Infy Faces Fresh Round of Exits
Nothing appears to be going right for Infosys that once set standards of governance and growth. The company seems to have lost its mojo even as nimbler rivals have run ahead. ET takes a look at the turmoil within this erstwhile darling of Dalal Street and
Infosys could see a fresh exodus of senior executives in the coming weeks, with at least three senior vice presidents mulling to leave, a move some experts believe could test the stoicism of executive chairman NR Narayana Murthy. The Bangalore-based software exporter could see the largest number of senior-management exits in the company’s near 35-year history, said people aware of developments in the Bangalore-based company.
“The company is in a mess and the management does not know what to do,” said the head of an executive search firm, adding the restlessness among senior executives has become aggravated after one of the two presidents of the company, BG Srinivas resigned on Wednesday.
Executives who are considering to leave the company include the head of business unit that for now accounts for about 13% of company’s revenues, ET learns. Two other executives who are also in “advanced level talks” with head hunters include the head of one of the fastest-growing business verticals and a business head based out of India.
Infosys denies for now that any other executive has resigned. However, headhunters speaking on condition of anonymity insist it is matter of time before the senior executives start walking out from the company.
Infosys on its part says that the market reaction is “kneejerk” and a few executives leaving does not warrant any speeding up of CEO search process.
“At no stage was any guarantees given to anyone...people are feeling unsettled and if BG Srinivas (and others) have got an opportunity to take on a leadership position anywhere, I think they are free to take this opportunity,” an independent board member told ET. On Thursday, Srinivas was appointed the group managing director of Hong Kong-based PCCW. V Balakrishnan, former CFO of Infosys, described Srinivas as a “people’s man” and said he doubts if vertical heads will be comfortable reporting to a CEO who is brought in from outside the company. Balakrishnan, who thinks former CEO Nandan Nilekani should return, also said he is unsure about the ability of other senior executives to succeed Shibulal. “The present situation at Infosys is nothing short of crisis.” ET learns that Srinivas first expressed his unhappiness to his friends after Infosys made UB Pravin Rao as president with responsibility for delivery. A former colleague says Srinivas did sound out Shibulal, expressing his desire to leave the company. Although Srinivas too was made president, with the mandate to oversee market-facing teams, a colleague remembers saying him: “All this while I was made to believe I would be the sole president”.
However, by around midMarch, when Srinivas was told about the succession process — which was announced on April 11 under which Infosys mandated an external executive search firm and sought the help of another executive search specialist to help select from inside the company — he was completely taken aback, said two former colleagues. “When he came to know that the company would look beyond him and Pravin, BG then decided to move. That’s when he called headhunters,” a third executive familiar with the development told ET. Srinivas, who is based in London, is learnt to have shared his discomfort with Murthy on Tuesday evening and decided to put in his papers the next day. Srinivas, told ET in a text message “not to speculate” on the reasons behind his exit.
Headhunters speaking on condition of anonymity insist it is matter of time before the senior executives start walking out from the company