"Losing the mindset of fear is what one needs to make progress"

Updated: Dec 23 2006, 05:30am hrs
Infosys founder NR Narayana Murthy has carved himself a niche as a business leader, visionary and an exemplar of corporate governance. Sebastian PT caught up with the man himself in Jaipur last week for a freewheeling discussion on a range of issues including Murthys personal beliefs, his disenchantment with the political class, the need for good politicians to be given a chance and his disinclination for painting on the large canvas of politics. On a different plane, he explains the magic that has made Infosys special and how he remains impressed by Chinas dedication, determination and discipline and its focus on its objectives. Excerpts from a conversation:

What, according to you, was the most defining moment for Infosys

Sometime in August 1981, we (Infosys founders) all sat down and said that we will seek respect and follow a value system. We are unique in the sense that each one of us has believed in making short-term sacrifices, being open-minded, transaction-oriented, believing in transparency and learning from people who are better than us. To me, the moment we we came to this agreement, it became the most defining moment for Infosys.

Do you wish you could have done something different or better

Infosys is an enlightened democracy and we do things after considerable discussion and debate. A good thing about democracy is that it avoids disaster, but it also means that it takes a little more time. Possibly, we could have been a little more ambitious in the first 10 years of Infosys.

It is said that Infosys was started in a different context and it may be hard to build another Infosys currently

If you want to do the same thing that we did, it would obviously appear difficult. But entrepreneurship is all about nurturing a new idea. If there is a set of people who think of an idea that is different and better than our idea, I think they will succeed even faster today. The economy is more open and the friction to business is much less than it was for us.

Born: August 20, 1946
Education: BE from the University of Mysore; M Tech from IIT Kanpur; also conferred honorary doctorates by universities in India and abroad
1981: Founded Infosys with six other software professionals & served as the CEO for 20 years; during this time took the company to great heights including the listing on NASDAQ in 1999.
March 2002: Hands over chief executive position to co-founder Nandan M Nilekani.
2002 to 2006: Executive Chairman of the Board and Chief Mentor;Currently: Chairman of the Board and Chief Mentor; sits on the boards of the Reserve Bank of India, Singapores DBS Bank, and Directors of the United Nations Foundation; member of the Prime Ministers Council on Trade and Industry; IT advisor to several Asian countries. Forbes magazine puts his wealth at $1.2 billion in 2006

Some awards and honours:
2005: Economist ranks Murthy 8th among the top 15 most admired global leaders; ranked 28th among the worlds most-respected business leaders by the Financial Times.
August 2004: TIME magazines Global Tech Influentials list has Murthy as one of the 10 leaders who are helping shape the future of technology.
2003: First recipient of the Indo-French Forum Medal; Voted World Entrepreneur of the Year - 2003 by Ernst and Young; One of two people named as Asias Businessmen of the Year for 2003 by Fortune magazine.
2001: TIME/CNN names him one of the 25 most influential global executives
1999: BusinessWeek names him one of their 9 Entrepreneurs of the Year. And was also featured in BusinessWeeks The Stars of Asia for three successive years - 98,99, 2000.

What else would you tell aspiring entrepreneurs

Entrepreneurship is all about having an idea whose value to the market can be expressed in a simple sentence, not a complex or a compound sentence. Then, you have to put together a team that brings complementary strengths from various fields like technology, finance and the like. Thirdly, you need an enduring value system because in the initial years of the entrepreneurship journey you will have to make a lot of sacrifices. Never before has India received so much global attention, especially in the developed world. This is the time for Indian entrepreneurs to consolidate on that and go for more projects.

What kind of a thrust should the government give

At one level, the government has to step back and create an environment where entrepreneurs can flourish. They have to reduce friction to business and create incentives to succeed. At another level, the government has to focus on constantly improving the quality of education. In other words, we need to unleash the power of entrepreneurship in the field of education.

Do you see that happening now

Not really. While we removed the licensing in the industrial sector in 1991, thanks to Prime Minister PV Narasimha Rao, we still have a lot of licensing requirements in education. That should go away.

