams on collaborative projects besides servicing European and Asia-Pacific clients. MarketRx has more than 75 small and big pharma, biotechnology and medical devices companies as its clients. Third-party analytics is growing steadily in India with more players entering the space, but currently it being dominated by captive units of MNCs, especially the financial powerhouses. The likes of HSBC, Standard Chartered, Lehman Brothers, Deutsche Bank, Fidelity, Bank of America have their captive centres in India which do high-end analytics work.

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Narayana Murthy on India, IT and entrepreneurship

Narayana Murthy on India, IT and entrepreneurship August 29, 2007 N R Narayana Murthy, chief mentor and chairman of India's IT major Infosys Technologies, is one of the world's most admired entrepreneurs. Hence when he came to Mumbai to speak on entrpreneurship, one could not help attending the event. Here are a few gems from the IT czar's mind: Never before in the last 1,000 years did India receive so much attention as it has been receiving in the last 10 years. Never before in the last 50 years post independence, urban India has hogged as much limelight as it is doing now. However, in this regard, one must admit that the progress has not been that great in rural India. Indian villages have not gone as far as we had wanted them to be. My wife Sudha spends a lot of time in rural India (Infosys Foundation trustee) and she tells me that television has a tremendous influence in shaping rural Indian minds. It is because of the television that there is a much greater awareness of how things should be. Accountability of government has increased hugely, thanks to some responsible journalists and television anchors. This is the time when we must consolidate our gains and build a solid future. It's a daunting challenge no doubt which the entrepreneurs of this country must brave. Never before in the last 1,000 years did India receive so much attention as it has been receiving in the last 10 years, says N R Narayana Murthy.

'Leadership is about making people say: I can do anything for you' August 29, 2007 I was a staunch Leftist in my college days and also when I was working in France. However, my experiences convinced me that Mahatma Gandhi's theory on entrepreneurship and growth is the best. As Mahatma Gandhi said, 'We must become the change we want to see in the world.' What an entrepreneurship needs is a strong leader who has to prove his or her belief in sacrifice and hard work. This gesture will in turn enthuse other team members to make bigger sacrifices. A leader is an agent of change, and progress is made when that change is effected. Entrepreneurship is all about raising the aspirations of followers and enthusing people with a desire to reach for the stars. To today's entrepreneurs, I have to say: 'follow in the footsteps of Mahatma Gandhi. For, it is he who created a vision for independence in India and raised the aspirations of our people'. Leadership has to be absolute. Leadership is about making people say, 'I can do anything for you.' A leader has to raise the confidence of followers. He should make them understand that tough times are part of life and that they will come out better at the end of it. He has to sustain their hope, and their energy levels to handle the difficult days. The leader has to create an environment where each person feels secure enough to be able to disclose his or her mistakes, and resolves to improve. Leaders have to walk the talk and demonstrate their commitment to a value system. N R Narayana Murthy

Infosys tries to lower dependence on U.S. deals

Indian outsourcing giant Infosys Technologies is working to decrease its dependence on U.S. customers through faster growth in other markets, its chief executive said Wednesday.

"From a geography perspective, Europe seems to be positive, Australia is also positive," S. Gopalakrishnan said.

This is partly because Infosys is investing in those markets and also because these regions are catching up with the United States in outsourcing work.

"They have suddenly woken up to the fact they need to become more aggressive in leveraging this globalization phenomena," Gopalakrishnan said.

Gopalakrishnan added that although the business environment is currently more positive in Europe than the United States, U.S. clients are saying they will increase their offshoring if the U.S. economy slows down.

"We're not seeing any slowdown in terms of deals from the U.S. yet, but we have to wait and see," he said.

About 60 percent of the company's revenue comes from the United States, while Europe's contribution is 26 percent and growing rapidly. Nasdaq-listed Infosys would like to see 50 percent of its revenue coming from the United States, 30 percent from Europe and 20 percent from the rest of the world, although this is not a time-bound target.

"We are close to that, but not there yet. There are no target dates," Gopalakrishnan said.

Infosys, India's second-largest software services exporter, could raise billing rates by 3 to 4 percent for new contracts and 2 to 3 percent for existing contracts, Gopalakrishnan added.

Original Story

No subprime impact: Infosys

When the top Infosys management visits Mumbai, it is clear that they want to calm some investor nerves. With banking, finance and insurance as a key vertical, everyone wants to know whether the subprime meltdown in the US markets is going to hurt.

"Our exposure to subprime industry itself is less then 0.5 per cent, so its very less exposure and we are in touch with our clients. Clients are not telling that there is an issue or thing like that, so it does not look at this point of time to be very significant," said Kris Gopalakrishnan, CEO & MD, Infosys Technologies.

So no worries for Infosys then and certainly no noise of reducing how much it will earn, what investors like to call the guidance.

However, tough times are around and with a slowdown in the US imminent, it is clear that IT budgets will come down but that is also a time to hike its dollar rates.

Rupee appreciation

"As long as Rupee appreciation is gradual companies are learning to manage that. In fact, Rupee appreciation is of something new, from 2003 onwards Rupee has been appreciating at about two per cent every year. We have sustained margin inspite of growing cost and things like that. It was only in Q1 because appreciation was significant there was an impact," said Kris Gopalakrishnan.

Besides, it is looking to increase revenue share from non-dollar geographies like Europe that's where the recent acquisitions like that of Philips' BPO fir in.

Over a period of time Infosys wants to scale down US revenue share to 50 per cent from the current 60 per cent and increase Europian share to 30 per cent from the current 26 per cent. And rest of the geographies contributing almost 20 per cent including Latin America and China.

Infosys management says that historically the IT services companies have eventually benefited from the economic slowdowns in the western countries like the US.

But then their is an intermediary period before the outsourcing cycle kicks in all again, clearly the upcoming quarterly numbers of the company will be under a lot of pressure.

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China setback for Infosys

Infosys Technologies admitted on Wednesday that its China operations were growing more slowly than expected, with the company’s customers preferring to use its English-speaking outsourcing base in India.

The comments from India’s second-largest computer services company highlight how China is failing to fulfil its early promise for Indian outsourcers of becoming a rapidly growing alternative pool of talent.

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Infosys, Wipro lose their rank as the best IT employers

BANGALORE: Breaking the concept that Infosys and Wipro are the best employers in India is the Seventh Annual Dataquest-IDC report. The survey pushed industry bellwether, Infosys to eighth position from last year fourth position. India's third largest software company, Wipro does not figure among the top 20 IT employers.

According to the details of the survey 2,844 software, hardware and marketing professionals from 33 it companies employing 304,834 people in the top seven cities threw up the top 20 best IT employers based on a combination of employee satisfaction and HR scores.

The top five ranks went to TCS, HCL Info, iGate, RMSI and Synechron. The next five positions went to IBM, Capgemini, Infosys, Tavant technologies and Sun Microsystems. India's largest company, TCS, retained its numero UNO status in the best top 20 survey for the second year running.

The challenges of scaling up were countered through innovative HR practices. With almost 15 percent of its 90,000 employees based in foreign shores, TCS has replicated not just its programmes but also its ethos across multiple geographies, to achieve consistency in the workforce.

Commenting on the high points of the survey Pradeep Gupta, publisher of Cybermedia said , ''Multinational IT employers IBM Capgemini, Sun Microsystems and CSC have mastered the art of managing Indian employees to rank among the top 20 best IT employers in the country. Others, especially many India-based IT employers, will need to balance aggressive recruitment with the warmth and personal touch they used so effectively thus far, to retain people as they ramp up headcount."

Among the existing employees of Infosys, only 28.2 percent voted for it as "my dream company" in the 2007 Dataquest-IDC survey, compared to 36.6 percent last year. The employees of Infosys ranked their company very low on several parameters like growth opportunities, compensation and relevance of perks and benefits. Ironically, among the rest of the 2,844 employees of this industry-wide survey, those not working in Infosys it topped the votes as their dream company to work for.

