Infosys Case Study, Organizational Structure- Infosys
• India’s best managedcompany – Business Todayand AT Kearney• India’s most admiredcompany – Business Week• Role model in corporategovernance – Forbes• World’s most respectedcompanies – FT• Amongst the “40companies that arereshaping the globaleconomy” - WIRED Magazine•Global Most AdmiredKnowledge Enterprise(MAKE) Hall of Fame
Background Of The Company• Founded in 1981 By Shri N.R Narayana Murthi and six of hiscolleagues• Now on its client list are a number of Fortune 500 companies• First Indian company listed on the NASDAQ• Infosys has a global footprint with 65 offices and 74development centers in US, India, China, Australia, Japan,Middle East, UK, Germany, France, Switzerland, Netherlands,Poland, Canada and many other countries.• Infosys and its subsidiaries have 149,994 employees as onMarch 31, 2012.• Infosys takes pride in building strategic long-term clientrelationships. 97.8% of our revenues come from existingcustomers
Vision, Mission and Values• Vision"We will be a globally respected corporation."• Mission"Strategic Partnerships for Building Tomorrow’sEnterprise."• Client Value: To surpass client expectations consistently• Leadership by Example: To set standards in our businessand transactions and be an exemplar for the industryand ourselves• Integrity and Transparency: To be ethical, sincere andopen in all our transactions• Fairness: To be objective and transaction-oriented, andthereby earn trust and respect
Milestones• Infosys is established by N. R. Narayana Murthy and six engineers inPune, India, with an initial capital of US$ 250 (1981)• Signs up its first client, Data Basics Corporation, in New York• Opens first international office in Boston, US (1987)• Acquires ISO 9001 (1993)• Moves corporate headquarters to Electronic City, Bangalore (1994)• Opens first European office in the UK and global development centersat Toronto and Mangalore (1995)• Opens an office in Toronto, Canada• Infosys is assessed at CMM Level 4 (1997)• Touches revenues of US$ 100 million. Listed on NASDAQ• Infosys becomes the 21st company in the world to achieve a CMMLevel 5 certification• Opens offices in Germany, Sweden, Belgium, Australia, and twodevelopment centers in the US• Infosys Business Consulting Services is launched (1999)
Milestones• 2000• Touches revenues of US$ 200 million• Opens offices in France and Hong Kong, a global development center inCanada and UK, and three development centers in the US• Re-launches Banks 2000, the universal banking solution from Infosys, asFinacle™• 2001• Touches revenues of US$ 400 million. Opens offices in UAE and Argentina,and a development center in Japan• N. R. Narayana Murthy is rated among Time Magazine/CNNs 25 mostinfluential businessmen in the world• 2002• Touches revenues of US$ 500 million• Nandan M. Nilekani takes over as CEO from N.R. Narayana Murthy, who isappointed Chairman and Chief Mentor• Opens offices in the Netherlands, Singapore and Switzerland
Milestones• 2003• Establishes subsidiaries in China and Australia• Sets up a development center in Thiruvananthapuram• 2006• Infosys celebrates 25 years. Revenues cross US$ 2 billion. Employees growto 50,000+• N. R. Narayana Murthy retires from the services of the company onturning 60. The Board of Directors appoints him as an Additional Director.He continues as Chairman and Chief Mentor of Infosys• 2007• Infosys crosses revenues of US$ 3 billion. Employees grow to over 70,000+• Kris Gopalakrishnan, COO, takes over as CEO. Nandan M. Nilekani isappointed Co-Chairman of the Board of Directors• 2010• Infosys crosses the US$ 5 billion revenue mark• Employee strength grows to over 100,000• 2011• N. R. Narayana Murthy hands over chairmanship to K V Kamath• Infosys crosses US$ 6 billion revenue mark, employee strength grows toover 130,000
Services Offered• Aerospace & Defense• Airlines• Automotive• Communication Services• Consumer Packaged Goods• Education• Energy• Financial Services• Healthcare• High-Tech• Hospitality and Leisure• Industrial Manufacturing• Life Sciences• Logistics and Distribution• Media & Entertainment• Publishing
Growth• The turnover of the company has steadily increased• It grossed more than Rs 31,250 crores by March 2012
The Infosys Strategy – Global Delivery Model• Projects are divided into components and areexecuted independently and concurrently at clientsite and partly at the development centers• The components are then integrated into highquality robust solutions.• Development centers that are spread acrossdifferent countries allow Infosys to leverage timezones. ie . It can have 24 hour workdays.• By this model project managers are ensured of totalcontrol .
SWOT ANALYSISStrength• Proven “Global delivery model”• Commitment to superior quality and processexecution• Strong Brand and Long-Standing ClientRelationships• Status as an employer of choice• Innovation and leadershipWeakness• Excessive dependence on US for revenues – 67 % ofrevenues from USA•Weak player in domestic market. Only 1 % ofrevenues from India – low as compared to peers•Low R & D spending as compared to global ITcompanies – only 1.3 % of total revenuesOpportunity• Domestic market set to grow by 20%.• Expanding into new geographies – Europe, MiddleEast, etc• Infosys is cash rich - Acquiring companies to increaseexpertise in Consultancy, KPO and packageimplementation capabilities• Opening offices and development centers in costadvantage countries.Threats• The economic environment, pricing pressure andrising wages in India and overseas• Intense competition in the market for technologyservices could affect cost advantages.• High dependency on a small number of clients, andthe loss of any one of the major clients couldsignificantly impact business.• Currency fluctuations
GENERIC STRATEGIES• To maintain low-cost advantage they have opened offices inCzech Republic, Mauritius, Poland, Philippines, Thailand andMexico.• Invested in developing training centers.• Improved quality capabilities – CMM level 5i company.• Low cost Global delivery 24/7 Model• Focus on quality, customer relationship management, timely-delivery.
GRAND STRATEGIESMARKET PENETRATION STRATEGY:Current Markets: USA and EuropeCurrent Products: BPO, KPO, consultancy services (in BFSI, manufacturingand retail) and software products (financial products).Recommendation: As most large clients in US and Europe are cutting costs,Infosys needs to be more aggressive on cost and quality front.Result of strategy: Unlikely to yield good resultsMARKET DEVELOPMENT STRATEGY:New Market: India, Middle-east and AustraliaCurrent Product: BPO, KPO, consultancy services (in BFSI, manufacturingand retail) and software products (financial products).Recommendation: Since these are fast developing IT market, Infosys needsa paradigm shift in focus from US and EU markets to these markets. Result of strategy: Likely to yield good result.
PRODUCT DEVELOPMENT STRATEGY• Current Market: USA and Europe• New Product: Consultancy and package implementationservices in relatively growing sectors esp. healthcare, lifesciences and aviation sector, and KPO services.• Recommendation: Concentrate on building expertise in thesedomains by strategic acquisitions.• Result of Strategy: Likely to have good result.
DIVERSIFICATION:• New Market: India, Middle-east and Australia• New product: Consultancy and package implementationservices in relatively growing sectors esp. healthcare, lifesciences and aviation sector, and KPO services.• Recommendation: Changing Brand image from low valueservice provider to high value service provider.• Result of Strategy: Difficult to achieve overnight (possible inlong term)
‘‘ The primary purpose of corporate leadership is tocreate wealth legally and ethically ‘’N. R. Narayana MurthyChairman of the Board and Chief Mentor