Murthy Says Non-Performance Led to Management Exits at Infosys

Infosys founder NR Narayana Murthy on Thursday reiterated that the company has had little impact from the recent exits of senior level executives. "Out of 12 executives who have left, only three were customer-facing. The rest were part of auxiliary services and they were not adding value to customers," Mr Murthy said at an investor conference.

"One (top-ranking executive) left for personal problems and he continues as a consultant," he added.

Mr Murthy's comments came on a day when Infosys named former SAP chief technology officer Vishal Sikka to lead the company.

At least 12 top management executives have resigned from Infosys in the run-up to Dr Sikka's appointment as the new CEO. Among them are Infosys' global sales head, head of US sales, BPO sales head, India head and a former chief financial officer.

"The very fact that the management has doubled the growth rate from 5.8 to 11.5 is a clear testimony of the fact that the departure of these people had no impact at all. We have increased our margins by 200 basis points after giving salary hikes twice in one year," Mr Murthy said.

There has been speculation that the spate of exits at Infosys was linked to the battle for the chief executive's chair, but Mr Murthy today stressed that not a single person who was indispensable for Infosys was allowed to quit the company.

"Some (executives) were rated as low performers by the board... some were rated as low performers by the management," Mr Murthy replied when asked about the spate of resignations at India's second biggest IT outsourcer.

Mr Murthy's tenure, during which he also brought in his son Rohan as an executive assistant, was marred by restructuring that triggered uncertainty, factors that dented Infosys market share, dimmed its status as the employer of choice for young IT workers and intensified investor pressure for a change of guard.

Mr Sikka will take charge as CEO from August 1. Both Murthy and executive vice chairman Kris Gopalakrishnan will step down on June 14, Infosys said in a stock market filing. Mr Murthy will continue in his role as non-executive chairman till October 10 after which he will assume the role of chairman emeritus.

On his future role, Mr Murthy today said "the title of chairman emeritus is just recognition" and "other than the title I have no responsibility, authority and obligation at all to Infosys."

(With inputs from Reuters)