The report also pointed out that the average attrition rate was down marginally to 14 percent from 15 percent last year. The top five reasons why it professionals changed their jobs were compensation, job posting abroad, growth opportunities, job location and technology area of work.

When asked what gave them satisfaction on the job, the employees voted career development opportunities, work life balance, organisational culture, job security and technology as the five top areas. Even though compensation was the top reason for job change, it ranked at number seven when asked what satisfied them the most.

Original Story

Rapid rupee appreciation a challenge, says Infosys CEO

BROAD FOOTPRINT: S. Gopalakrishnan (left), Chief Executive Officer and Managing Director, Infosys Technologies, with Amitabh Choudhary, Chief Executive Officer and Managing Director, Infosys BPO, addressing a press conference in Mumbai on Wednesday.

MUMBAI: The challenge for Infosys Technologies is dealing with a rapid appreciation of the Indian rupee against the U.S. dollar. Addressing the media, S. Gopalakrishnan, Chief Executive Officer (CEO) and Managing Director, said, “Actually, it is not a new phenomenon. From 2003, the rupee has been appreciating but in the first quarter of the current year, it appreciated by seven per cent.”

The company’s annual contracts come up for negotiation every January and according to Mr. Gopalakrishnan, “when the billing rates come up for renewal, we can ask for a rate hike. We expect new contracts to come in at 3-4 per cent higher rates and existing contracts to be renewed at 2-3 per cent higher rates. The environment is positive for higher rates.”

Geographical spread

On the impact of the rising rupee on the company’s business, Mr. Gopalakrishnan said, the seven per cent appreciation in the first quarter and nine per cent appreciation during the year takes time to absorb. “Typically, we use levers like utilisation, onsite-offshore ratios, services mix, customer group and regions, rate increases and internal efficiencies.”

Infosys earns around 60 per cent of revenues from the U.S. and it was looking at de-risking measures. “We have a broad services footprint and have a geographical spread. We have been investing proactively in Europe and the contribution to our revenues has gone up significantly from nine per cent of revenues in 1999 to 14 per cent in 2003-04 and to 26 per cent today. European companies have woken up to the need to leverage offshoring opportunities. In terms of geographical mix, going forward ideally, we would like 50 per cent from the U.S., 30 per cent from Europe and 20 per cent from the rest of the world.”

Wages

Wages in the Indian IT industry have, for the last decade, been going up 13-15 per cent annually. “Our model allows us to increase and maintain margins and we believe salaries will continue to rise as the economy is ‘hot’.” Attrition levels in the industry are at 17 per cent according to National Association of Software and Service Companies (Nasscom) and Infosys’ level is 13.7 per cent of which 1.7 per cent is lost in training.

Infosys BPO currently has 30 clients of which the top seven accounts for half the revenues. Amitabh Chaudhry, CEO and Managing Director, Infosys BPO, said the impact of the U.S. sub-prime crisis on revenues “this year is $1 million. The immediate impact is that volume and margins will come down.

China operations

Regarding the possible slowdown of the U.S. economy, Mr. Gopalakrishnan said, “The feedback till now is there is no sign but we are watching and clients will only increase off-shoring. Different sectors behave differently and currently, telecom, energy, retail, utilities and financial services are seeing growth and opportunities.”

Infosys has 700 employees in China with its BPO having 100 employees with offices in Shanghai and Guangzhou. “It is however, growing slower than we expected. Global customers have not taken to China as would have liked. India is still viewed as the ideal location for offshore outsourcing. We are pushing customers to look at China as an option.”

The Infosys CEO admitted that in the longer term, the biggest challenge for the industry was the talent pool crunch. Infosys is working with 330 engineering colleges and has a global education centre in Mysore where 10,000 students can train. There was an increasing sign of a reverse brain drain, he added.

“We are seeing more people coming back and we have programmes not just to attract Indians but foreign nationals here.”

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As mentor, GM Rao likens himself to Tata than Murthy

Bangalore, Aug. 29 (PTI): Having donned the mantle of a mentor of infrastructure major GMR, Chairman G M Rao today said he would like to position himself more in the mould of Tata group head Ratan Tata than Infosys' N R Narayana Murthy.

After announcing an organisational restructuring as part of which he became group chairman from chairman and managing director earlier, Rao said: "Narayan Murthy kind of mentoring could be good for IT sector but not for infrastructure sector.

"Whenever I spot a crisis, I will be the first one to jump into it," Rao told PTI after announcing the changes aimed at bringing in professional CEOs in different businesses of the group, which has a market capitalisation of about five billion dollars now.

"I will be focusing on institution building, strategy and planning for mega projects. But I am not taking a back seat," the 57-year-old industrialist said.

He said although professionals were being brought in the group to take care of day-to-day operations, he would continue to take responsibilities of key group decisions, besides mega projects such as the Delhi International Airport (DIAL).

Preferring himself to be on the lines of Ratan Tata, who is still actively involved in many of Tata Sons' activities, Rao said besides other roles, he would also take up the responsibility of mentoring senior leaders of the GMR Group and other key organisation building initiatives.

Stating that he did not like the GMR group to be judged merely on its assets, Rao said he would like to create an institution based on values.

In his new role, Rao will also take care of the group's various functions, including DIAL, Management Assurance Group, Corporate Relations and the GMR Varalakshmi Foundation -- the corporate social responsibility wing of the group.

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TCS best IT employer, Infosys the 8th

CHENNAI: Tata Consultancy Services retained its top position as the best IT employer in India, while software major Wipro figured nowhere among the Top 20 list, as per a survey by industry analysts.

While HCL Infosystems, iGATE, RMSI and Synechron occupied the next four slots after TCS, Infosys slipped four places to the eighth position, according to an annual survey conducted by Cybermedia’s flagship publication Dataquest in collaboration with IDC India. The seventh annual Dataquest-IDC survey was participated by 2,844 software, hardware and marketing professionals from 33 IT companies, totally employing 3.05 lakh people in seven cities.

The rating of employers was done on the basis of employee satisfaction and HR scores.

IBM was rated the sixth best employer, followed by Capgemini, Infosys, Tavant Technologies and Sun Microsystems.

According to the survey, TCS, with a large workforce based in foreign shores, followed innovative HR practices and maintained ethos across geographies to achieve consistency in workforce.

According to Pradeep Gupta, publisher of Cybermedia, multinational employers IBM, Capgemini, Sun Microsystems and CSC have mastered the art of managing Indian employees to rank among the Top 20 best IT employers in the country.

According to the survey, the average attrition rate was marginally down to 14 per cent from last year’s 15 per cent.

As far as job satisfaction was concerned, the employees voted career development and opportunities, work-life balance, organisational culture, job security and technology as the top five concerns.

Infosys remained the top ‘dream company’ as voted by one-tenth of the total participants, closely followed by TCS and IBM.

The number of women employees in the surveyed IT companies has slightly improved than last year. — PTI

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TCS, Wipro, Infosys increase investments for branding

Top Indian information technology companies, Tata Consultancy Services, Infosys and Wipro, are stepping up investments for branding initiatives, so they can be counted among the top five players on the global stage.

Currently, investments in branding initiatives are less than one per cent of their revenue budgets.

Sudin Apte, senior analyst and country head, Forrester Research, says that the importance being given to branding is encouraging as these firms were till now busy with such mundane matters as sales support and brochures, or simply on changing the logo and other cosmetic issues.

“In general, we’d say that budgets have doubled over the past two to three years. Infosys, Wipro, and TCS are 2-3 years ahead of the other India-based IT services companies in spending. But again a lot of it comprises marketing and sales support,” said Julie Schwartz, senior VP, research and thought leadership at ITSMA (IT Services Marketing Association, a membership community for marketing executives).

