Infosys Technologies, Limited 291Copyright © 2005, Idea Group Inc. Copying or distributing in print or electronic forms without written(commitment to earn trust and respect), and Pursuit of Excellence (commitment to
constantly improve oneself). These values were echoed in company’s vision statement:
“We will be a globally respected corporation that provides best-of-breed business
solutions leveraging technology delivered by best-in-class people.”
Murthy’s value-driven entrepreneurial paradigm, impeccable corporate gover-
nance record, and Infosys’s outstanding financial performance won him the Ernst &
Young World Entrepreneur of the Year Award for 2003. He and the current CEO and
managing director, Nandan Nilekani, were also declared by Fortune as Asia’s Business-
men of the Year 2002-2003.
Robust Growth
Things changed dramatically for Infosys in the early 1990s. The economic reforms
declared by the Indian government brought a new lease of life to the Indian software
industry. Infosys was among the first to ride the wave of resulting opportunities. Strong
performance buttressed with planned growth brought impressive results. By 1999, the
company had floated a successful public issue in India and the United States, thus
becoming the first Indian firm to be listed on NASDAQ. Exhibit 1 summarizes the
performance of company’s stock over the past few years. The company also topped $100
million in annual revenues, 90% of which came from the IT and business consulting
services to Fortune 1000 firms. Exhibit 2 charts company’s revenue growth over the years.
By 2003, Infosys employed over 21,000 people scattered over 30 offices and
development centers (DC) in 17 countries. With a market capitalization of $10 billion, and
2002–2003 profits of $245 million, Infosys emerged as the second largest IT company in
India. The company had grown at a compounded annual growth rate of 70%. Exhibit 3
traces Infosys’s corporate journey over the past 23 years. During these two decades,
Infosys had a number of firsts to its credit. It was the first Indian company to offer stock
options to its employees. It became the first Indian company to include the assessment
of intangible assets in its financial results, which it declared in accordance with the
accounting principles of seven countries. Exhibits 4a, 4b, and 4c show Infosys’s selected
financial results per the U.S. GAAP and the Intangible Assets Score Sheet, respectively.
It was also the first Indian company to win Asia’s Most Admired Knowledge Enterprise
(MAKE) award in 2002 and 2003 and the Global MAKE award in 2003.
From Software Services to IT Consulting
Infosys gradually evolved from an offshore software service provider to an IT and
business consulting firm. Murthy remembered, “We wanted to expand our portfolio of
services and were developing the skills to do more of consulting. We built a team of
around 300 business consultants and also started a business process outsourcing arm.”
The expansion was carefully planned and timely executed across five core domains:
software development, software maintenance, software reengineering, Y2K technolo-
gies, and ERP and e-commerce systems. Exhibit 5 highlights the past two years’ revenue
contribution in terms of the service offering.
Software Development: Infosys started with providing piecemeal solutions to small
IT-related problems of their clients. Over the years, as its processes matured and its
project management skills improved, it started offering comprehensive software solu-
tions for all the IT needs of its customers. The fixed-price tag, fixed-time frame, and