In a move reminiscent of Narayana Murthy returning to his beloved company decades after he steered it to IT outsourcing glory, now co-founder and former CEO Nandan Nilekani has returned to the fray as non-executive chairman of the crisis-ridden company.
To say that Infosys is now in a mess is an understatement. It all began when Murthy, perhaps the most celebrated individual in Indian IT, proved instrumental in hiring Vishal Sikka away from SAP where he was the CTO three years ago. Sikka, although not transformational in his role at the company, was responsible for steering Infosys away from the rapidly declining work involving infrastructure maintenance and application development and onto newer and more urgently needed skill sets in AI and automation.
However, Sikka resigned last week amidst fractious interactions with the man who hired him, although Murthy contends that his problem was with the Board and not with Sikka per se.
While Infosys didn't exactly stage a resounding comeback, it did stabilize somewhat and in the last year or so actually showed signs of a modest revival of sorts. While Sikka did lose 10 of the 16 people he recruited from SAP to forge a new path in the digital realm, the Infosys stock did rebound by 22 percent since he took over and investors were reasonably happy.
All that is now consigned to the dustpiles of history and the company has a Herculean task of attracting a top notch CEO to navigate the company through perhaps the most troubled waters the industry has seen. Which is why Murthy has persuaded the powers that be to pick Nilekani, perhaps the man most suited to the job and other than Murthy, the most talented CEO the company has seen (at least amongst its co-founders).
While Murthy was more of an execution guy, Nilekani was the visionary. It was his comment that the "world was flat" which Thomas Friedman seized to title his book of the same name which went on to become a global bestseller. Author of the hefty and well received "Imagining India" and picked by the government to conceptualize and execute the national universal ID program (Aadhar), Nilekani has proven himself to be an agile and talented thinker over the decades with an appetite for the big picture as well as application required for nitty-gritty.
Yet, his task as the Infosys chairman with the mandate to hunt for a global CEO may be the toughest job he has yet to confront. For one, no CEO in his or her right mind would want to take up a job which entails having to constantly navigate the rocky shoals that lie between the founders (namely Murthy) and the Board.
Murthy kicked up an almighty row in the last few years when he felt that there was widespread impropriety in both the acquisition of a company (Panaya) as well as the paychecks and severances given to senior management. And while he may be onto something regarding the Panaya acquisition it can be an exhausting task to constantly have to provide explanations to a co-founder who along with his cohort only own around 12 percent equity in the company. (According to livemint, a portfolio manager at Oppenheimer Funds had apparently fired off a letter to the Infosys board earlier this year saying it should "contain inappropriate interventions by non-executive founders" and telling the founders to "come to grips with the reality that [Infosys] is a public company.")
In fact, it is this attitude of entitlement that has infuriated many. Instead of treating Infosys like a professional company, every co-founder was allowed to do stints as CEO of the company as if it were their birthright, something I can't remember any other company doing.
How well Infosys does in the future under a CEO recruited by another ex-CEO now acting as chairman will most definitely depend on how much breathing room he or she gets from the man who gave birth to it, as well as the Indian IT boom.
PREVIOUS AND RELATED COVERAGE
No one in their right mind would want to inherit a job that brings with it meddling founders at war with an out-of-sync board, where acquisitions will be endlessly questioned if they happen at all, and a climate of conservatism in business strategy abounds when risk taking is the only antidote for survival.
While the glory days of double-digit growth may forever be over, creating new opportunities in digital will be the only way toward a more robust future.