“There is a myopic view about marketing. We believe firms need basic, fundamental marketing like segmenting, tagging, articulating the message and differentiation, specialisation and a clear account strategy. Visibility and change in recall (or image) is the key. But that issue is more important for top firms. For the rest, basic marketing is what’s needed,” explains Apte.

Beaten hands down

TCS, the $4 billion IT major, launched its global branding campaign ‘Experience Certainty’ a few months ago. In the first phase it focused on the print media, spending close to $10 million.

Pheroz Vandrewala, executive VP and head of global corporate affairs at TCS, says, “We have seen that though we have proved our processes and delivery model, the top two companies (IBM and Accenture) beat us hands down in brand recall and visibility.”

The company will decide on further investments based on the result of the campaign so far. “We feel there is a scope for the third spot in terms of brand image and we clearly want TCS to be there,” Vandrewala says.

Playing the game

Mumbai-based Patni Computer Systems has also increased marketing spend by nearly 1.5 per cent.

Deepak Khosla, senior vice-president, Patni, who joined the company five years ago precisely to set the marketing and branding strategy in order, feels that the role of marketing is still not clearly defined.

“However, over a period of time I have seen that the marketing teams are becoming a crucial part of the business process. This is true for Patni as well. Of course, things like logo, relationship with analysts and others is also very important in the international market,” he said.

ITSMA senses that more experienced outsourcing companies, especially in India, now have greater aspirations.

Schwartz says, “It’s all about revenue growth, margin and profitability. When the outsourcers look over the fence and see the types of margins that Accenture, IBM Global Services, EDS, and CSC pull in, they wonder how they can play that game. They realise that they need to communicate different value propositions to their customer base.”

Standing out

Wipro launched its “Applied Innovation Campaign” this January. The company has increased spending on marketing and branding by 70 per cent over the past year.

“Earlier, we based our marketing on influences and guidance from advisory firms like McKinsey or Gartner, or we banked on past record. Now, branding has become important, as only the top five global IT companies will be recognised,’’ explains Jessie Paul, chief marketing officer, Wipro Technologies. “We want to showcase our uniqueness and be known as a global company.”

Infosys spent Rs 70 crore last year on its brand building exercise. The company underlines that it focuses on earning the respect of all its stakeholders.

Aditya Nath Jha, associate VP & head branding, Infosys Technologies, says, “The brand value as a percentage of market cap was 27.4 per cent for 2006-07. It is about doing the unusual thing, about staking a position in the market place, or in the minds of the employee, and then reinforcing that image. The branding exercise has been and will continue to be a priority for Infosys.”

Analysts hope that this is just the start and that companies will focus on differentiation rather than getting into the herd mindset.

Original Story

Companies down south on high alert

BANGALORE: Deadly blasts in the hi-tech hub of Hyderabad, the second attack in the city in three months, have raised concerns about investment in a region powering the national economy.

The bombs late on Saturday, blamed by the Andhra Pradesh state government on unidentified terror groups based in Bangladesh and Pakistan, left 42 dead and injured more than 50.

"If someone wants to try and threaten India's economy and investment-friendly matrix, they would try and target the southern cities where you have sunrise industries and young talent," said Harish Vellat, South Asia managing director at securities systems company HID Global.

"You will then have a situation where the foreign investment boom would be threatened," he said, warning that the south's growth made it more vulnerable to external terror groups and "empathetic local terrorist cells."

Most companies in the region have tightened security, especially after the failed British attacks put scrutiny on cities such as Bangalore as potential recruitment hubs and targets for terror groups.

"We are closely monitoring the situation and have further enhanced security in all our offices," said Hyderabad-based Satyam Computer Services.

Infotech Enterprises, another Hyderabad company which had briefly employed an aeronautical engineer alleged to have driven a flaming jeep into Glasgow airport on June 30, said its security systems were "always on alert."

"There can be no compromise on security," said KS Susindar, a spokesman for the outsourcing firm.

He said Infotech had already tightened security systems after it found that Glasgow bombing suspect Kafeel Ahmed, who died of burns in the attack, had been a former employee at its Bangalore offices.

Infosys Technologies said its employees in Hyderabad were working as usual on Monday while its Bangalore head office was shut because of Onam.

"We follow very strict security norms," said Infosys spokeswoman Bani Paintal, a comment echoed by her counterpart Radha Radhakrishnan at Wipro, the number three software firm.

Hyderabad, where 11 people died in a bomb attack on a mosque three months ago, has positioned itself as a rival to Bangalore in the 50-billion-dollar information-technology industry.

"South India and especially its software capitals are obviously being chosen as targets by terrorist groups," said N Reguraj, managing director of engineering company NTTF India.

"The region is being targeted because it's an upcoming economy," he added. "We don't have the kind of intelligence resources that a city like New Delhi has.

"It's time we became more aware of the need for reinforcing the intelligence networks in the region."

For the moment, companies in the region are relieved that hubs of economic activity such as IT campuses have been spared the attention of terror groups that targeted a packed street eatery and an amusement park in Hyderabad.

"You have to take precautions but one can overdo this," said Kiran Karnik, president of the National Association of Software and Service Companies. "These kind of attacks are worrisome but they are happening around the world.

"The purpose of such attacks is to win publicity," he added. "There's no guarantee where the next attack will take place."

Original Story

Madhavan on quizzing Narayana Murthy

Actor Madhavan is on a high. Not because of the success of his new film Arya but because of an interview he did on August 17 in Singapore.

This time, he was on the other side of the table interviewing none other than the mentor of Infosys Technologies, Narayana Murthy. The interview was conducted as a part of the 'Focus India Enclave' at the India-Singapore Exposition.

In this interview Madhavan speaks about the unforgettable experience.

It was reported that Narayana Murthy expressed his desire to be interviewed by you at the Focus India Enclave at the India-Singapore Exposition...

I think he didn't have much of a choice! (laughs). It was organised in Singapore and Narayana Murthy was asked whether he would like to give a speech or an interview. He said he preferred doing an interview by Madhavan!

Were you surprised to hear such a request from Narayana Murthy?

Totally. I don't know how I qualified to interview him in any way. But I was not going to lose such an opportunity to meet an idol of mine. It was a dream come true and I just grabbed the opportunity.

Why do you idolise him? Is it because of his entrepreneurial spirit?

There are very few companies like Infosys in India today, which can compete with any top company in the world, and can also boast of honesty. Like Tata for instance; they are the most honest and respected company in the world today. It is not blemished by any misconduct.

Similarly, Mr.Narayana Murthy too has an unblemished record. What he has achieved in the last fifteen years for himself, the country and his company is most exemplary. And to maintain humility after achieving so much is next to impossible.

Did you prepare yourself for the interview?

Oh yes, I prepared myself like I prepare for a movie, perhaps more than I prepare for a movie. I didn't want to sound like an idiot in front of him. I do keep in touch with the financial sector but for this interview, I did extra preparation.

What did you tell him when you met him at the function?

I told him I was a huge fan of his. In return, he said he was a follower of my movies. He also told me that his wife was a huge fan of mine. It was a mutual admiration society more from my side than his.

Did you ask him why he chose you to interview him?

No, I didn't. Whatever be the reason, I felt it was quite impudent of me to ask that and try to flatter myself. I just thanked him for choosing me.

What was your first question?

My first question was: Are you going to ask me questions in return? He replied, 'I am most certainly planning to.' Then, we started off on a very light note. He was very jovial and you can call it a heart to heart interview. By the end of it, we were on 'hi-fying' terms.

What kind of an interview was it? Was it personal or pertaining to the company and the IT sector?

