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I will never sacrifice margin for growth, says Infosys CEO Salil S Parekh

I will never sacrifice margin for growth, says Infosys CEO Salil S Parekh

I will never sacrifice margin for growth, says Infosys CEO Salil S Parekh
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By Shereen Bhan  Mar 7, 2019 8:18:32 AM IST (Updated)

Salil S Parekh says Infosys is targetting a high margin business and will never sacrifice margin for growth.

Salil S Parekh, chief executive officer and managing director of Infosys, has three decades of global experience in the information technology services industry. Before joining Infosys, he was associated with Capgemini for 25 years and occupied the position of executive board member. Parekh had joined Capgemini in 2000 after it acquired the consulting division of Ernst and Young. Parekh has Master of Engineering degrees in Computer Science and Mechanical Engineering from Cornell University, besides a Bachelor’s degree in Aeronautical Engineering from the Indian Institute of Technology (IIT), Bombay. Parekh, who is the second non-founder full-time CEO of Infosys after Vishal Sikka, said the company is targetting a high margin business and will never sacrifice margin for growth. "My sense is that I have a good equation with the founders in terms of the role that I am playing," he tells CNBC-TV18. According to Parekh, Infosys is looking at small and midsize acquisitions and is generating $2 billion of cash each year.

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Edited excerpts:
Q: You have been in office for 14 months and you have stayed away from media. However, you are there during the quarterly results. So, why the decision to avoid the media so to speak?
A: It is not so much to avoid the media, it was more to focus on what we needed to do. Focus on our clients, employees and then obviously, meet with the media as and when things started to be appropriate.
Q: I am guessing then that you feel that this is an appropriate time to engage with us, to tell the story about what has happened in the last 14 months. You unveiled the three-year plan and FY19 was meant to be the year of stability as part of that plan. I would imagine stability also involves a lot of repair on account of what happened post-2017, how much of that have you managed to put in place?
A: What we have done is put the three-year plan in place as a view to take Infosys to a level where we have more and more client relevance. In doing that the first year was focused - as we share - on stability. Stability meant really making sure that our clients saw the changes we were making. Also, making sure employees saw all of the difference that we are putting in place. The focus on digital, skilling and the focus on engaging with clients on the transformation they were driving.
Q: Those are not necessarily new ideas or it is not necessarily an entirely new strategy. The Navigate Your Next strategy that you unveiled and some would say that this goes back to what SD Shibulal had tried to do with Infosys 3.0, focusing very sharply and squarely on your services capability, which under Vishal Sikka was moving more towards the product side. So what is new about Navigate Your Next?
A: I think for us, the big change is we are doing things that our clients are looking for a company like us to do. So in the first few months, I spent a lot of time with our clients.
Today, I have met with over 90 of our clients and a common message from our clients was Infosys is a company that they trust and it is someone that has delivered well for them over the years.
But now they are going through a huge change and the change is how do you apply data and analytics to their business, how do you apply cloud to their business and this is the change that we are putting in place. We are trying now to invest in those digital capabilities and make sure they are ready for our clients. That is the change.
It doesn’t have to be a dramatic, different, unique approach to succeed, but it does have to be an approach that makes sense for our clients and that is the main focus that we are trying to put back in place.
Q: I will get to investments in just a bit. But I want to focus on the word that you used, trust, and that is something that your clients are talking to you about. Post what happened during the Sikka period, there has been reputational damage and loss, what are the questions that clients now are asking you about your equation with Nandan Nilekani, about your equation with Narayana Murthy, about whether Nandan is inherently part of the three-year plan?
A: Clients necessarily not asked me about this, but I will still address the points maybe you are asking me.
Q: They are not asking you these questions?
A: Not so directly. Clients are asking that is Infosys ready to help them and partner them on their changed journey. They are expecting that as a business, we bring stability and re-engage in the trustful relationship that they have had with Infosys for years.
