Infosys to tap start-ups in bid to regain lost mojo: CEO Vishal Sikka

Written by Darlington Jose Hector | Darlington Jose Hector | Bangalore | Updated: Aug 2 2014, 13:25pm hrs
Infosys-SikkaCEO Vishal Sikka's move to help start-ups signals the arrival of a new innovative spirit within the $8-billion Infosys.
Infosys new CEO and technology visionary Vishal Sikka on Friday said his primary responsibility was to restore confidence within the company by driving innovation and intellectual property-led growth. As part of this, Infosys will begin a new journey joining hands with start-ups and new-age entrepreneurs by putting to use the $100-million corpus that it has put together specifically for this purpose. Sikka, however, added that he has no plans to convert Infosys into a software products firm but instead retain its high margins as a software services player.

The move to help start-ups is very significant and signals the arrival of a new innovative spirit within the $8-billion IT services behemoth, which has thus far been hesitant to spend its considerable resources on such potentially risky pursuits. Sikka said there will be additional focus on non-linear growth that would come from use of IP and software as a service model. But that wont make us a products firm, he said.

Talking to FE on the sidelines of a luncheon meeting here on Friday, Sikka said he would want to immediately delve into the $100-million corpus and help drive the highest class of innovation at Infosys. We would like to help start-ups achieve scale quickly. And we are not just stopping with India. We will be happy to help any interesting start-up around the world, he told FE. Infosys has not dipped into this corpus yet. Hope we can start soon, he said.

Infosys chief financial officer Rajiv Bansal was at hand to chip in. We dont want technology innovation to be limited by geographical boundaries and hence this will be a global outreach programme. Infosys may pump in equity into some of these start-ups and in some other cases we may want to be a research associate, he said. The idea is not just to make money out of investing in these projects. Equally important for us would be the learning. There is a lot to learn from young entrepreneurs around the world.

The IT major in April last year had announced this $100-million fund to invest in products and platforms. IT services engineers across the globe have been clamouring for such exciting opportunities to work with start-ups.

Often, they leave large IT firms in search of these start-ups, many of which are into cutting edge innovation and research. We want our engineers to have the same innovative bent of mind. A day should come soon at Infosys when every employee, irrespective of his function or role, is able to think of innovative ideas to help improve himself and his team. This is the culture we want to build,

Sikka told a media gathering on his very first day as the head of Infosys.

At the end of last fiscal, the company's contribution from the products, platforms and solutions business stood at 5.2%. Sikka is now looking to increase this pie. I'm not saying that Infosys will turn into a software products player. We would continue to be an IT services firm but would definitely accelerate on the products front, Sikka said. Intellectual property work will be key. We want to bring in the efficiency of IP-related work into the services culture here at Infosys.

Sikka said it was important for Infosys to regain its confidence. Glancing at COO Pravin Rao, Sikka said, I am told by the senior management that once upon a time there was a feeling within Infosys that anything was possible. I want to help Infosys return to those days and become one of the biggest and most respected IT companies in the world. And for that we need to build deep domain knowledge while retaining our general strengths.

COO Pravin Rao said one of the key challenges was to win back the large deals. Infosys is looking to recruit in large numbers graduates from the best of management schools to beef up its sales engine, which was its biggest strength once upon a time, he said.

Responding to a query from FE, Sikka said that he was not concerned about the widening revenue gap with industry leader Tata Consultancy Services. TCS is a great company but we don't have to compare ourselves to it. We will continue to focus on inorganic growth prospects. We won't be shy about new acquisitions, added Sikka.