The topic was the future of India with respect to the ASEAN countries in growth, in IT and the financial sector. So, I did not ask him any personal or unrelated questions. My questions were related to the economic growth and the growth of IT in India and the ASEAN countries.

I asked him when China is excelling in the manufacturing sector, India's growth is mainly in the service sector, so, is it possible to maintain the growth rate by concentrating on services alone? Will the bubble burst? He said, we have only scratched the surface and we have a long way to go.

Then I asked him, how long are we going to have only glorified BPOs in the country? We are not developing many software products in India. He said that would happen soon and we have to start making products that are of international quality.

How enriching was the experience for you?

For me, it was enthralling. You are hearing an icon speak with such clarity of thought. It was mind blowing.

Were you asking the questions to understand more about the financial sector, or as a person who follows the Indian economy closely?

Unlike what people think of actors, we also follow what is happening in the country minutely. My business depends on it. I don't think I let down my pedigree of people with my questions.

I remember Mr Narayana Murthy commenting that I only work as an actor but actually I am a financial expert disguised as an actor!

Did Narayana Murthy ask you any questions?

He wanted to know who my favourite heroine was. He asked that question in front of my wife! I told him very safely that my favourite heroine would always be the heroine of my first film, Alai Paayuthe. That is Shalini. Ajith and Shalini are very good friends of mine even today.

Yes, a very safe answer...

He can't get any answer smarter and safer than that!

Then, he asked me how I met my wife Sarita. It seems his wife, Sudha Murthy and my wife share a lot in common, both being Maharashtrians. Both are from the same village. In Kolhapur, Narayana Murthy and me are called the sons in law of Kolhapur! Sudha Murthy is a former Tata employee and my father was with the Tatas. I am also a Tata person myself.

It was a fun interview and we had some very good questions and answers later.

Didn't you ask any personal questions?

I did. I felt he and Sudha Murthy looked madly in love even now. I asked him, despite becoming one of the richest and one of the most successful men in the country, how he still maintains such a romantic relationship with his wife. His answer on romance, I dare not repeat now because I want to use it in one of my movies. I have never heard romance so technically described.

Now let me ask you about your recent release Arya. Arya is a typical commercial masala film, which many feel is not a Madhavan film, quite different from the kind of films you used to do earlier. Why do you act in such films?

All those people who write reviews of my films like Arya in English write that they don't expect these kinds of films from Madhavan! The fact is I don't care about what they say because I have given a movie that would satisfy the commercial market and the distributors. The film is a hit.

Tell me what is a typical Maddy movie? I feel it is a movie that makes money. You cannot hold a dagger at my throat and say that I make movies you like. There are other people also who like my movies.

Is it to reach out to people that you act in such films?

Of course, it is. There is a certain section of my audience who want to open their shirts and dance, who want to shout my dialogues, who want to throw money at the screen, who want to sing my tunes. I have to think of them also.

I can do a Kannathil Muthamittal, which will get a fantastic review on rediff, but those who come to the theatre and watch the film in a small town are different.

When Thampi came out, everybody gave a bad review except the Tamil press and when Rendu came, nobody had much to say about it. When Arya came, it was also described as an okay film. But all these films are super hits. When Anbe Sivam came, there were fantastic reviews but the film was a flop. I get more recognition and money when I do films like Thampi, Rendu and Arya.

If you walk with me in Madurai, you can see people who call me Arya! They tell me, 'What dialogue delivery, what style, what songs!' That's what they want. Hearing them is the biggest achievement.

An A centre guy won't even go to see a movie if he doesn't like the promo, whoever the actor is. Whereas the B. and C centre audiences are loyalists. They watch the films of their favourite heroes again and again. I haven't built that audience for a long time.

So, I have to indulge myself in a film, and do three films for my audience. Till now, it was in the reverse ratio.

When did you realise that you have to build B and C centre audience?

I realised this because of the nature of the A centre audience. For example, everybody claimed Nala Damayatnhi was a fantastic film but what happened to the film? Anbe Sivam is described as a fantastic film but it was a commercial failure.

So, it is like understanding the market and catering to it..?

Absolutely. Research is needed before launching any product whether it is Pepsi, Coke or a movie and ultimately, it has to be marketed well.

Original Story

Investors can ignore Infosys for a while

Rs 1,783 on Infosys, I haven�t seen that of level in a very long time. Rs 45 down 2.5%.  When people don�t like a sector they find various reasons to paste it so first it was the rupee now the rupee has recovered somewhat now they are saying it�s the BFSI. Its just sector which the market does not want to buy it could be a variety of reasons it could be the fact that the next 6-months next one and half year looks murky deep down people believe that the rupee will continue to appreciate against the dollar and there is no respite in the long term against that or it could simply be a realization that the last bull run was led by technology and this bull run does not belong to that sector and it�s a silly way to look at things at one levels saying what is two different bull runs got to do with the merits of the stocks but these things inevitably play out and I think a lot of traders might be saying technology had its time in the sun. Yes, last time it was nothing but tech this time around it�s been an underperformer and we don�t want to get into that sector because chances are given the currency that sector will not be the leader of this pack anymore. There could be technical bounce back from time to time but that�s not the sector which will create as much wealth or nearly as much wealth as it did last time around. It could be that as well and too many people on the street seem to be saying the best days from a stock performance perspective might be over for that sector.

Tough call for people who have come into markets 2000 onwards many analyst etc and they�ve seen Infosys being an iconic kind of stock, it was a poster boy and suddenly last one year its done nothing its lost money for investors and the way its going it could give you technical snap back at one point in second quarter etc but otherwise its just losing scene here.

You keep thinking about Hindustan Unileaver, before it started its downtrend 3-4 years back it was the hottest stock it was the ultimate blue chip and in just 4-years it completely kept on losing money. I just hope and at that point Hindustan Unileaver was the best managed stock everybody would say wow what management great this that and then suddenly it became a dog of a stock I don�t know whether this sector is going that way but this initial signs are not good every small pull back gets sold into. The institutional investors are slowly milking away some of their holdings and nobody in the domestic market wants to buy it so frankly when the first quarter results came out my thought was  it would hold in range between Rs 1850 to Rs 2100. its not even gone anywhere close to Rs 2,100 barring one or two days and keeps grinding down to that Rs 1800-1900 zone. Its not comforting the market or the screen is telling you something and you can ignore it for a while but you can�t ignore it for a very long time.

Original Story

Blogged with Flock

HCL outperforms rival Indian outsourcers

Indian IT outsourcing firm HCL Technologies has increased annual sales by 42 per cent, despite challenges including a skills shortage and depreciation of the US dollar.

The growth is 10 per cent above the Indian IT industry average of 32 per cent.

The value of the Indian outsourcing market will rise from $39bn (£19.6bn) this year to $100bn (£50bn) in 2011, said HCL Technologies European president Rajeev Sawhney.

‘Much of our focus will now be on developing total IT outsourcing deals, managing attrition and addressing key areas such as financial services, pharmaceuticals and telecoms,’ said Sawhney.

HCL predicts continued expansion following annual revenues of almost $1.4bn (£703m) and fourth-quarter sales of $395m (£198.5m).

The figures show HCL Technologies outperforming key rivals TCS and Wipro, which both increased annual profits 41 per cent. But it is still behind Infosys’ 44 per cent growth rate.

Europe is a major growth market for HCL, with revenues from European firms up 54 per cent in the past 12 months.

‘It is no longer a question of whether to outsource to India, but what will provide it with the best value,’ said Sawhney.

The company is also strong in the UK market. This year’s deals include BT, BAE Systems and Lastminute.com ­ it also signed a multimillion-pound, multi-year contract with legal firm CMS Cameron McKenna.

In the coming year the Indian firm’s focus will be on selective partnerships in key sectors such as aerospace and financial services, said Sawhney.  

