Infy has shifted from outsourcing to outcome-sourcing model: Chandrashekar Kakal

Chandrashekar Kakal, senior vice-president and global head of Infosys Business IT Services, tells Beryl Menezes how the winds of strategic change are transforming the organisation and the nature of its relationship with clients. Excerpts from the interview:

What are the key changes in global sourcing of IT services today?
The primary goal for most organisations in the current economic climate continues to be optimisation, with almost 60-70% of IT budget spent on running the business, on areas such as data centres, networks, test environments. Companies are now looking for ‘strategic partners’ who can be entrusted to manage end-to-end critical business applications and processes efficiently and cost effectively. For IT service providers, this means a strategic re-focusing to match evolved customer requirements by becoming partners rather than mere vendors.

How is this change taking place at Infy?
As a direct response to this trend, the creation of a unified core services group has allowed Infosys to evolve from being ‘IT vendor’ to ‘IT partner’ and a ‘business enabler’, across service lines. The benefits of this new approach are being passed on to the client and the savings generated are used to drive greater discretionary spending towards IT transformation and innovation programmes.

Infy recently adopted a new ‘outcome sourcing’ model. How is this different from traditional outsourcing?
Outcome sourcing is a trend wherein the emphasis is on actual results delivered by the vendor to the client. As opposed to traditional outsourcing where the focus is more on input costs and simply reducing those costs, outcome sourcing focuses on providing measurable business benefits to the organisation. Since the emphasis is on delivering results that matter to the client, outcome sourcing fosters more innovations and a closer alignment of a vendor’s incentives with business requirements.

Are other IT companies also adopting Infy’s outcome sourcing model?
As organisations come under increased pressure in their areas, they will need to look at additional levers for efficiency, in addition to simple cost-cutting measures, even as the traditional outsourcing model becomes increasingly commoditised. For instance, by automating repetitive support tasks such as ticketing, incident management, so on, a significant amount of reduction in time and effort is possible – this, in turn, means that resources freed from these activities can be redeployed elsewhere.

Infy recently partnered with IPsoft to add autonomics to your services mix. What kind of investments have you planned in the space of autonomics services?
Infosys and IPsoft have entered into a partnership to combine IPsoft’s autonomics capabilities with Infosys’s existing managed services model. Over 4,500 Infosys employees will be trained on the autonomics platform of IPsoft in the next 12 months.

Currently, we have over 12,000 Infosys personnel already oriented towards service automation. We will be offering these services in the infrastructure support area, application support and BPO services. We are confident that autonomics could bring to IT support and maintenance the same kind of productivity gains that robotics has brought to manufacturing industry.