What are clients looking for? They have two big areas of focus. One, they want to put in the change in digital that is allowing them to grow and the second, they want to make sure that their cost on the technology infrastructure is as efficient as it can be and we are ready to help on both those dimensions.
I will come back to the points you made about Nandan and Murthy, but just to engage on this, one-third of our business today is in new areas of digital. That is now growing at 30 percent as that is what clients want. The remaining part of our business, which we call our core services, we are focusing things like artificial intelligence (AI), automation and making it more efficient and that is the reason if you look at us, comparing to our competitors, we are growing both on a digital – 30 percent a year – and on our core services as we are putting in the most efficient way of handling core services.
Q: You didn’t answer my question.
A: I will come back to that. Now, the question about Nandan and Murthy, I think what I have tried to do is build an equation relationship with all the founders. I have spent time with Murthy, with several of the founders in informal and social gatherings. I have obviously spent time with Nandan as he is the chairman of the board and the company. Also, in terms of our business and board meetings.
My sense is that I have a good equation with the founders in terms of the role that I am playing.
My role as a chief executive, I engage with Nandan and we practically speak every day or every other day on issues that relate to the strategy of the company or where we are driving the business.
He has given me, fortunately, a lot of space to run the business day-to-day and which is what my job is.
With Murthy and some of the other founders, it has been much more on a social level, making sure that if they need to access me for anything, I am available to them. However, they have been kind enough to engage purely on social activity and that is how we played it so far.
Q: You said that you speak with Nandan practically every day or every other day and of course not just large strategy issues, but I would imagine that it would involve decisions that the company is making with regards to specific clients and deals and so on and so forth as well.
A: He has kept himself focused more on the board level, on the strategic direction of the company and where we need to engage on that and on some areas where we look at. If I am looking to do some acquisitions, whether we are looking to do some joint ventures, I seek his advice and guidance. But he is being very careful to give me enough space to not involve himself on day-to-day deals.
Q: You said that this is not uppermost on the minds of clients when they speak to you, but what about investors, both domestic as well as foreign institutional investors (FII)s. Long-term FIIs would bet on Infosys, the likes of Oppenheimer, Aberdeen didn’t raise these concerns, what are the questions that investors are asking you about the new arrangements?
A: So far my sense is and even with clients to some extent and investors to a larger extent that they will observe, watch and make a conclusion. It is not so much about what we say, it is about what we do and if we do the right things over the next several years, they will then get a sense that this is working. So no one is asking me directly these sort of questions, but it is probably on their minds. But it is more they are looking at actions so far, we have been focused on the business, I spend all my time with clients and employees and Nandan and the board have really supported, they have endorsed this strategic direction we have taken and helped in making sure we are going in the right direction. The promoters have engaged in the way I described, in the social sphere so far and that is the sense I have, that they are observing the investors and making their decisions based on that, and as we keep doing more and more of this, they are going to feel more comfortable that this is the approach we are taking.
Q: Let me ask you about the point that you made on investments specifically and I link that back to the concerns that are with respect to your margins? Even in Q4, the assumption is that what part of your guidance will be on the lower end of the margin band between 22 percent and 24 percent. Where are you going to be deploying cash towards and what is the impact likely to be as far as margins are concerned going forward? You continue to have trouble keeping the attrition on the lower side, it has trended lower, but it is still fairly high if you compare it to Tata Consultancy Services (TCS) at 11 percent and you are almost 20 percent. You have tried to rejig compensation as well to try and ensure that that brings down attrition. So what is the investment strategy going to focus on?
A: First on margins, we are very clear. We are targeting a high margin business. We are never going to sacrifice margins for growth or for anything.
For fiscal 2019, we have a guidance 22-24 percent and we will fall well within the guidance.
So, we are very comfortable that is what we indicated at the end of the last quarter.
