NR Narayana Murthy was on the top of his game for the larger part of his career. He steered Infosys, the software services company he founded in 1981, with six others, to make it the poster boy of the Indian information technology (IT) industry.
For over three decades Infosys was under Murthy’s shadow, from 1993-2002 (since it got listed) as it’s CEO, later as its chairman, until stepped down from the board in 2014, once Vishal Sikka joined the company.
Between 1993 and 2002, Infosys’ revenue grew at a compound annual growth of 78%, from Rs 14.33 crore to Rs 2,604 crore. Its profits grew faster, at 83%, from Rs 3.51 crore to Rs 807.96.
For years, Murthy was the man to look up to, every time Infosys needed a father-figure. In 2013, he returned to the company as the chairman to fix things. In 2011, after SD Shibulal, one of the founders, became the CEO of the company, its margins and revenues suffered.
When Murthy was the CEO, some of old Infosys employees, remember, no one would dare to talk about reducing margins to please a client or get a contract. For the longest time, Infosys’ operating margins were over 30%. Under Shibulal, it was down to about 25%.
In 2013, he returned to “fix” the company, and return it back to its glory days. Murthy also got his son, Rohan, to become his executive assistant. However, in the weeks that followed, Rohan’s role was more than just assisting his father – he measured the individual productivity of employees, automated software development, put in programme junior employees and mentor them, retrain people, among others.
On June 14, 2014, as the annual general meeting, he said that his speech will be long as it was his last one as the chairman.
Murthy left, he was just a shareholder in Infosys, but a powerful one. Sikka ran the company, in less than two years, he came back – this time, not as the chairman, but as the founder, who cares for Infosys like his own child.
He raised concerns over Rs 17-crore severance package paid to Rajiv Bansal, Sikka’s salary compensation, and fall of corporate governance of the company.
To give it to Murthy, he still has some clout with the founding team – most of them backed him. A former Infosys employee who runs her own consulting firm, said, “It is not the same company as it was.”
A financial daily reported than the concern of corporate governance may lead to Securities and Exchange Board of India (Sebi) to investigate into the matter. No one raised questions, when Murthy had got his son into Infosys.
That is perhaps because Murthy is the most respectable entrepreneur of India, and his Infosys was best known for corporate governance under his reign. However, the Indian IT industry is also changing.
Murthy perhaps knows his limits. Recently, he told in an interview with Bloomberg, “Let me stop. I have made a point, paying such large sums of money is confusing. Now they have to sort it out.”
He wants to put an end to this battle between Infosys’ founders and its new management, but not before making his point.
For full coverage of the Infosys boardroom battle, click http://read.ht/BSlM
Leave a reply