Original Story

Infosys CEO Kris Gopalakrishnan Describes Exciting Times

Tiernan Ray (Barron's) submits: I chatted Monday afternoon with Kris Gopalakrishnan, who’s been chief executive of IT outsourcing firm Infosys (INFY) for barely two months. He was most passionate about a few broad themes in the changing technology landscape. “One of the biggest changes you will see is the rise of appliances, and appliance-to-person communications on the Internet,” he said.

He gave as an example the fact that consumers can now get real-time traffic updates from handheld devices talking with global positioning satellites that in turn talk to computers monitoring the roadways of the world. More and more people talking with more and more devices, which are all talking amongst themselves.

The soft-spoken Gopalakrishnan (bio is posted here) took over from the more well-known Nandan Nilekani. The New York Times’s Tom Friedman made Nilekani famous by ascribing to him the observation that outsourcing makes the modern world a “flat” world, in labor terms. Nilekani had taken over from N.R. Narayana Murthy, Infosys’s CEO for its first 20 years to 2002, but both of the latter two gentlemen still serve on the company’s board and show up to guide the company’s vision and culture.

All of which puts Gopalakrishnan in a unique position, as one of the few remaining founding employees in the executive suite, to try and build the management bench of a company growing by leaps and bounds with young Indian engineers fresh out of school.

Which is no mean feat when the company is growing in every possible direction. Infosys will Tuesday officially announce the opening of a facility in Monterey, Mexico to service Spanish-speaking clients in this hemisphere. And it has about 700 people working in facilities in China (Gopalakrishnan says the skills of Chinese software engineers is excellent, and improving dramatically these days).

At the same time, Gopalakrishnan expects U.S.-based employees will represent an increasing percentage of the company’s total headcount, because as deals with existing customers get bigger and more important, some of the work’s got to be done here. Which brings its own special dilemma: Does Infosys buy a firm here in the States, as its competitor Wipro (WIT) did last week with the acquisition of Infocrossing (IFOX), a firm that hosts clients’ computers in its data centers?

“Acquisitions can bring you clients,” as well as U.S.-based labor, Gopalakrishnan conceded. “But you are then in a financing business,” he observes, meaning, Infosys would be spending money on real-estate for data centers and for clients’ computers, in such a deal, and, “it’s not really clear we are going to be better at financing in that way than are our clients.”

The other option is to ship more Indian workers overseas to “near-shoring” positions in the States. While Infosys will hire some U.S. workers in coming years, Indian IT graduates are not only more plentiful, they also still study some of the exotic, aging technologies of the past that Infosys’s clients still require: things such as COBOL and CICS and other computer programs of the mainframe era.

“American engineers who know those technologies are retiring and it's not as much a part of the U.S. engineering curriculum,” which is caught up with technologies of the Internet. Infosys will run smack up against the limits on HB1 visas for foreign workers, which cap how many can be brought here. Amazingly, the company has no lobbyists on retainer in D.C., according to Gopalakrishnan.

Amidst all this, some of the challenges on a daily basis are prosaic: why hasn’t the company won more business in managing companies’ IT infrastructure remotely, from India? I asked. Because IBM (IBM) gets that business thanks to its years of so-called managed services, says Gopalakrishnan. “We need more references in that area to win more business,” he said. That, and continuing to refine Infosys’s rep as what is basically a big IT shop, but one that does its job better than Infosys’s clients.

Big banks have large IT staffs, but the implication Gopalakrishnan made was that Infosys is more adroit at seeing where programming is science, rather than a bespoke art, and turning those observations into codes inculcated into the company’s work ethic. Process, method, re-use, the gradual refining of software development is what Infosys is going after.

My overall impression is that with Infosys spreading its wings in many directions, the company has no limit to growth opportunities it can pursue both in India and in the developing world, and even here in the U.S. But it also means the challenges for the company become more diverse and complex, from increasing headcount thousands of miles from home, to dealing with higher attrition rates in China, to calculating just how much growth can be achieved internally versus through buying businesses, to cultivating the next group of executives who will take the helm after Gopalakrishnan. Exciting, modern times for a still-young company.

   

ACM, Infosys create $150,000 computing award

A new award that will honor mid-career computer scientists for outstanding innovations offers more than a pat on the back
-- it also comes with a prize of $150,000.

Award sponsors
the Association for Computing Machinery (ACM) and the Infosys
Foundation will give the annual award to a computing professional
around age 40, or a small group of computer scientists, who have
created "something really important," said Stuart Feldman, ACM's
president and vice president of engineering at Google. "It's intended
to [recognize] something really big."

The award, announced Monday, was Infosys's way of celebrating its 25th anniversary,
which happened in 2006. "That's a very admirable and remarkable thing,"
Feldman said. "Instead of deciding to put up an extra statue of
somebody or throw a humongous party, they decided that they would endow
an award to encourage and reward great computer science."

With
the award, Infosys wanted to inspire students worldwide to consider
careers in computer science, said S. Gopalakrishnan, the company's CEO.
"Our goal is to identify breakthroughs that have broad implications
well beyond the scope of the innovation itself and that reflect an
underlying scientific or engineering methodology that is remarkable for
its rigor or for its sheer audacity," he said in a statement.

The
ACM-Infosys Foundation Award has the second largest monetary prize of
ACM's awards. In fact, the Infosys donation was so large that ACM had
to increase the prize for its prestigious A.M. Turing Award for
lifetime achievements in computer science. ACM announced in July it
would increase the Turing prize amount from $100,000 to $250,000 with
Google joining Intel as a sponsor.

ACM
plans to announce the first winner of the Infosys award in early 2008.
ACM and Infosys have left the qualifications fairly broad -- any
mid-career people in any core computing field who've created an
outstanding innovation. Computer science will change in the coming
years, and the sponsors didn't want to leave out new branches of the
field, Feldman said.

Feldman
expects to have a backlog of nominees the first few years. "There may
be years when we don't give it, because there's nothing that quite
comes to the standard," he said. "But for the first few years, we don't
expect to have any problems."

ACM offers several other awards with prizes ranging from $5,000 to $35,000.

Original Story

Low-tech industry can create better jobs : Narayan Murthy

Mumbai, Aug 18: The chief mentor of IT major Infosys Technologies, Narayana Murthy today reiterated that low-tech manufacturing sector can create better employment opportunities in India and called for development of low-tech industry in the country.

Speaking at an interactive meet here, organised jointly by All India Association of Industries (AIAI) and Young Entrepreneur’s Society (YES), Mr Murthy said ''In a country like India where more and more job opportunities are required, there is an urgent need for developing more and more low-tech manufacturing units.'' ''IT industry is not the industry that can create enough jobs for all in the country. However, IT industry can create job opportunities for those who posses specialised education and skills.

On the other hand, majority in the country cannot afford to get such specialised education and skills facilities,'' Mr Murthy pointed out.

''For creating enough job opportunities in India, the low-tech industry needs to be developed,'' Mr Murthy asserted.

Original Story

Infosys Technologies Positioned in the Leaders Quadrant for North American Offshore Applications Services 2007 Magic Quadrant

Recognition follows a number of customer awards and acknowledgements this year

FREMONT, Calif.--(BUSINESS WIRE)--Infosys Technologies Limited (NASDAQ: INFY) today announced it has been positioned by Gartner, Inc., in the leaders quadrant in the “Magic Quadrant for North American Offshore Applications Services 2007” report¹. According to the research firm’s report, “leaders are vendors who are performing well today, have a clear vision of market direction, and are actively building competencies to sustain their leadership position in the market.”

In the last two years, Infosys’ key strategic priorities have included strengthening its global delivery model across Asia, Western and Central Europe and North America, and advancing its methodologies and processes for application services delivery.

