There is something deeply moving about comebacks by legends. Be it in sports or business, music or politics second stint by eminent personalities has always generated much attention among the commoners. Primarily the interest is to see if they can rekindle the magic that made them a household name in the first place. Hence the scrutiny around N.R.Narayana Murthy is no exception. Now that he has quit his executive position in Infosys for the second time, jury is out whether his comeback was indeed successful or not.
Narayana Murthy and his 6 other colleagues founded Infosys from scratch in 1981 when the word “startup” hadn’t become fashionable. Envisioned with rare skills, technological brilliance and impeccable work ethics Infosys became one of the few Indian success stories at that time. It became India’s second largest software company behind TCS. Experts were extremely bullish about its future in the times to come. So when Murthy decided to hang up his boots in 2011, there were no visible signs of an upcoming storm.
But sadly Infosys stuttered in front of steep challenge from the likes of Cognizant, HCL Technologies, TCS. Seeing his baby in deep trouble Narayana Murthy had to come back to active role in 2013 when the board appointed him as Additional Director and Executive Chairman for a period of five years.
Murthy himself said that it will take him 3-5 years to get Infosys back to its past glory. But in the past one year, Infosys has only seen high profile exits including those who were touted as future leaders. Investor and client confidence plummeted rapidly. It continues to make profits but its operating margins are falling, revenue growth is modest in comparison to its competitors. It has lost its second spot to CTS. To avoid a meltdown, Infosys announced in April that it is looking for a new CEO. Infosys even decided to file lawsuit against media houses for doing speculative stories regarding exits of high profile names.
Narayana Murthy though looked satisfied as the company announced that Vishal Sikka former Chief Technology Officer at SAP will take over the post of Chief Executive Officer (CEO) and Managing Director (MD). He is the first non-founder to being given the top job at Infosys. To ensure that Sikka gets a free hand founder members including Murthy who were part of the board has decided to step down from their executive roles. Narayana Murthy put up a brave face yesterday when he said that he has achieved what the board asked from him in his second stint. According to Murthy his work was to find an able successor to current CEO S D Shibulal which has been accomplished.
What the visionary entrepreneur carefully didn’t mention was his work also was to rejuvenate the company to his past glory. The fact that he roped in his son Rohan Murthy to join him as executive assistant clearly indicated that Murthy was looking for a long innings. But Rohan’s inclusion only compounded the problems. Murmurs started about Rohan being groomed for the top post, a practice uncommon with Infosys. The IT giant at least in public perception was fast emerging like some of our political parties where writ of the “high command” rules large. It is perhaps no surprise that Rohan will also relinquish his position post this massive shake up.
What prompted this change? Did the board members indicate to Narayana Murthy that his time is up or did his inner voice of reason played the deciding role. There is no way to know the truth except may be a “tell all” book in future. But what certainly disheartened Murthy was his strategy to change track didn’t bore fruit. The much touted Infosys 3.0 strategy of shift from bread and butter service provider to emphasize on making sophisticated product for the long haul bombed. It may have been a good plan but in a market still iffy with low growth the strategy was met with cold reaction. Narayana Murthy arguably the most respected businessman in India known for his philanthropy probably overestimated the maturity of investors who are still quite short sighted in their vision.
In a sense Narayana Murthy became a fall guy in the company he originally founded. But he has salvaged his pride and reputation with one sweeping stroke by appointing an outsider to the top job. Many believe by sacrificing himself he has saved his brand. It’s not that Infosys will again become a top draw very soon. Sikka who is primarily a system professional has to quickly learn the art of service which is the core focus of Infosys. He may succeed or fail, but atleast Narayana Murthy will not be accused of putting his hubris ahead of the future of the company. In a nation where icons fall from grace very rapidly, Murthy has managed to earn fresh respects. That is indeed a sobering thought.