Where are the investments? There are investments in multiple areas we put in place. The first, we want to build more digital capability, one of the things that we saw was our clients are asking for that. So what does that mean? Today, we have a very strong position in the cloud space. We have a good relationship and equation with people like Microsoft Azure, Amazon AWS and Google Cloud. Those partnerships and the client change is bringing us a lot of growth in the market. Cloud also refers to Software-as-a-Service (SaaS) relationships and we have a strong play with various companies ServiceNow, Salesforce.com, so that is an investment in building capability in the digital area.
The second is, we wanted to make sure that we expand our sales footprint. From simply increasing the number of go-to-market individuals, we have in the market and we give a statistic in Q3. We are 5 percent higher than the previous year and that is something we have done all through the year and that will continue into Q4 as well.
The third, we want to make sure that some of the things we have done on compensation in the previous years we corrected it. We were doing compensation increases on different cycles and staggering them. We are now getting back to a system, which is consistent, annual and well understood by our people.
The fourth area is, we are building out on localisation. Localisation implies building new offices outside of India, building campuses, hiring locally and those are the investments. Those investments have nothing to do with the margin being sacrificed for growth. Those are investments we are making so that we can build an Infosys, which is more and more relevant for our clients in the future.
Q: I will pick up on some of those crucial issues you talked about. But let me just pick up on the issue of growth since you brought that up. We have just seen NASSCOM hold back its guidance saying that look, it doesn’t make any sense any longer as there are too many macroeconomics uncertainties, and you, on the other hand, have actually upped your guidance from 6-8 percent to almost 8.5-9 percent now. So as you look at the story today, what are your biggest concerns that could impact growth?
A: First of all, we are not giving any view of fiscal 2020. So fiscal 2019, we are comfortable with 8.5-9 on the constant currency and that is how Q4 was rolled out.
Now, stepping back and looking in the market, if you look at this digital area that I was describing, one that is growing 30 percent for us. We shared some data a while ago, the addressable market for that is about $160 billion and that whole market is growing at around 15 percent. So, that market today has shown no sign of slowing. The question is, do you have the capability and do you have the capacity? Capacity meaning people to do this and we found, even today, if we had a little bit more capacity, we could drive this even faster. But capacity is a constraint in the market somehow and we are working aggressively to expand that capacity.
In India, we recruited 40,000 people in the last 12 months. In the US, we have recruited 2,500 college graduates.
So, all of this is building capacity, but there is more demand. Overall demand for the digital is what I shared. For the rest of the core services, the demand is stable, its low single digits – that’s something we will see how the macro develops and obviously both of these things can be impacted by macro depending on where the macro goes. But as of now as we look at Q4, we have seen a fairly good robust set of demand and we are going with that.
Q: Let me ask you about capabilities as you talked about how demand in that sense is outstripping the kind of capabilities that you currently have. What is the strategy to be able to address that? You talked about hiring and beefing up your internal capabilities. But how much of the beefing up of capabilities are going to be driven inorganically through acquisitions? You have done two; one of about $75 million and the other was around that ballpark as well. What is the strategy now as far as acquisitions are concerned? also, I ask you this in the context of what we have seen happen with Panaya etc? Which have been questions that have been raised to the management on the write-down? So, when you take these proposals now to the board, what are they asking you that is different from previously?
A: On the acquisitions, the thinking is, we have laid out clearly our digital agenda and in addition to that, there are other areas of business which are also doing well, as an example engineering services. So, we will look at acquisitions which fall in these areas or some midsize ones, which are opportunistic that overlap some digital and some non-digital, and based on that, we will drive the acquisition agenda. So far the two, we have done are squarely in the digital space.
When we take this to the board, what has happened in the past has happened. What this board is supported is the strategy we have put forth for driving the company forward. So, as long as we bring an idea to the board, which falls within that strategy, some within digital, some overlapping, small to midsize, the board is open and receptive to it.
Q: Will it continue to be small and midsize. Is that how you are looking at the approach going forward?
