Finally, Infosys open to outsider as CEO, but insiders may have edge

Apr 12 2014, 01:29 IST
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Shibulal took over as the CEO in August 2011 and was expected to retire in March 2015 when he turned 60. Reuters Shibulal took over as the CEO in August 2011 and was expected to retire in March 2015 when he turned 60. Reuters
SummaryInfosys announced it has begun the search for a new chief executive officer to succeed SD Shibulal, who retires next year.

are other business heads like Sanjay Jalona, Manish Tandon and Sandeep Dadlani who also stand a fair chance of becoming CEO. At one time, it was believed former Microsoft India chairman and current Infosys board member Ravi Venkatesan could take over from Shibulal. An industry observer said it would be difficult for an outsider to align with the company’s culture and this would take a considerable amount of time, which Infosys cannot afford during these challenging times.

Second, the presence of NR Narayana Murthy within the company, with his larger-than-life image, could be a challenging factor for an outside CEO as the Infosys chairman is expected to remain till 2018. During an investor call with Bank of America-Merrill Lynch on February 19, Murthy had said that Infosys would not be changing its current strategy even with the new CEO taking over. “That (strategy) will continue as we move forward and the new CEO will be in place by the time Shibulal is ready to leave, sometime in March 2015. I will be available for him to ensure that there is a proper transition,” Murthy had said.

A section of the industry is convinced Infosys needs to appoint an outsider as the CEO so speed up its recovery with fresh ideas. This time there is a stronger possibility of an outsider taking the role, they said.

The potential CEO search could also see Infosys taking the bold step of appointing a non-Indian, preferably somebody from the US, to head the organisation. Murthy has in the past said that there is always a possibility of a foreigner heading Infosys, which would be very unlike its peers, Tata Consultancy Services and Wipro. Industry observers believe the entire process of CEO selection by Infosys is expected to be more rigorous this time unlike in the past, now that the company is going beyond the founder group to choose the CEO.

Shibulal’s tenure was marked by a considerable degree of instability within Infosys. The firm steadily lost its position as the pre-eminent leader of the Indian IT industry, necessitating the return of Murthy as executive chairman in June 2013 to help steady the ship. Murthy’s son Rohan Murty joined Infosys as the chairman’s executive assistant. The period also marked the exits of several top-rung leaders, leaving an uncharacteristically thin leadership at Infosys.

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