A week before India’s second largest software firm, Infosys declares its third quarter results, the company has announced yet another slew of key executive level changes. On Friday, Infosys management announced the elevation of board members, BG Srinivas and UB Pravin Rao as presidents of the company — a newly created role at Infy – who would be reporting to current chief executive officer and managing director, SD Shibulal.
Shibulal, Infy CEO and MD, said, “These changes will further enhance our focus on deepening client relationships, increasing market share, creating service differentiation through innovation and agility in execution.”
The appointments — which come two weeks after the departure of three senior executives at Infosys, including V Balakrishnan, who was an ex-board member, head of Infy BPO and head of Lodestone, also see the elimination of the 30-member executive council, which will cease to exist from April 1, 2014.
The appointments on Friday, follow dna’s story on December 22, entitled ‘Crisis in Infosys: Men who Narayana Murthy thought were assets turning out to be liabilities’, which predicted more senior-level changes at Infosys.
Interestingly, UB Pravin Rao, who was elevated to board member the day Bala quit, has in two weeks been entrusted with an additional presidential role, focused on global delivery and service innovation, with the sub-heads of Retail, Consumer Packaged Goods and Logistics, Life Sciences, Resources & Utilities, Services, Growth Markets, Cloud & Mobility, Quality & Productivity and Infosys Leadership Institute reporting to him.
BG Srinivas, who became the hot favourite in the running for the next CEO, after the departure of Bala and Ashok Vemuri, ex-board member and head of Americas for Infy, has now been given a broader portfolio focusing on global markets and sub-heads of Financial Services, Insurance, Manufacturing, Engineering Services, Energy & Communications, Infosys Public Services, Infosys Lodestone, Strategic Global Sourcing, Marketing and Alliances will be reporting to him.
A senior ex-Infoscion, requesting anonymity, remarked, “While these changes will no doubt entail more exits – and possibly more management changes at Infy, it is a good move to clean up the organisation structure, which was getting too large and unwieldy. NRN has taken some risks, but they are needed to centralise and streamlime the organisation, and anyway, it is not a loss if non-performing employees exit.”
Analysts believe the new role creation is aimed at centralising the highly decentralised Infy, and testing the prowess of Srinivas and Rao for a year in the presidential role to see if they have CEO capability, after Shibulal retires in 2015. Shibulal is the last of the founders to retire, and his exit would see the appointment of the first non-founder CEO of the company.
“While this cannot be compared to the two-head leadership at Wipro, although the senior level exits are following a similar pattern at Infy, the elimination of the executive council points to consolidation of roles, which was always part of executive chairman Narayana Murthy’s plan. It could also be a preparation to elevate Rohan Murty in a linear leadership, with NRN at the top as the central decision-maker. It may also be an effort at creating an image to the outside world that Infy is trying to create new blood in the positions recently exited and thus do away with elderly, inflexible leaders,” said an HR expert who closely tracks Infy.
Another IT analyst who did not wish to be named said, “Giving Srinivas a client-facing role and Rao a delivery-facing role, as single points of contact, as compared to a huge council will no doubt aid in faster decision-making and efficiency, leading to better competitiveness to win contracts, which more centralised peers like TCS and Cognizant, have been winning . The elimination of the executive council will have no impact on Infy’s operations, as the members will go back to their non-EC roles.”