A: Today, we are looking at small and midsize. We have not looked at anything else. But we have a very strong balance sheet, so nothing precludes us from doing something. Not that we are doing something massive, but we can certainly do midsize. Our balance sheet allows us to do something even larger. At this stage, we are not doing any of that. Our focus is primarily on small and midsize.
Q: Since you talked about looking at acquisitions in the digital space, let me ask you a different question. We are seeing a degree of consolidation back within the domestic IT space. Is that of any interest to you or do you believe that that doesn’t make sense given where you are headed for the future?
A: I think any comment on acquisition is always tricky to make. So, it is of interest to observe how the industry will develop. We have not been a participant in any of those at this stage.
Q: But could you be?
A: We never know in the future. Many of these companies are also shifting their business to more digital.
Q: Are you looking at anything in the domestic market?
A: We have no specific comments on the local markets or any acquisitions in general. The approach so far has been focused on the digital areas of our strategy and some mid-sized companies, which are both digital and non-digital.
Q: Are the mid-sized companies in India today looked attractive from what they have been able to do in terms of enhancing the digital capabilities that might make them potential candidates for you?
A: We have not seen anything so far. But it is not to preclude what can happen in the future but at this stage, we have not seen anything in that size.
Q: What is the outlook since so much of the strategy is focused on building momentum and acceleration, which is what you intended to do as you get closer to the third year of your strategy. So digital today about 30 percent odd of revenue, where do you see it?
A: We have not set a target externally for what the digital will be.
Q: Is there one internally?
A: There is one internally. The focus is we need to be driving growth ahead where the market is. If we think that the digital market is growing today at 15 percent and maybe in future at different rates, we should be able to find ways to expand our market share. To me today, it looks like an extremely attractive business to be in. It is something where clients have a lot of interest and we are building capabilities, we are expanding our capacity in that so we have some internal goals.
The idea obviously is to make sure that this becomes a larger part of our business and the more it becomes part of our business, the great are connect with the clients will be.
Q: Is that because of the $20 billion hangover from the past and you want to avoid that?
A: Not so much of that. Though that is something that is unusual when it was shared with the market. Some of these goals are very comparative discussions. For example, we have within the business identified areas which will become huge multi-billion dollar businesses. That is not something that I would talk outside because these are extremely competitive markets and we would rather focus on it and when it is realised anywhere people will see that.
Q: How soon you believe that these two engines of growth that you have identified, will start to deliver?
A: They are already growing extremely fast. But to become multibillion-dollar businesses, it will take time. So, that is even beyond that three-year internal plan that we put. As the three-year plan is just to get the company in a shape, which I think make sense. We are building a business for the next 10-20 years now. These multi-billion dollar businesses will sustain us for all of those periods as well.
Q: You have had a good track record since you came into the company as far as deal wins are concerned. What are you anticipating there especially given the fact that the competition is fairly intense? What is the outlook now as far as the deal pipeline is concerned?
A: The deal pipeline still is fairly strong. As you have seen, we have done extremely well in the first three quarters of the year over $4 billion in large deals compared to the previous year a huge increase. The pipeline today is still looking good. The reason again is the point we discussed earlier, clients have an incredible trust in Infosys. So, as long as we demonstrate to them that we are doing things which makes sense for them and the new capabilities we are building, they are happy to engage with Infosys and this is the greatest revelation in terms of how the growth is driving forward. The trust that the clients have on us, we want to make sure that we repay that and build more and more relevant things for our clients for the future.
Q: Speaking of the kind of competition that you are seeing in the market today, what concerns you and where you perhaps might be behind?
A: In terms of the competition, if you look at the global market of large companies like us, there are many western players that are actually shrinking today and so they have a lot of changes to make. Many of them are growing at low single digits and we on an organic basis with our guidance 8.50-9 that is incredible growth in this environment. There are a few players that are growing at mid-single digits. So from a comparative landscape point of view, we feel we are quite well positioned. However, we want to continue to expand our capability and depth, and the more we can do in the digital space, the better it is going to be. We have leadership positions in many areas. For example, in data and analytics, cloud and even in cybersecurity, but the more we can do in that, we can get more benefit or where the clients are going. I don’t see us lagging so much, but we do need to make sure that we articulate and show our clients and the market that we are good in these areas.
