Will seek Narayana Murthy's advice when needed: Vishal Sikka
"Narayana Murthy has told me very clearly that he will not interfere... not second guess... but I would love to get his advice"
The future of Infosys will be built on the current edifice with organic growth being the driving force though acquisitions will be made to add new capabilities. In a free-wheeling interview with ET , a relaxed Vishal Sikka spoke of how he plans to motivate employees by writing cutting edge new generation software.
ET: The burden of expectations must be considerable...
It has been quite humbling. There is tremendous weight of responsibility that I feel but at the same time, it is balanced by a great sense of excitement and optimism. There is that duality. The trick in this case is to ensure that the excitement and the optimism always stay ahead.
ET: There must be a sense that the saviour has come...
I think this whole idea that one person can have the instinct and the know-how and the intellect to be smarter than anyone else in such a large organisation is nonsense. In today's world, the same communication and computing technology that flattens access and opportunity for everybody also does that inside an enterprise. Therefore a much more decentralised and open management approach is a much better approach than what was relevant twenty years ago.
ET: There has been a sense of crisis, has there not?
Obviously there has been a lot that has happened in the past. I like to learn and reflect but I don't like to dwell on the past. But there has been a lot that has happened. Leaving of the founders is itself a very big event in the life of a company. And then there has been a lot of all this attention from the media (laughs). I tend to think of it as a reflection of how important the company is to the country. And it adds to the stress and so it is a burden that we have because of who we are and I take that very seriously.
A couple of weeks ago I thought about things that are on people’s mind and I launched a little initiative (UB Pravin Rao, COO, and I). It’s called ‘Murmuration.’ It is this really beautiful act that nature puts on where you see massive flocks of birds flying around. Up to 250,000 birds can be seen can make a giant flock and they make beautiful patterns. They are not really governed by any central directive or initiative that came from the CEO of that flock of birds or the head of HR from that flock of birds. They just fly and they do their magic.
I did a video, Pravin wrote a mail. Learning about your ideas on what some of the things you see with customers and some of the ideas and innovations that customers are looking for. Also what are the skills that you see that the world will need and you need. And what are some of the skills that you have that you would like to teach others and how will you do this. We got an incredible response on that. The video and the letter were viewed more than 27,000 times. Now, I want to see all of these ideas. So you can feel the engagement from the team.
What is on the minds of Infosys employees?
It is all about innovation and getting better. They are in this two buckets--how do we improve the work we have done and how do we do new things? It is still very early having left SAP after 12 years there and having taken this decision so quickly, I haven't had a chance to still absorb what the company does. I don't have much new to tell you yet but as we go forward, more and more instincts will develop and new goals will become more concrete.
But I am as excited, if not more, about adding to the new set of things that can be done. Software is reshaping the world around us. Everything around us is becoming more and more around software.
We are living in a software defined world. And so that impacts every industry. It impacts every walk of life. That is creating opportunities to build some great new kinds of software and I want to do that. I want us to be there in the great problems that are emerging around artificial intelligence techniques, deep data science and big data techniques, analytics and so on. Finding new energy sources, digital oil fields. This is the big thing in the minds of people in the oil and gas industry. New ways of exploring energy. In manufacturing, it is becoming predictive 3D printing.
Calculation of risk in banks, insurance companies is a huge unsolved problem. They run on these legacy systems that have no connectivity built in. Solving these great problems of our times...in retail, digital marketing. I want to be able to go after those big problems with our existing clients and with our new clients. And other kind of things. For example, working with startup companies. We have had this $100 million fund that the board and shareholders approved 8-9 months ago. I want to put that to use starting tomorrow. To work with startup companies, to work with venture capitalists who work with them.
I see us as a great amplifier. Once a startup raises venture capital, their primary problem is around achieving scale quickly. They want to get to global access. They want to get their roadmaps very quickly because they are in a fight for lives. And they are in a fight for talent. In the valley, there is a ferocious battle for talent. They can work with us and we can become their amplifier to accelerate their roadmaps to get to scale more quickly.
ET: Would it be like a corporate venture arm?
All of that. Work with them as new kinds of clients with new processes, new ways of working and so on potentially with equity. But also with venture investments through that. Details still have to be worked out. I've talked to a few people that I know of and they are all extremely excited about this idea. Our engineers are excited about this idea because they want to work with what is happening in the startup world here, in Silicon Valley. Working with this new class of customers and partners but also our own products and services like Finacle which is a leading banking product. People often ask me are you going to take the company towards products. That completely misses the point. The whole revolution that is happening is happening around services. So why would I make a services company a product company? The idea is to bring that economy of scale that intellectual property brings into the services.
