Will Infosys find redemption in Vishal Sikka

14th June 2014 | By Mouseworld Now Correspondent |

New-infosys-CEO-vishal-sikkaBangalore, June 13, 2014: Infosys, India’s second-largest IT services company, has for the first time named an outsider as its chief executive officer, ending month-long speculations. Infosys badly needs to boost sales of high-margin services like cloud computing and stem a staff exodus through this new appointment.

An ex-member of executive board at SAP AG, Vishal Sikka has the skills and much needed experience to bring in, what analysts expect, a strategy overhaul at Infosys.

Sikka’s appointment came at a time when Infosys, as some investors say, has failed to move up the value-chain because of its risk-averse management culture. Vishal Sikka joins Infosys as a CEO and MD at a time when the software services firm is no longer perceived as an industry bellwether. The company has been trudging along a low growth path relative to the growth reported by some of its peers.

According to Partha Iyengar, Country Manager – Research, Gartner India,
“The news of Dr. Sikka’s announcement is extremely important for Infosys since it ends the uncertainty that was the main enemy of Infosys. The new CEO will have to move very quickly to first calm the three key stakeholders, employees, customers and the investors, in that order. Infosys cannot afford any more resource departures especially at senior levels. He will next have to establish credibility with those stake-holders, again, in a fairly short period and then energize them in the medium to long term. The medium term strategy will have to be fairly close to the knitting of the IT Services industry – anything else will create a level of confusion and uncertainty again.

Dr. Sikka will also have to become a VISIBLE standard bearer for the Infosys brand, something that the Indian IT Services still need at the level of maturity they are at.”

Sikka will take over on August 1 from current CEO S.D. Shibulal. Sikka is considered to be an innovator in the global software industry. A computer scientist by training, Sikka played a key role in developing and marketing SAP’s flagship product, HANA, which helps firms analyse large amounts of data quickly.

Sikka brings to Infosys his expertise in newer technology areas, like cloud computing which allows clients to ditch bulky and costly servers for network-based software and storage in remote data centres.
His biggest challenge will be to fill the leadership vacuum created by the exodus of senior executives, many of whom were in charge of key business sectors and winning clients.

The annual rate of attrition at Infosys reached a record 18.7 percent, a fifth of its workforce of more than 160,000, at end-March. The leadership exodus was triggered shortly after Infosys brought Narayan Murthy from retirement as its executive chairman to help the company better compete.

Both Murthy and executive vice chairman Gopalakrishnan will also step down on Saturday.

Infosys shares rose 3.2 percent in early trade, but ended down 0.6.

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