Q: I want to pick up on the point that you made about localisation because that again is very key to your strategy. You spoke about how you have hired about 2,500 of campus as part of the effort to build local teams. Give me a sense of how you see that impacting cost over the next few years and also the cost as far as sub-contracting the workforce. We have seen an increase in that, it is up 20 basis points QoQ, 100 basis points YoY, so are we seeing a structural shift as far as the cost is concerned?
A: Two separate points in there. First, on the campus recruiting outside specifically in the US, we will start to build what we call a full pyramid that starts from campus to all levels. If we are able to work in the new digital areas, these teams are available to demonstrate to our clients how the pricing works.
Our own internal model shows that this is something that is actually going to be accretive to our business. In terms of sub-contractors, here we come back to the capacity discussion, where we find today that there is not enough capacity that we can bring in quickly. So, our own internal operational approach, we are trying to improve to make sure that we can bring capacity quickly.
In the meanwhile, we want to make sure that we are working with our clients and meeting their needs, so we are increasing our sub-contractors usage. The good thing with the sub-contractors usage is that it allows you to quickly meet the demand and the bad thing is what you pointed out on the margin. But what we know is once we get our operational approach, more and more in control the sub-contractor usage over time will come down.
Q: What timeline are you looking at? By when do you feel that the reliance or the dependence will taper off?
A: We have not made any external commitment to what that timeline is. We have set some internal goals, which roll out over the next several quarters.
Q: There are a lot of internal goals that you have set out that you are not sharing with us.
A: I think a lot of these goals are things which we need to work on and make sure that we know what we are doing with it as I do not think it is our role really to share a lot of these metrics externally, especially in this competitive environment. The focus is to make sure that we are doing the right things inside that, over time, we become a company that is ready for the next 10-15 years of this IT business.
Q: I want to pick up on the point that you made about the kind of company that you want to be in the next 5-10 years and link that back to the point that you made about sitting on a fair amount of cash. Now, we have seen dividends, we have seen buybacks, we have seen some acquisitions, what is going to be the best use of cash as you fortify the company for the future?
A: We have a stated capital allocation policy and we have no plans of changing that. That is working well right now with dividends, buybacks and in terms of returning cash to shareholders. Fortunately, we are in a very good position generating over $2 billion of cash each year. We are looking in the market as we discussed earlier for the small strategic digital acquisitions and something which are more mid-size as they make sense. We have internal thresholds. The thresholds are first is a strategic directional fit, are they accretive to our earnings and then do they meet the test for our own return on equity vis-à-vis our cost of capital. Once we find that those parameters are met and then, there is a cultural fit and the management ability to integrate, those are things we will continue and look to acquire. Frankly, we are sitting in a really unique position as we do not have any pre-determined views on what we should or should not buy. Over time as we do, more and more of these, we think we can build a business, which is really resilient for the future.
Q: Since you talked about culture, let me ask you this, I think one of the concerns with the past, your immediate predecessor was the fact that culturally there were differences between how Infosys had traditionally had been run. For instance on this whole issue of holding out ambitious external targets, while you are reigning them back and keeping them much more internal. Murthy has always been about not overpromising and then under-delivering but do not guide too high and then under-deliver. That has always been his strategy. So culturally what has been the big shift that you have had to carry forward now as you try and bring stability in?
A: Fortunately as you said, Murthy and the founders have actually built that culture. To everyone at Infosys, the approach I am describing actually makes a lot of sense. A lot of it has come from as I shared discussions with clients, but also engaging with the leadership. The strategic direction was built with the leadership taking inputs from our clients. So, in many ways, it is something that Infosys has already very comfortable with. It is something which in my mind makes sense for a good business to do is to get on with the job of doing what the clients want and the results over time will show up.
