LIVE AND EXCLUSIVE:INFOSYS TOP BRASS TALK TO b&e ON LIFE AFTER DEATH AND ON THE ROAD AHEAD. deputy editor virat bahri GIVES THE INSIDER ON THE STRATEGIC LESSONS FROM INFOSYS!
Kris prefers believing there’re many empty glasses that could have been filled up by Infosys, and that it hasn’t succeeded in doing so. Kris comes from a world, where Infosys – under Murthy – was used to comfortably growing at rates close to, and sometimes beyond, 100%. Even Nilekani sailed around the 50% figure for long – iconic growth in any context. Compare that to the fact that Kris ended last year with 29.5% growth. “In good times, high repeat business is a very good strategy; in bad times, bad!” says Kris on a Monday afternoon to us, “So should I architect a new sales strategy? We need a lot more hunters (who get newer businesses) than farmers (who maintain current businesses).”
The first quarter of FY 2010 hasn’t been too kind and has only supported Kris’s contention. Infosys’ revenues actually fell 2.9% quarter on quarter, in rupee terms. For the same quarter, as per Angel Broking, “Infosys’ IT Services Business was largely flat in US dollar terms on a sequential basis, while on a yoy basis, a fall of 2.8% was witnessed.” Further, onsite volumes declined 2.1% qoq (0.6% decline yoy) and offshore volumes slipped by 0.6% qoq (but grew by 9% yoy). The report mentions that in offshore volumes, this was the second consecutive quarter of sequential fall; and in onsite volumes, it was the third consecutive quarter of sequential decline.
To say that Infosys has been caught unprepared for this is to put it completely wrongly. In fact, the top management at Infosys has been preparing double time for the economic slowdown since the 15/9/2008 debacle, when Lehman collapsed, and when Bear Sterns collapsed much earlier in March. “I predicted the collapse of Bear Sterns six months before it actually occurred,” says Chief Financial Officer, S. Balakrishnan (Bala, for friends). And once Lehman collapsed, the world – as Kris tells – changed for Infosys.
The first quarter of FY 2010 hasn’t been too kind and has only supported Kris’s contention. Infosys’ revenues actually fell 2.9% quarter on quarter, in rupee terms. For the same quarter, as per Angel Broking, “Infosys’ IT Services Business was largely flat in US dollar terms on a sequential basis, while on a yoy basis, a fall of 2.8% was witnessed.” Further, onsite volumes declined 2.1% qoq (0.6% decline yoy) and offshore volumes slipped by 0.6% qoq (but grew by 9% yoy). The report mentions that in offshore volumes, this was the second consecutive quarter of sequential fall; and in onsite volumes, it was the third consecutive quarter of sequential decline.
To say that Infosys has been caught unprepared for this is to put it completely wrongly. In fact, the top management at Infosys has been preparing double time for the economic slowdown since the 15/9/2008 debacle, when Lehman collapsed, and when Bear Sterns collapsed much earlier in March. “I predicted the collapse of Bear Sterns six months before it actually occurred,” says Chief Financial Officer, S. Balakrishnan (Bala, for friends). And once Lehman collapsed, the world – as Kris tells – changed for Infosys.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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