Infosys CEO Vishal Sikka brings in new intiative, Murmuration, to generate ideas
ET: You want Infosys to be at the centre of the so called new manufacturing revolution?
Absolutely. I was at the assembly plant of Daimler in Germany a few weeks ago. The CIO of Daimler is a friend of mine. He invited me and my older son to go there. It was amazing to see those S class being manufactured. They are a very distinguished client of ours too. You see that and you see how software is making its way not only inside the car. The S class has hundreds of millions of lines of code in it but also the assembly line itself. How that defines the way the car is manufactured, governs people and makes sure things are done to the right quality. There is so much more that can be done there. In Germany there is this initiative called industry 4.0. It's all about bringing software into manufacturing, machines, to engineering practices. I would love for us to become the leading provider of these things.
ET: This would be quite a different Infosys from the current company?
I don't think so. We have designed wings of great airliners, landing gears, routers and high-tech manufacturing equipment. We have built great applications that are not widely known. We can't create two different companies -the one that does the new sexy stuff that Vishal is interested and the other is the boring dull stuff. This is not the point. The key is that the same teams... perhaps there are different practices. Perhaps there are different contracts, project methodologies but the same people. You know Toyota manufactures the Lexus (as well as basic cars).
ET: Don’t you believe there is an Innovator’s Dilemma?
I actually don't believe that there is an Innovator’s Dilemma. The observations of the Innovator’s Dilemma (a concept espoused by the thinker Clayton Christensen) are not wrong. There was a lot of debate about it recently among Harvard professors. My experience has been that this idea that there are these group of disruptors and they will come and disrupt you. This is not that. Nature evolves adapts to change all the time. That brings to a very important point. In nature, you see adaptation happen all the time and our mechanism of change is learning. Education. Every company that goes through a transformation does that on the basis of learning. Our only mechanism is to adapt to learn and to educate ourselves. Learning is at the heart of any company's transformation and at the heart of our company's transformation. So this is why I actually came to Infosys. My deep belief is that if we can learn anything, we can do anything. We have a company where learning is at the heart of what we do, learnability is one our values and I find that as a student myself, very very exciting. That gives me the confidence that this company has it within it to do these kind of ambitious things that we are talking about.
ET: How will you persuade the new graduates to join Infosys and not TCS or Cognizant or a startup?
They are all distinguished companies. I would say that this is the company that put India on the map of IT services. We did the iconic, pioneering work in this area, and we will do that again. I feel confident because of this basis of education and learning--in Mysore we can train 16,000 people at the same time. Nobody else does things like this. That gives us the core ability to create a workforce that can do anything and that is a distinguished environment to be in. And beyond that we have a culture. Yesterday, we had a farewell ceremony for (former CEO) SD Shibulal and (delivery head) Srinath Batni. And I have seen farewell ceremonies before and people don't work like this. There is a deep humanity and a heart-felt warmth in this company.
ET: Can you walk us through how you took this decision to join Infosys?
I think it happened very quickly. But it is one of those opportunities that when you get that you say I have to do this. This is Infosys, this is India, this is an iconic company, and you simply cannot say no to that. The important thing was that I live in California and I wanted to have that to be a strength and not a weakness. Everyone I talked to was completely comfortable with that. So the only practical matter was if we could organise ourselves in a way that I can be here approximately one week every month and it will still be okay. And we have done that with Pravin (UB Pravin Rao, Infosys COO) and he will run the day-to-day operations. In any case, more than 60% of our business is in America and almost 25% is in Europe.
ET: How did you know Mr Narayana Murthy? And when did the conversation about joining Infosys start?
I first met him in December. After I left (SAP), I called (board member) KV Kamath--I've known him for quite some time--to inform him that I've left SAP and he said that's good to hear. He had earlier suggested that I join the board of Infosys. And the next day I got an email from a recruiter that there was a search going on at a large company and that happened to be Infosys. So, I spoke to that recruiter and then I called Kamath back and he said ‘I didn't think you'd be interested in this, would you consider this?’ And then we debated this idea of US and India and then he said well if you are interested then I am running this search as a head of the committee and you know it has to be done in this way. I said let me think about it, talk to my wife. That was how it started.
ET: What did your wife say?
My wife said that you cannot say no to something like Infosys. So when I said okay to the recruiter they asked me to come to London for a half a day and I think there were other candidates who were also there. Many of the board members were also there. And on the way back, Kamath called and said ‘The board really loves you and is this something you'd consider?’ So I said ‘Let me go home, talk to my wife and think about this and let us talk again next week.’