Q: You have had a massive churn, especially as far as senior leadership is concerned. You have identified the verticals that you want to bet on and you have moved people in. How confident do you now feel about stemming the volatility especially when it comes to the senior leadership team?
A: I think over the past few years, there has been a lot of change in the leadership. What is good here is, we have such a huge bench of leaders that as we filled the roles and especially since I have been here, we have hardly missed a beat in terms of the market. We have continued with our large deals and we have continued with our growth. In fact, we have expanded our guidance and so on. So the bench that we have here is quite incredible and that is what I am really grateful for and we will keep developing that. My sense is, we have got to build a business that is much more client focused and over the years more stable. If we build that business and we then make sure that that is something that is looking after the aspirations of our employees and leaders, all of these other issues will calm down.
Q: What is it going to mean then in terms of more organisational changes, both in terms of not just people, but structure? Since you talk about wanting to improve on making this a much more client facing organisation, so outside of the efforts that you have put in on the sales team and beefing up the sales team, what more can we expect in terms of organisational changes?
A: The structure, we have made no change in fact. I think the structure, in my mind, there are many different structures which can work in our industry. We had a good structure. Any change in the structure usually takes six to nine months to settle in. So our approach has been we went with a structure, which is working really well and my sense is we will keep that structure along. We are also enhancing delivery capabilities and making sure that a lot of the leadership that is coming through are getting exposure to more and more activity in the newer areas of digital. We are recruiting a few people from the outside. For example, we have brought in some people to lead some of our service lines as we needed them and there is a lot of attraction we are finding,  good or bad. A lot of external people are looking to join us and that is a good sign for me as we needed, not extensively, we are able to pick one or two right individuals to enhance the team.
Q: So what would these one or two individuals be tasked with?
A: So far we have brought in someone to help us to run our consulting business. We are looking at people and mainly they have been on the sales side. We have brought in someone new to help us with the strategic partnerships with other companies. A few literally one or two of those examples already have come in.
Q: Let me come back to the more bread and butter stuff since we have been talking more about the strategy for the future. I asked you about key concerns given the fact that there are some macroeconomic uncertainties. But specifically, for instance, an important client like yours Apple and the way that that business has shown a decline, any specific client related issues where risk mitigation is in order of the day today?
A: For us first we have no specific client name or specific client engagement. Overall, we have no such views on risk mitigation. Today, again what we did at the end of Q3 was increase our guidance. So as a composite, the business is looking quite solid for FY19. We are now in the process of planning this month and before March 31, what we think FY20 will look like.
Q: Double-digit growth? Is that the internal target?
A: We have not even set an internal target yet. But by March 31, we will have an internal target and certainly, by April 11 we will share what we think the guidance will be. The view today is across various segments we see there are segments like energy and utility which are growing extremely well. If you saw last quarter, we were showing year-on-year growth of over 17 percent there. If you look at manufacturing, it was over 15 percent. There were some segments like life sciences which were less robust. Financial services were very strong at 9 percent year-on-year. So, the momentum today is within our business in reasonable shape. We think that the macro environment, we look at it carefully, but there are no specific client-related things that at this stage we are factoring in.
Q: In terms of being able to leverage on account of digital capabilities that you spoke of the large transformational deals, do you feel you have the agility the nimbleness and the capabilities to be able to go after those large transformational deals much more significantly?
A: Those are always hugely competitive deals, we have good capability, but we need to enhance also our capabilities, get more debt on clarity on consulting, really be deep on data analytics, be very well versed on the experience side -- all of those things we have, so we can play on the large transformations but my sense we need to keep deepening those capabilities to play them.
And in the large transformations, which are led more from an advertisement perspective and that is not the area that we are playing in. There are many that are led from a change in growth dynamics in the business. We are very much playing in that area and there are some that are led from just modernising the ecosystem and we are very strong in that area as well. Those are the areas that we have strength in and we can win in.