“Global delivery model-based (GDM) application services form the core of our client relationships and our value proposition to help companies win in the flat world,” said S. Gopalakrishnan, chief executive officer and managing director, Infosys Technologies. “We think being placed in the Leaders Quadrant by Gartner is recognition of our capability to compete for and win in large-scale applications outsourcing, as well as our investment in new offerings and geographic growth.”

The Gartner report adds that, “Arguably, the supply side is pushing the advancement of globally delivered application services more than the demand side.” The report goes on to say, “Service providers also are being called on to move beyond low-level development functions and essentially provide world-class, domain-specific, leading-edge application competencies. The result is that some providers have bridged this gap and had significant growth, while other service providers have failed to take advantage of the new, demanding market conditions.”

In addition, the report highlights key trends that are affecting the market and service provider landscape:

• Market demand for offshore application services is at a unique point; instead of the "exception," most buyers assume (and require) that some degree of globally delivered services will be included in their use of externally provisioned application services for cost benefits. Almost without exception, their provider lists include an array of traditional and nontraditional (offshore) providers. In general, most buyers concentrate on the cost elements of providers' GDM and non-domestic labor pools; however, as soon as they're involved in the evaluation process, face far greater sophistication in providers' GDM sales, marketing and value propositions than they did one year ago.
• Providers that aren't on the "accelerated" curve to fully integrate and systematically invest in and advance their GDM are quickly losing ground. The disparity among application service providers' GDMs is evident in their vision and direction, development of new service lines and competencies, execution via processes and methodologies, domain expertise embedded in their go-to-market strategies, and concerted investments in building out a multicountry, globally dispersed labor pool -- which means in-country (on-site and offshore) as well as offshore and nearshore labor pools).

“Clients trust Infosys as a partner to build and support business applications that are most critical to their transformation or day-to-day operations,” said S.D. Shibulal, chief operating officer, Infosys Technologies. “We believe our position in the leader quadrant underscores our understanding of clients, as well as our uncompromising commitment to customer satisfaction. We feel this evaluation is the latest recognition in a series of achievements, including several awards that confirm our success in addressing the evolving expectations of clients.”

In 2007, the company received many awards and acknowledgements from customers representing such global industries as banking, retail, automotive and many others in its role as a trusted transformation partner: www.infosys.com/media/press_releases/royal-bank-scotland.asp, www.infosys.com/media/press_releases/partner-progress-awards.asp, www.infosys.com/media/press_releases/ips-supplier-2006.asp, www.infosys.com/media/press_releases/sainsburys-2006-IT-supplier.asp, www.infosys.com/media/press_releases/wachovia-it-vendor.asp.

About the Magic Quadrant

The Magic Quadrant is copyrighted August 6, 2007 by Gartner, Inc. and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner's analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the "Leaders" quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

Original Story

The 8 visions that changed the face of India - Narayana Murthy

India completes her 60th year as a free nation on August 15, 2007. According to the Hindu tradition, completion of 60 years is a landmark event in the life of any person and celebrates the wisdom, maturity, accomplishment and the readiness to enter vanaprasta asrama (a phase of life marked by renunciation of worldly responsibilities, and detachment from power, desire, and wealth). However, 60 years is a short span in the life of a nation, and barely marks the first baby steps of a toddler. Hence, any assessment of India has to be generous and optimistic.

We have made decent progress in several areas during the last 60 years. We have produced world-class scientists, engineers, journalists, soldiers, bureaucrats, politicians and doctors. We have built complex bridges and dams. We have sent satellites and rockets into space. We have increased the number of doctors ten-fold. We have increased life expectancy from 32 years to 65 years. We have built about 20 lakh km of new roads; we have multiplied our steel production by over 50 times and cement production by almost 20 times. We have increased our exports from a few million dollars at the time of Independence to more than $125 billion now.

There is an equally convincing set of data to show that we have a long way to go in certain other areas. A whopping 350 million are illiterate; 260 million people are still below the poverty line; 150 million people lack access to drinking water; 750 million people lack decent sanitation and 50 per cent of the children are below acceptable nutrition levels. And basic medicines are unavailable in 75 per cent villages.

Be that as it may, today, I want to focus on a few major achievements that have transformed the lives of our people in a way we never imagined would happen:

Green revolution
Perhaps, no other Indian initiative has enhanced the national confidence as the Green Revolution initiated by Dr Swaminathan. This revolution, which started in 1965, not only transformed India into a food-surplus economy from a food-deficit economy, but also triggered the expansion of the rural, non-farm economy. The lives of at least 400 to 500 million Indians have been uplifted due to this initiative. From being a perennial importer of grains, India became a net exporter of food grains ten years ago.

White revolution
Coming from a generation which experienced an acute shortage of milk, it is unimaginable that, today, we have become the largest producer of milk in the world. The credit goes to the extraordinary vision of Dr Varghese Kurien, continued ably by Amrita Patel. In a nation where children are malnourished, such abundance of milk has offered us the opportunity to fight malnutrition.

Economic reforms of 1991
The economic reforms of 1991 - initiated by the late Narasimha Rao, Dr Manmohan Singh, Shri P Chidambaram and Dr Montek Singh Ahluwalia - opened up the minds of Indian corporate leaders to the power of global markets, helped them accept competition at home and abroad, and raised the confidence of consumers. Our hard currency reserves have gone up from a mere US$ 1.5 billion in 1991 to over US$ 220 billion today. The reforms encouraged entrepreneurship, and gave confidence to businessmen and entrepreneurs to dream big, create jobs, enhance exports, acquire companies abroad and follow the finest principles of corporate governance.

Independent media and brave journalists
The success of a democracy depends upon certain important values of governance - fairness, transparency and accountability. The freeing of media, particularly the television medium, has laid the foundation for improving these values in our governments. The courage, enthusiasm and the zeal to seek truth of scores of idealistic journalists and editors like N Ram, Arun Shourie, Shekhar Gupta, Sucheta Dalal, Barkha Dutt and Rajdeep Sardesai, just to mention a few from the English press and TV, are what make us feel confident that the future of this country is safe.

Telecom revolution
No other technology has brought India, the urban and the rural, together as the 500-line EPABX designed and implemented by the Centre for Development of Telematics (CDOT) under the leadership of Sam Pitroda. This programme brought fresh confidence to the people as they could reach out, in a jiffy, to their loved ones, the officials, and the doctors, just to name a few. People no more feel that they live in isolation.

Space Technology
Prof Yash Pal's Satellite Instructional Television Experiment (SITE) blossomed into a full-scale television facility connecting millions of villages of India. The television medium has made our political masters realise that their actions and inactions will be seen and judged by every citizen - from the forgotten villages of Assam to the activist villages of Kerala. This technology has given voice to the opinions of a billion people - the rich and the poor, the educated and the uneducated, and the powerful and the disfranchised.

Atomic Energy
Dr Bhabha conceptualized the Indian nuclear program and initiated nuclear science research in India. His program has made possible successful utilization of nuclear energy in defence, power generation, medicine and allied areas. Our peaceful use of nuclear energy has raised India's prestige as a mature and responsible player in this field.

Software revolution
N Vittal's Software Technology Program, along with economic reforms of 1991, laid the foundation for this industry's spectacular progress. India's IT exports grew from a mere $150 million in 1991-92 to $31.4 billion in 2006-07, and is projected to reach $60 Billion by 2010.

The Information Technology (IT) industry is unique due to several reasons. It focused on exports; benchmarked with the best global companies; followed the finest principles of corporate governance; created the largest number of jobs in the organized sector; and demonstrated that Indians too could succeed in the most competitive global markets.

Conclusion
What do these eight programmes have in common? They were all led by visionaries. These visionaries accepted global benchmarks and settled for nothing less despite tremendous odds. In each of these initiatives the national government was a genuine catalyst supported by some extraordinary politicians and bureaucrats. These examples clearly show how the people and the government can work together to achieve what is thought impossible.

