'Vishal Sikka Means Lots of Money': Narayana Murthy on New Infy CEO

"Vishal Sikka means lots of money," said Infosys founder Narayana Murthy as he detailed the massive top-level changes that the IT major has announced today.

Addressing a press conference, Mr Murthy, 67, welcomed 47-year-old Vishal Sikka as chief executive officer. This is the first time India's second-largest IT services exporter has not chosen one of its founders for the role, as it looks to regain market share and stem a staff exodus.

(Read: Who is Vishal Sikka?)

Mr Murthy said he would step down on Saturday, nearly a year after he was brought in from retirement to help the company better compete with rivals like Tata Consultancy Services (TCS) and Wipro.

(See: Who said what on Vishal Sikka's appointment)

"I welcome our newest Infoscion...I am equally pleased to announce that our colleague for 28 years Pravin Rao has been elevated to COO," Mr Murthy said, also announcing that as his office as executive chairman is dissolved, his Rohan Murthy will leave the company.

(Also read: Hope Murthy takes our calls, jokes new Infy chief)

Mr Murthy's latest tenure, during which he brought in his son Rohan as an executive assistant, has been marred by high staff turnover and management uncertainty, factors that led to loss of market share for a company that was once a leader in India's $100-plus billion (Rs 6 lakh crore) a year IT export business, and intensified investor pressure for a change of guard.

Dr Sikka's biggest challenge as Infosys CEO will be to fill the leadership vacuum created by the exodus of senior executives, many of whom were responsible for key business sectors and winning clients, analysts said.

Mr Murthy said, "The highest honour in my family is reserved for scholars. Vishal has a PhD, he is special to me." And also, "As a south Indian I did not know what Sikka means. He told me it means money. So Vishal Sikka means lots of money, big money. This is what we need for Infosys."

A former executive board member of German business software company SAP, Dr Sikka will take over on August 1 from current CEO S.D. Shibulal, who along with Mr Murthy, executive vice chairman S. Gopalakrishnan and four others founded Infosys in 1981 by pooling together Rs 10,000. Mr Gopalakrishnan will also set to step down on Saturday.

At least 11 senior executives left the company since June last year when Murthy was brought back from retirement, triggering uncertainty at the top and dimming the company's status as the employer of choice for young IT workers, with staff leaving at an unprecedented pace.

The company will hold its annual shareholders meeting in Bangalore, where it is based. Mr Murthy, one of the pioneers of the country's showpiece outsourcing services sector, will be designated as chairman emeritus from October 11 "in recognition of his contributions to the company", a company statement said.

Infosys shares, the most widely held Indian stock, rose as much as 3.2 percent in early trade, but were trading down 0.15 per cent at 1:22 p.m. with some dealers saying the new management would take time to turnaround the company.

(With inputs from Reuters)