Vishal Sikka's game plan for Infosys

Can the storied firm lead the Indian IT industry out of a rut?

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As Vishal Sikka settles down at the head of Infosys, he is slowly unveiling his strategy. The overarching aim: to take it into the future and not keep doing the same old things in the same way with incremental improvements. Mr Sikka has spelt this out by declaring that the company will acquire the technologies of "tomorrow", not "yesterday". Simultaneously, he has pointed to a major shift in focus. Infosys, which has been acquiring a huge cash pile because of its conservative approach to acquisitions, will now reverse gear. It will not go for large concerns that can immediately add to volume, but small innovative start-ups in areas like automation, artificial intelligence and "the internet of things".

Infosys was one of the pioneers in evolving a distributed development model - software "factories" around the world far away from clients. It now seeks to power its teams with collaborative technology, so that these can work more effectively with customers. Eventually, it hopes its established clients will be able to put together their own project teams within Infosys. The use of automation in specific tasks has already cut costs by as much as 40 per cent; but what will the staff do as routine functions get more and more automated? The new aim is to train more, pay better, offer more promotions - even quarterly - and to institutionalise a process of listening to what the staff have to say about issues from gymnasium timings to work practices. With this, Infosys, once a firm with low attrition, will seek to step back from the over 20 per cent attrition level of the last quarter. Simultaneously, it has increased hiring of sales professionals in the United States and Europe who can offer increasingly higher levels of consultation to clients. So the whole strategy rests on three legs - offering cost-effective services to clients, through better trained staff, by using newer technology.

What Mr Sikka plans to do has a clear bearing on where he comes from. He was head of products and innovation in SAP, which created the enterprise solutions serving as the information technology (IT) backbone for many firms. Most fundamentally, he is trying to yank Infosys out of the rut that faces all major Indian IT services providers - the danger of becoming providers of commoditised development and maintenance services that rely on the number of hours and of heads to generate volumes. Hence, Indian IT's cries of protest when the United States tightens rules for issuing visas to those sought to be posted at client sites. If all goes well, Infosys can be at the intersection of services and products with underlying intellectual property. The channel to the latter will be provided by the small technology start-ups that will increasingly be acquired. This scheme of things has improved analysts' perception of the firm.