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Infosys unveils plans to globalise operations

Fakir Chand in Bangalore:

Infosys Technologies, the leading Bangalore-based bluechip information technology company, is drawing out strategies to globalise its operations in the new millennium.

Infosys (turnover Rs 9.21 billion) has secured the unanimous approval of its shareholders to increase the strength of its board of directors to 18 from the present 12 through a resolution at its 19th annual general meeting held in Bangalore on Saturday.

Infosys Chairman and Chief Executive Officer N R Narayana Murthy informed the shareholders that the company's nomination committee had recommended the induction of three senior executives as additional directors on the board. They are: Phaneesh Murthy, senior vice-president, sales and marketing for communication and product services, based in the US; Mohandas Pai, senior vice-president for financial administration and chief financial officer, based in Bangalore; and Srinath Batni, senior vice-president for delivery, based in West North America. The remaining new directors will be appointed during the course of the current finanacial year (2000-01).

Murthy hinted that the company would go in for strategic overseas acquisitions now that the Indian government has cleared the decks for automatic approval of such acquisitions to the tune of $ 2 billion, or ten times the net revenues achieved by a company in the preceding financial year.

Murthy said: "I would like to emphasise that, given the tremendous management attention required in order to unlock value from an acquisition, Infosys will opt for this step if and only if it brings in significant strategic benefits along with revenue and net income enhancement commensurate with such effort."

The company had earnestly began exploring acquisition opportunities, to make selective investments, and to encourage budding entrepreneurs within the organisation by incubating their ventures, Murthy said. "We made our first investment this year in Massachusetts-based EC Cubed Inc, granting it $ 3 million in funding, and piloted Onscan, a Web-focussed wireless-enabled notification service," he added.

In line with its globalisation move, plans are underway to set up Infosys's third Proximity Development Centre in the UK soon. This will be in addition to the global development centre set up early this year at Toronto in Canada, and two PDCs at Fremont and Boston in the US of A.

Infosys has also entered into a partnership with SAP AG, the German-based leading provider of inter-enterprise software solutions, to develop and co-source the mySAP.com marketplace. The company has signed up with several leading-edge convergence companies and has launched a product co-development service.

Infosys is working with several global IT players such as the US-based Quintessent, a leader in the telecom industry's integrated services revolution; with Jetstream for voice-over-broadband solutions; with CIDRA to develop photonic products for bandwith management in the next-generation optical communications networks, and with Cephren for providing online services to the global construction industry.

During the fiscal year ended March 31, 2000, Infosys obtained accreditation to level 5 of the SEI Capability Maturity Model or CMM after fully leveraging the value of level 4 implementation of the CMM.

Infoys has received 184,000 job applications in the last quarter of the year, of which about 2,050 were hired, though it made offer for 3,000 placements. The attrition rate was also the lowest in the industry with only 9.2 per cent of its workforce leaving the company for greener pastures.

The board of directors has also secured the approval of the shareholders for an enabling resolution to increase the aggregate holding of the foreign institutional investors in the company to 40 per cent from the existing 30 per cent of its equity base.

This is in accordance with such a provision being made by the Union finance ministry for the current financial year, and subject to the clearance of the Reserve Bank of India.

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