What do I expect from the India of 2067? I want an India where every child will have access to decent education, healthcare, nutrition and shelter. I want an India where every child belonging to every race, religion and caste is confident that there is a bright future for him/her if he/she is honest and hardworking. I want an India which receives respect from every global forum because we Indians will be peace-loving; we will be gracious hosts; we will be fair; we will be pluralistic and respect every faith; we will be trustworthy and our aspirations and accomplishments will be high.


(The author is Chairman of the Board, Infosys Technologies Limited.)

Original Story

Madhavan gears up to quiz Narayana Murthy

Mumbai, Aug 16 (IANS) Tamil superstar R. Madhavan has been on cloud nine ever since Infosys chief mentor N.R. Narayana Murthy expressed a desire to be interviewed by him. The much anticipated interaction will happen in Singapore on Aug 17.

This is how it happened: Murthy was asked to speak at the Singapore Expo on business relations between India and Southeast Asia and he made a counter suggestion - why do a monologue, why not an interface?

"I'd rather be interviewed by Mr. Madhavan?" Murthy suggested to the Expo authorities.

Madhavan, a big fan of Murthy, is walking on air.

"I've that e-mail which I'll keep till the end of time. I've always been a big fan of Mr. Narayana Murthy. He's certainly one of my idols. I still remember his interview with Bill Gates where he had said, 'The real power of money is the power to give it away'. I'll never forget that line," said Madhavan.

The actor is hoping his interface with Murthy will have its lively and informative moments.

"I don't want it to be cut and dried. The very fact that he asked for me puts a big responsibility on my shoulder. And I intend to take that responsibility very seriously."

Madhavan has just returned from Singapore from the premiere of his latest Tamil film "Aarya".

"But I don't mind going back so quickly. My wife Sarita is coming with me. She says she wouldn't miss this historic moment in my life for anything in the world."

Original Story

HC quashes case against Infosys Chief Narayana Murthy

The Karnataka High Court has quashed the case pertaining to 'dishonouring National Anthem' against Infosys Chief mentor Narayanamurthy.

Justice K Bhakthavatsala, allowing a petition by Mr Narayanamurthy, seeking quashing of the proceedings initiated against him by the Second Additional Chief Metropolitan Court, Bangalore, taking cognisance of a complaint filed by Kannda Rakshana Vakilara Vedike, quashed the case.

The Judge said he (Mr Narayana murthy) had not committed any violation of the Act and playing of instrumental version of the National Anthem was not offensive.

Earlier, the complainant alleged that the petitioner Naraynamurthy had committed a crime under Section 3 of the Prevention of Insult to National Honour Act.

The complainant alleged that Mr Narayanamurthy had prevented singing of the National Anthem and merely allowed the Anthem to be played on instruments during former President A P J Kalam's visit to Infosys Mysore campus on April 8.

In his petition, Mr Narayanamurthy contended that the magistrate had no jurisdiction in taking cognisance and issuing a summons.

Original Story

Nandan Nilekani to write a book

Infosys Technologies co-chairman Nandan Nilekani is working on a book "on weekends". The book, to be published by Penguin, will be out next year.

This, according to those who know him well, will pave the way for him to emerge as a "thought leader", both within and without Infosys.

Last month, Nilekani, 52, handed over the role of CEO and managing director to co-founder Kris Gopalakrishnan and announced a morphed role for himself within the firm, focusing on strategy and global customer contact. He will also be actively pursuing the public agenda that he has had for a long time.

The book means he has something to say. The public agenda indicates that this is likely to go well beyond issues that affect the information technology industry. Sridhar Mitta, industry veteran and currently head of e4e, rationalises the change: "You make money, achieve fame and then like to use it to some purpose. At that stage you slowly ease yourself out."

Avinash Vashistha, offshoring consultant and currently head of Tholons, who has known Nilekani for years, explains, "Chief executives, after they have made their pile in the west often become entrepreneurial investors like Lou Gerstner who joined Carlyle after quitting IBM. But, I cannot see Nilekani in such a role and, in any case, there are no private equity firms of such stature in India."

Not everybody sees Nilekani getting into an exit mode. Ashok Soota, head of MindTree [Get Quote] and another industry veteran, sees a carefully thought out strategy operating in Infosys. "The change of role is a smart move. This is not just my view but (Azim) Premji's too. He said this created discretionary time to focus on key areas like strategy and large customers. So, he is out there in front without having to spend time with CEO type work. The firm has not one but two CEOs who can multiplex. Kris (the new CEO) is also well chosen. If you take into account Narayana Murthy, who is always available, there are in fact three CEOs."

Soota debunks the theory that Infosys works as if it is on auto pilot. "It may look like that but there are always domain and people challenges.

Plus, there are these new challenges like rupee appreciation and global uncertainties. So there is lots to do in a hands-on kind of way.

While affirming his continuing role in Infosys, Nilekani readily lists his public agenda. "I have been at the forefront of the Brand India building activity. This is the third year I am chairing the CII Brand India committee. Now, are planning an event in New York called 'India at 60' in September."

It all began with what he did for the 'India Everywhere' promotion at Davos two years ago. This was followed up with a stepped up presence at the World Economic Forum in various events and activities, and again at Davos this year.

"We are promoting Brand India for a variety of reasons, to raise India's profile, showcase India's economic opportunities, showcase its democracy, demographics and diversity which make it unique, project our soft power, so to speak," he adds.

Nilekani's second area of public interest is urbanisation. "I have been involved with urbanisation ever since I was heading the Bangalore Agenda Task Force here (Bangalore). Then I have been involved with the Jawaharlal Nehru National Urban Renewal Mission and I am also on the prime minister's review committee for it."

Third, he is a member of the national knowledge commission under Sam Pitroda, which has been working on a variety of knowledge issues, policies for education, e-governance and access.

A peep into Nilekani's long-term agenda is available from V Ravichandar, who heads Feedback Consulting and is a long term friend and associate in the public affairs area. He recalls that despite being part of a fast growing organisation, Nilekani has found time for public issues and community initiatives.

Ravichandar says Nilekani is also a strategic thinker who can get an agenda together that recognises practical realities. "These skills of his have sharpened over the years. He is headed to become a thought leader, in India and globally."

Original Story

Technology has brought us greater freedom - Nandan Nilekani

Do you think technology (in an Indian context) has brought us greater freedom?

Yes, it has helped level the playing field for India in the global arena. In a way, it has transformed India by providing a new vision to the country and liberating its populace. I believe rural India’s need for knowledge empowerment can be addressed using technology. The telecom revolution has really ensured that people in every part of India are able to connect with each other and with the external world. Now, we have leapfrogged to the next stage where mobile phones and the Internet are revolutionising the Indian consumer and corporations.

Also, what technology has done for the Indian corporation is remarkable. Competing in the industry is no longer limited to a privileged few. Technology has brought forward a whole new set of entrepreneurs who are ensuring that India gets her right place in the world. From an employment perspective, it has raised the standard of living of the average middle-class Indian. The IT& ITES industry has enabled the middle-class Indian to go after bigger dreams. It has also indirectly created many more job opportunities.

Do you believe companies today can access and develop technology more easily than before?

Yes, the liberalisation process definitely made technology ubiquitous. The Indian IT-ITES sector (including the domestic and exports segments) is expected to exceed $47.8 billion in annual revenue in FY07, an increase of nearly 28% in the current fiscal.

Additionally, with the growth in Indian economy and favourable policies, leading MNCs are looking to India as an attractive market for their products and technologies, and are targeting the Indian consumer.

We have taken the lead in developing technology cheaper, faster and better. Therefore, it is an area that provides us with lots of opportunities.