Speaking of reforms, there is a school of thought that it has helped only the educated middle class and not the others

I agree that our industry can offer jobs only to the educated class. But it must be remembered that these people who have good disposable income go to restaurants, buy consumer goods, spend on tourism and the like. So, it has created employment facilities for non-skilled people as well. However, the government will also have to focus on low-tech manufacturing so that the vast majority of Indians who are semi-literate and illiterate can have jobs with reasonable disposable income. This is something that China has successfully demonstrated.

But the inequalities of income are getting wider ...

I believe, in any evolution or development process like this, there will always be some people who will get very rich. But as long as in their process of becoming very rich, a lot of people have improved the quality of their lives, that is all right. For example, in Infosys itself, we have created better wealth for about 15,000 to 20,000 people including my driver and my janitor. So we should not grudge a few people who lead the creation of this wealth that they are making some money.

You have been impressed by Chinas model of growth

I am impressed with Chinas dedication, determination and discipline. China is very focused on its objectives. It has created 140 million plus jobs in the last 11 years. China has improved the quality of life for a large number of people.

You have often said that the mind should defeat the mindset. Could you explain

As my friend and former CSIR director-general Raghunath Mashelkar keeps saying There is a constant battle within all of us between our mind which is the analytical engine, and the mindset which is the set of beliefs, assumptions and rules. It is the mindset that holds back any progress. If I want to take a step forward, my mindset says No, I am very comfortable here. Dont take the next step forward.

Let me give you a classical example of how you can make significant progress if you change your mindset. In the 70s and 80s, whenever I talked to my friends in the bureaucracy about introducing current account convertibility so that Indian companies could go abroad, become more successful and also earn more foreign exchange, they would say that we cant do that. At that time the mindset was one of fear that Indian companies cant succeed outside. But in 1991, the government took a bold decision and introduced current account convertibility. Today, we have forex reserves of $160 billion dollars as against $1.5 billion.

What do you think about productivity levels in the IT industry

We need to have higher productivity. Enhancing earnings per month, per day, per hour is what development is all about. If we can convince our customers that we can provide better value, they will start paying higher rates. So our challenge is to enhance our per capita unit of productivity by doing things that are more strategic to our customers, businesses; by doing things that bring more significant value to our customers by doing things that are more critical to them.

Besides Infosys, what else would you be liked to be remembered for

I personally dont believe in a second innings. When you have played a decent, joyful and an exhausting first innings, I believe that is sufficient. However, I would like to be remembered as a fair, honest and fearless person; a person who had high aspirations and worked hard for achieving them.

The Tatas and Birlas have built institutions like the Indian Institute of Science and BITS Pilani. Will you do the same

We have not started an institute like the Birlas and Tatas have done, because I believe that we have to improve the quality of our existing institutions. Infosys has worked towards strengthening some of these institutions by way of setting scholarships, by participating in improving the quality of teachers, etc. On a personal level, my wife and I have made a little contribution to educational institutions in India.

You seem to be distressed with the political class

It distresses me that though we have smart and bright people, their progress and desire to improve the country are being hampered by a vast majority of political class, who are below par. I believe that the good, courageous and well-meaning politicians should be encouraged by the citizens to take bold steps. Unless that is done, we cannot improve significantly.

Would you accept an offer of a public office

There are enough good people in politics like Manmohan Singh, Chidambaram, Vasundhara Raje and so on but they are in a minority. I dont know if somebody who has had no experience, somebody whose expertise was on a small canvas can easily go and paint on a large canvas. Politics of the country is a large canvas. There multiple divides rich and the poor, the educated and the uneducated, urban and rural. I am not sure whether I have the competence to succeed.

As Infosys chief mentor , what gives you the greatest satisfaction

My colleagues Nandan, Mohan, Shibu, Dinesh and Srinath have done a wonderful job. Not just in numbers, growth, profit, market capitalisation but also in maintaining the value system of the company. I am happy that they are making sure that this company retains its concern for the society, retains its focus on global competitiveness, quality and innovation.