You complete three years in office this month, a period that has coincided with the worst recession in present history. How would you evaluate your term so far?
I am reasonably satisfied. Is there a room for improvement? Yes. Initially, the focus was to weather the downturn?hold on to customers, employees, not having to fire anybody, making sure that the idea and brand of Infosys is sustained. We were able to do that, maintain profitability and invest in the business. The focus was on cost control. Now that growth is starting to come back, it?s probably more exciting than in the past 18-24 months.
Infosys is the biggest IT services brand in the country but TCS is the biggest firm. Ideally, the biggest brand should also be the biggest company. Does this bother you?
Yes and no. Yes, we would like to be seen as the biggest company. But our goal is to make sure we have more than industry average growth rates and better profitability. More important is to make sure that we have highly satisfied customers, employees and investors. What Infosys means to its stakeholders is very important. It stands for its predictable, sustainable, profitable, de-risked growth. We are creating an institution that should be there 100 years from now. For us leadership development is very important; sustaining revenue streams and passing on value systems to the next generation is important; making sure that society respects us is very important. One of the things is size. We have to look at acquisitions. We have not made many acquisitions. But we have scaled and grown fast.
So will you go in for big-ticket acquisitions for scale or stick to the stated goal of exploring smaller-sized buys?
I can?t say never. If there?s an opportunity, I must evaluate. But the likelihood of big acquisitions happening is very low. Smaller acquisitions are what we are focusing on proactively. We want acquisitions for strategic reasons. It has to fill gaps in our services footprint and accelerate growth in a particular geography. We are not doing it for people. In a year, we are adding 30,000 people. Recruiting people is not a challenge for us. Growing organically is not a challenge. Accelerating a strategic area is important.
What set of services look promising in a re-set world? Where would Infy?s next billion (in revenue) come from?
BPO, infrastructure management, consulting and engineering services are small today. Therefore, the potential for growth is high. If you look at our revenue streams ten years ago, 95% came from application development and maintenance. Today, it is 47%. So significant growth has happened because of other service lines. And ten years hence, the profile will look very different again. We have articulated it at a higher level?a third of our revenues must come from transformation kind of projects that involve consulting. A third must come from running business operations, which is BPO, infrastructure management and maintenance. Another third should come from solutions, new business models and the IP we own.
Is Infosys becoming too big to fail?
No. It should not fail because of the number of employees, customers and investors who all trust Infosys. There are lots of jobs at stake. Lots of investors have invested in the company. In that sense, it should not fail. But it is not too big to fail either. When it is too big to fail, it will have an impact on the economy. Will its absence be felt? Yes, because we have created something unique. It has given a lot of optimism to youngsters.
What is your sense of the Eurozone sovereign debt crisis and its downstream impact on the IT industry?
It is a cause for concern. It is a huge problem. If Lehman was a company, here you have countries that can default. Second is the uncertainty about the downstream impact?it could be a cascade of countries failing and taking down financial institutions with them that have an exposure to these countries. Then it will surely create a double dip. Now businesses are cautious, but we have not seen any slowdown yet. But you can sense that underneath uneasiness in clients.
Looking forward, what would Infosys? goal be? Do you dream of being the most profitable technology firm in the world, for instance?
We never said our goal will be to become the world?s largest company or the most profitable company. Our goal must be to create a globally respected corporation. From that, all other goals flow. We must be able to compete with any company on any given day. We do compete and we do win some. As we continue to grow, size will become important and significant. Today, from an employee base perspective, we are a significant company?one of the largest IT services firms in the world today. From a revenue perspective, we may not be that significant globally.