Why do you think Indian companies still do not invest significantly in developing or acquiring technology?

I believe we are progressing on this front. Indian companies do not invest significantly because their propensity for risk is not high. Developing technology requires up front capital investments and a nurturing period before you can realise huge profits. The gestation period is longer. However, the growth is non-linear in the sense that once the technology succeeds , your margins are much higher.

Today’s customer is increasingly demanding and therefore the companies need innovative concepts to address the diverse requirements of a large customer base. We have seen
increased access to capital for developing technology in India through venture capitalists. We hope to see more and more Indian companies adopting technology to compete in the flat world.

If you had to pick one technology (say mobile phones or the Internet) then which one, in your mind, has brought Indians more freedom?

Both have an important role to play in empowering the average Indian.

The Internet has opened the world to India and brought in greater awareness and the accompanying benefits of globalisation . Today, India has over 70 million
Internet users, of which nearly 2 million have broadband connections. With Indians buying over a million computers every year and computer education now an essential part of primary and secondary school curricula, young Indians are becoming intimately familiar with the medium and the associated technologies.The growth of the Internet has opened up new businesses like online travel booking and e-banking . The Internet is also actively fuelling the government’s e-governance initiatives such as online filing of tax returns.

The telecom boom we are experiencing in India today is opening up new opportunities for Indians. About 5 million new telephone connections are added in India every month. With over 130 million users, mobile phones are bridging the communication divide between urban and rural India by connecting people across the country.

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Infosys, TCS most reputed corporate houses in India

New Delhi, Aug 13: IT majors Infosys and Tata Consultancy Services (TCS) have emerged as the most reputed corporates in India while Tata Motors, Tata Steel and Hindustan Unilever have tied for the second place, says a corporate reputation index study.

The largest car maker in the country Maruti Udyog has got the third highest number of votes on the index, says the global consultancy firm TNS` latest Corporate Reputation Index.

The research firm said India`s progress is led by IT sector followed by FMCG and Petroleum.

"Corporate reputation is assuming increasing importance in today`s business, economic and social environment. As corporate behaviour is increasingly under scrutiny and corporate valuations go beyond financial performance parameters, it is considered to be a measure of confidence in the organisation and goes much beyond market capitalisation and brand equity," TNS said in a statement.

The corporate reputation index represents stakeholder expectations and experiences with the company and its services, processes, management and systems.

The study reflects views of financial community and senior and middle business managers in the industry. It also includes expectations of opinion leaders which comprise of senior bureaucrats, academicians and media personalities.

A total of 70 leading companies across various sectors were selected for the study conducted in the last quarter of previous fiscal.

While all top five companies figure in lead rankings across all stakeholder groups, the leaders in the respective stakeholder segments include some more corporate houses.

Just do it: V Balakrishnan, CFO of Infosys

In this day and age of high street finance, perhaps no one has a more challenging job than the chief financial officer (CFO) of a modern corporation. Investors and analysts today constantly monitor every statement made by the CFO, who not only manages finances, but also shares the primary burden of creating wealth for shareholders. This week, ET Investor's Guide is introducing a new column 'CFO Speak', wherein we will chat with a CFO about his/her organisation's current plans and future prospects. We kick off the column with an interview with V Balakrishnan, CFO of Infosys.

Thus far, Infosys has been growing organically. Given the thrust shown by its peers in terms of acquisitions, what are Infy's plans for inorganic growth?

We are very selective on acquisitions. We are looking for companies which can fill in some of the gaps in our business model; companies which can increase our access to a particular geography like our Australian acquisition three years ago. We are also looking at companies which give us growth in new verticals like healthcare, transportation and energy utilities. Other targets for acquisition will be companies, which have an intellectual property (IP) around which we can build services. We are looking at companies which will enhance our profile and not just the topline. Recently, we concluded the acquisition of the BPO facilities of Philips. We are keen on inorganic growth, but on a selective basis, without compromising our profitability.

Tell us more about the kind of gaps you face in your current business model?

Geographical reach is one aspect. Presence in European countries with faster growth is necessary. Probably, we can carry out an acquisition in Germany or France. Another region of interest will be Japan. The country is changing. Perhaps, we may look for a small acquisition there. If you look at verticals, energy and healthcare are showing rapid growth. Even in services, we look forward to the consultancy space and enhance value to clients by leveraging our global delivery model. Basically, it will be targeted at acquisitions.

What are the synergies for Infosys in the Philips deal?

We have taken over three Philips centres in the BPO space located in Poland, Thailand and Chennai. The acquisition strengthens deliverables of Infosys in finance and accounting verticals (F&A). F&A is the fastest growing segment in BPO services. Further, it will enhance our global network, since Philips has a sizeable presence in Poland. It also gives us a presence in services in Thailand, where currently, we provide Finacle. Thirdly, access to the 1,400 F&A professionals of Philips places us among the top five global F&A players.

It is difficult to get the skill sets in this space and this acquisition helps Infosys to get exactly that. Apart from this, it enhances our ties with Philips. Currently, it is our small client. The acquisition will help us mine these ties more by selling other services to make it one of our top 10 or top 15 clients. So, it's a great acquisition; small but great…

We believe that the main objective behind the Philips deal was to get entry into the BPO space in Thailand, given the attraction of a less volatile job market. How dynamic do you think is the Thai market?

You cannot compare any market with India. No market has the scale and depth as that of India. No country can match the quality of the talent pool we have. But when we work globally, we have to build global pitches and front ends. Create the front ends globally and leverage the offshore… that's what we are trying to do. This acquisition enables us to have a presence in Poland and Thailand.

What is the structure of risk-based contracts which you have signed recently?

There are some contracts where the clients want to attach some portion of the billing to the quality of output. The client will pay you only if he sees benefits; it will hurt you if he fails to see any. This is basically output-based pricing. But it's not a trend; it's happening with very few contracts.

Has the appreciating rupee changed the way contracts are structured?

Not really. At the end of the day, the cost to the company is what matters to the client. I don't think they will change the pricing because the rupee has appreciated.

Currency is something which we have to manage effectively, and not the client. You can increase pricing only by showing some kind of value proposition. Focus on improving the revenue productivity by going up the value chain. Value is added by increasing the component of consultancy and solutions in the deliverables.

What are the hedging strategies in place?

The currency market is too volatile to have a long-term view. We take a short-term view. We have hedged our revenue for the next two quarters. We undertake both options as well as forwards. In a volatile market, options give a lot of leeway to protect your downside. We mark-to-market all our positions in both forwards and options.Despite a strong desire to be in the consultancy gamut, your presence there is minuscule as of now.

You have to see our consultancy operations in totality. We have 220 employees at Infosys Consulting in the US. We also have many consultants at Infosys. If you add them, you will arrive at a sizeable number. Yes, in the front-end consultancy, we are making losses, as we are still in the nascent stage. In the steady state, it can comprise 7-8% of our margins.

Infosys has announced plans to focus on the local IT market. Is it a change in the mindset or a strategic initiative?

We have been serving the Indian market, though not on a big scale. We never said no to the local market, but opportunities were bigger globally. Now, the domestic economy is showing a high growth rate. As a part of their global strategies, Indian companies are increasing their IT spending to maintain their competitive advantage. The country is slowly investing more and more in IT. And, we think, we should take advantage of this growing market.There is talk of shrinking margins of Indian IT companies, given the fierce competition and changing face of deliverables.

Will we witness an era of lower margins for Infosys as well?

For us, margins are an aspiration. We have and want to have the best margins in the industry. It's a relative statement. I don't know what number or range it will be, but it is going to be the best in the industry. We aim for it and we also focus on growth. There is a huge market waiting to be addressed and one has to focus on the right part of the market. Our focus is on value-based contracts.
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