Infosys on a knife-edge: Analyst

Sikka needs to try change the mindset of people at the firm, says HfS CEO Phil Fersht

Global information technology (IT) sector analyst Phil Fersht has said Infosys is on a knife-edge, even as some its founders have raised concerns over the management and governance at the tech major. 

Fersht, chief executive officer (CEO), HfS Research, said compared to its Indian and global peers, Infosys has been slow to adopt new technologies. He added Infosys CEO Vishal Sikka has been instrumental in introducing changes such as adoption of the Mana platform or Design Thinking — to encourage innovation among employees to solve problems. 

“It is quite a new phenomenon in the industry and the company on a knife-edge. I think what they will do is that they will bring in some experienced players behind Vishal Sikka to do checks and balances, while he is trying to create a transition strategy,” said Fersht in an interview with Business Standard.   

Sikka recently said the there was a strong need for faster shift to digital. “Having software together with education is something that is critical for our business. This, in essence, is the nature of our journey... If you look at the 3.5 million people in our industry, the only thing that I see in the future is automation,” he said.

The HfS Research head said Sikka had the bigger responsibility of changing the mindset of the people at India’s second-largest IT services provider.  

“He needs to try to change the mindset. Otherwise they might end up having an irrevocable problem. Infosys is not early to the game; they are coming late as they developed Mana and worked on Design Thinking. TCS has already started ignio and Wipro developed HOLMES,” said Fersht. 

Infosys co-founder N R Narayana Murthy has publicly expressed his disagreement last week over the current board’s purported governance lapses, referring to a hefty severance pay to former chief financial officer Rajiv Bansal. The debate was only aggravated when the board replied saying the severance pay was based the employee’s contract.  

Fersht said the Bengaluru-based IT firm would need a lot of fixes to its strategy and Sikka should bring those in. 

“There is a lot of strategy fixing needed. Vishal is making sure Bengaluru and California are developed equally. I think everybody is going through a slowdown in growth and they (Infosys) need to have a bold strategy to revive their business,” said Fersht.