By the time I land in San Francisco, I have an email from ET that ‘I am going to publish that you'll be the next CEO of Infosys unless you deny it.’ And I said ‘Oh my God!’ So that actually set off this frenzy and what happened was that this story got published the day before SAP Sapphire, which is SAP's primary customer conference and apparently there was this incredible buzz...Nothing had happened yet, only an expression of interest that we would like you to consider. There had been no discussion on any details.
As a result of that frenzy this created, I ended up getting back on the plane coming back to India and having more detailed discussions. So, all of this...I believe if (ET’s technology editor) Pankaj (Mishra) had not published that thing, this would have taken a more peaceful journey. Probably the outcome would've been the same.
What about employee engagement with new ideas?
I think the important thing is that you have open work environments where people can think in an open way and so on. They cannot all be in the CEO's office. The important thing to learn is that innovation cannot be the domain of a chosen few. Everybody can do innovation. One of the things that people obsess over in our industry is utilization, and I’ve been reading up about this, thinking about this, and this idea seems to be flawed to me. First of all, if everything was always running at 100%, you would miss the point. This is just a recipe for burnout very very quickly. Any machine that runs at 100% capacity has not been designed properly. In Formula One cars, there is a kinetic energy recovery system called KERS. What happens is that because these cars are so high performance that when they brake on a turn or something they release an incredible amount of energy and that usually used to be lost. So they put in these KERS systems inside the cars to capture that energy and there is a there are a few different types of these kinetic energy recovery systems.
There is a fly wheel running in between the four wheels and that just revs up to a very high rpm like 20,000 rpm or something. And, and then when the driver needs that energy, he can release that from the fly wheel and then the car goes faster. So what is the equivalent of the kinetic energy recovery system in a company like Infosys ? This is something that would be very interesting to think about and work on. I’m not saying that improvement in utilization is a bad thing. Of course we should do that and the operational people should do that but they should also rethink that. We have a brain and we have to think and we have to innovate. Some of the ideas could be things like when people are, for whatever reason, not on a project, they could be working on a product; they could be working on capturing their learnings; they could be working on learning something new, they could be working on teaching something new. So there are ways for the company to recover the kinetic energy from the excess capacity which is temporary. So, the point is that innovation has to be done everywhere in the company.
ET: Tell us more about the timelines, priorities.
It is too early to tell. In design thinking, there is desirability, there is economic viability and there is feasibility of what is possible to be done. And that depends on a lot of factors that I don't know yet. Time will tell how long it'll take but obviously, sooner the better. But there is one reality of a services company. For actions that we take now there is an inherent latency. In a products company you have latency in building a product but once the product is done there is no limit to how quickly it can scale.
ET: If we are meeting again a year down or three years from now, how will you like us or anybody to measure how you've down.
We used to be the company that used to be the measure of the industry. I want to get back there.
Would you use Murthy as a sounding board?
Absolutely. I would love to get his advice. He has told me very clearly that he will not interfere... not second guess or any other, and he has made it crystal clear. But on the other hand, I feel like I would be totally remiss in my job -this is an incredible iconic pioneer in the country not only in the industry. In the life of a company there comes a time when the instinct of the founder has to be transformed into an institutionalised structure and processes.
ET: Most companies don't do particularly well at that.
We are at that moment here in this company. But nevertheless, as we go through this transition, I think, it will be very important to count on the instinct of Murthy, also (cofounder) Kris Gopalakrishnan. Kris has had an incredible say in this company. I spent a few hours with him yesterday and he has such a vast knowledge of things. I have asked him to continue to mentor us and advise us especially on the science and technology aspect and he is thinking about... He said, no Vishal, this is yours now. You can always ask us for advice. And Shibu who has such a deep operational understanding. Not only am I counting on asking them for advice and thoughts and guidance, but I feel like I would not be doing my job if I did not
ET: Would you eventually like to overtake TCS? In terms of revenue or profitability?
Our brains are wired to think about reality in a relative way. It is gratifying to see how you're doing with regard to competition and so on. But the true measure of our success is between ourselves...within ourselves and between us and our clients. And so I don't want to measure myself of what can happen to the operations and fortunes of another company just by how well we can serve our clients.
ET: What is the broader shift you see in IT services space?