Q: So the three year plan that you already articulated in terms of acceleration now and that is where the three-year plan ends and hopefully you will put more levers into play post that but in terms of acceleration what is the key priority today?
A: We have been fortunate with the good momentum that we have already today. The main priority for me is making sure that we are building the organisation that is ready for the future, which is the client relevance point and the acceleration is going to come from. If all the elements of that organisation are in place, go first to the market. Then, operational rigour. Our delivery is exceptional already, but making sure it stays that way, bringing the new capacity, capability and the localisation.
Q: Have you become much more nimble than you were or do you believe there is some distance on that front because that was a concern earlier?
A: In terms of the company, my sense is most large organisations are less nimble than they chose to be. I would like us to be much more nimble than we are. Having said that, I find we are extremely agile when we look at large transformational opportunities. So, when we galvanise our teams to the specific opportunity that always comes about, but what that needs to be is institutionalised, which is for any opportunity without that galvanising, it should happen and we have work to do on that and we are working towards it.
Q: So how much of plan that you set in play for FY19, how much of that are you happy with the way it has been executed?
A: For FY19 the minute you increase guidance on growth and you hold your margin guidance, we are already in a very good place. So externally, I think the parameters are very strong. On an internal basis, I would still like to improve what we are doing operationally. So next year and the year after, some of those elements become strongest for us.
Q: Which would be specifically?
A: The point you made for example on sub-contracts, something which would be good if we get that addressed because that allows us to build our own capacity. The point we discussed on how do you do even more capacity because the demand is quite good, why should we leave any of that unmet.
Q: So last 14 months what has been the biggest challenge for you personally, coming in at a time when there was so much focus on what was going on inside Infosys trying to reach out and do a massive outreach externally to try and bring back some degree of stability? What has been the hardest part of steering the ship over the last 14 months?
A: I think the intensity has been the most different in that sense because my belief and fortunately Nandan and the board supported it fully was we needed to be much more with the clients and I have spent the bulk of my time in that endeavour, so that intensity when you are doing that almost every week on the road, I find that quite intense.
Q: How much time you actually spend in Bengaluru?
A: In office hardly any time as I was spending a lot of time on the road with our clients. But now, I am spending more in office as one needs to be on everything that is going on in business.
Q: As you look forward now and given the fact that your competition has been fairly aggressive as well. From a competitive perspective, what is the one big thing that you would like to change internally at Infosys, to deal with competition?
A: I think it is really the client relevance and intensity.
Q: But do you feel that this is particularly a weakness as far as Infosys is concerned as you have been talking about this theme and wanting to be much more client relevant and client specific, was this a significant weakness?
A: In fact, it has been the strength of Infosys since its founders started the company. But today, the market demand even a greater level of intensity. So it was more enhancing it as if you look back what Infosys has done for the past 20-30 years, it is always been about driving this client relevance. So as opposed to the weakness it was really enhancing what we are trying to do.
In terms of competitive dynamics, it is making sure we are obsessed, we are paranoid about seeing where the clients are going. As long as we reflect that back because what clients are doing is changing so dramatically, if we don’t reflect that back into the way we run our business we lose relevance and if we lose relevance, clients have many options at the end, they will stop working with us.
Q: I would imagine that the first year is always the honeymoon period. So you are given a lot of space and wriggle room as well. But as 14 months start to wind down and you look forward, do you feel that feet are firmly on the ground, that you have the requisite support to be able to bat for the strategy that you want to take forward?
A: Fortunately, we have had that at the very start of our strategy. I think feet on the ground in my view has always been – every quarter is a new quarter and you got to deliver every quarter. The more you take things for granted or be complacent, the more you are going to miss something that is going on in the market.
Clearly, there is a huge level of support and the board is supportive. Fortunately, within the teams, we have a dynamic team driving what we are doing in the market, what we are doing in delivery, what we are doing internally. But at the end to me every quarter that we go forward, the more we build credibility, the more we do the right things the more the feet will be on the ground.
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