What makes Infosys a poaching ground for rivals
BANGALORE: As change becomes the new normal at Infosys, with constant management churn spreading uncertainty among executives, India’s second-largest software services company is becoming a fertile poaching ground for rivals in the industry.
The Bangalore-based company, which has already seen five high-level exits after the return of former chairman NR Narayana Murthy in June, is seen by industry experts and headhunters as having a pool of highly-skilled executives who are now open to exploring opportunities outside. After about two years underperforming the industry, the company recalled retired cofounder Murthy, who has been making operational and management changes as he seeks to build a “desirable” Infosys.
“Organisations where transformation process is underway always represent an opportunity for picking talent and Infosys is not an exception,” said Ajit Isaac, managing director and chief executive of Ikya Human Capital Solutions, a Bangalore-based human resources and staffing firm. “There are many professionals in Infosys who have exit velocity in such a situation and are therefore available for alternative employment,” Isaac said.
The scramble for talent comes at a time when Indian outsourcing service providers are willing to offer lucrative salaries to hire executives who can help them win large technology contracts as demand improves in industry’s major markets, the US and Europe. Over the past few quarters, rivals such as Wipro and Cognizant have poached scores of mid-level, client-facing Infosys executives with direct access to clients.
Constant change makes Infosys a poaching ground for rival companies “The Infosys brand has attracted the best from the talent market over the years and now they have become seasoned professionals. Given the state of flux internally, they aren’t certain of what future it represents for them,” said a senior headhunter who asked not to be identified. “It is only natural that they would want to know what their options are.”
After Murthy’s return, Infosys has seen its sales head Basab Pradhan resign to join a startup, while its North America financial services head Sudhir Chaturvedi left in July to join NIIT Technologies. In August, Ashok Vemuri, Infosys head of North Americas and a frontrunner to succeed SD Shibulal as CEO, resigned to join rival iGate. Recently, two senior executives from the company’s business process outsourcing division headed for the exit.
The chairman’s office has become the new power centre at the company as Murthy implements a series of changes including centralising decision-making, cost-cutting at overseas locations and assigning additional responsibilities to senior executives. At the time of returning, Murthy had also insisted on bringing his son Rohan Murty along as his executive assistant, a decision that experts say, has unsettled many senior executives.
“Infosys has good talent and I would be keen on talking to them,” said Ganesh Ayyar, chief executive officer of Hewlett-Packard-owned Mphasis, which is looking to hire two executives for management roles.
However, despite recent changes, investors have been flocking to buy the Infosys stock, which gained nearly 24% since Murthy’s return on June 1. Equity analysts called it a short-term rally fuelled by “Murthy’s image” but could end if the company misses revenue expectations in the upcoming, second quarter.
Industry experts say that Infosys is now making an extra effort to talk to both clients as well as employees about the recent changes and restructuring to tame potential uncertainties.
“NRN is a sharp leader and obviously he would have done his analysis,” said Pradeep Mukherji, president and managing partner at outsourcing advisory firm Avasant. “He knows that there is no point in keeping people who are not aligned with the needs of the company as he perceives it. As long as Infosys can get their act together, there should not be any problems.”