We can see the results of the large traditional infrastructure companies and the new ones like Amazon and Google and so on..I think there is clearly a shift there towards these kinds of open stack and open compute and new kinds of hardware systems and new kinds of cloud systems that are being made by companies. I mean traditional companies also. (For examples) IBM recently acquired Softlayer and things like that. There is a great transition happening in that world and the layer above that, which is the software platform layer. Our lives are increasingly governed by software but almost none of it is written on any of the traditional enterprise platforms anymore. There is a great set of things happening there around new ecosystems, new open platforms, open source and I see that as a huge opportunity for Infosys.
And then the layer above that is the layer of applications. Here we have on one hand, legacy applications and on the other hand, emerging classes of new applications. If you look at the new cloud applications - most of the applications are enterprises are still either too small or very early or rethinking of traditional applications. The opportunity to make new kinds of applications is still wide open.
And that brings us to our layer. And here, I get the feeling that while there is growth happening broadly in the industry ..We are in kind of a downward spiral. There is an increasing competitiveness on cost, doing the same kind of things, becoming efficient. Instead you want to turn this thing the other way and go towards higher value, new kinds of things, new kinds of applications. In many ways it’s the only layer of the IT stack where there is no structural limitation. The only structural limitation is inside us. It’s in our own past, in our own business model and economics. Otherwise the software platforms are being disrupted by new platforms, open source platforms and new kinds of platforms like Apple and Google. The traditional enterprise platforms are being disrupted by these people building on the Apple or Android platform.
Infosys CEO Vishal Sikka to staff: A privilege to lead the company
Sikka: Yes, this next generation set of problems. And then of course while continuing the traditional business, not to disrupt that but to become even better at that. While that innovation may not be a tremendous economic driver immediately. It will take time for it to become a key revenue driver. But (nonetheless) it becomes a confidence driver immediately. Not only for us but also for our clients. And then over time, it becomes the revenue driver. I did this with HANA and it was the same things.
ET: Could you build a Watson (IBM’s artificial intelligence platform) from scratch?
Of course. We can do all of that. Watson-like applications complex intelligent applications. Watson itself is IBM's innovation and it is very painstaking to model intelligence and expert knowledge and systems like that.
ET: But Infosys can build systems like that...
Yes we can build software like this. Why not? They showed me... recently, some security systems that we built. Physical surveillance and monitoring systems and things like that. We have built... we have put software inside clutches from German car manufacturers and in actual drive trains of cars. Massive amounts of software written by us that is running there. These are the areas we have to get into--complex intelligent applications, data sciences, analytics.
ET: Will Infosys under you be more active on deal street?
I think organic growth is incredibly important because it creates a culture of confidence that we can do things. But you also cannot become completely closed. And so you have to be open to new ideas. If you look at this framework, you want to buy new capabilities, new skills that you don't have and integrate that inside the culture of the company.
ET: Is Silicon Valley a good hunting ground?
Of course. Although valuations in the Valley are ridiculous.
ET: Since you have a Vadodara connection, what are your views on our new Prime Minister Narendra Modi?
He obviously has struck an incredibly inspirational chord in the country and of course the fact that he has the Baroda connection like I do, is very gratifying. I would love to meet him and see if we can help in his mission in some way. We have a great opportunity to help change the world and we would miss the point if we didn't do something for India.
ET: Who do you consider biggest influence in your life?
I always admired, growing up, Albert Einstein. My dad and my mom obviously. My dad was an engineer in the Railways here and an incredible man. My wife is a hero of mine. She is a huge influence in my life and what she has done in our family and things that she has overcome. But from the outside, scientists have been my influences --Einstein, Kurt Godel, Erwin Schrodinger.
ET : You have a particular affinity for mathematics obviously.
Yes. You could say that. The great computer scientist John Mccarthy was on my PhD exam committee. He is one of the fathers of artificial intelligence. Marvin Minsky wrote a recommendation for me. Alan Kay has been a great teacher of my life. He was one of the biggest influences in my life. So many people like this. Steve Jobs was an incredible builder of innovation.
ET: Any mathematical problem that you could not solve that Murthy gave you?
We haven’t solved, quite solved, the Infosys growth problem yet. This is a very big problem that he has given me. The big one is yet to come.
ET: Would you like to leave Infosys as a truly global company?
But still, one with an Indian heart and Indian.. Dil hai Hindustani. That was a song right. Phir bhi dil hai Hindustani. Hum hai multinational, phir bhi dil hai Hindustani.
ET: What was the last movie you watched?
Oh my God. Should I admit this? Mere Dad ki Maruti. I loved that movie. That was a hilarious movie. My son loves that one and he has seen it three four times. It reflects on itself, it makes fun of itself. Nice movie.