Infosys Technologies, Limited 297Copyright © 2005, Idea Group Inc. Copying or distributing in print or electronic forms without writtenaged to assemble diverse teams to execute projects. On large global projects,
employees from different cultures in different offices around the world were asked
to propose, win, and execute those projects on collaborative basis.- Wealth creation and wealth sharing: Unlike its competitors, Infosys started
offering stock options to its employees. It renounced the practice of signing
employment bonds with its professionals going abroad, and started offering higher
education opportunities to its employees in foreign universities. Murthy summa-
rized these policies: “We realized that we had to make a value proposition to our
people, as we did for our customers.”
It took Infosys over four years to fully implement these components of the new
human resource strategy. By 1996, Infosys had a perceptible edge over its competitors
— employee turnover was at an industry low of 10% and people reported a feeling of pride
in working with Infosys.
Continuous Innovation
Murthy was of the opinion that a scalable company could not be built with static
processes. “Ensuring innovative processes enables an evolutionary architecture,” he
said. In 1992, Infosys launched the Excellence Initiative to brace the software develop-
ment and delivery processes. The excellence statement declared: “A commitment to
strive relentlessly, to constantly improve ourselves, our services and products so as to
become the best.” The initiative had a strong focus on quality and innovation. Over the
years, supply chain was tightened using Baldrige’s seven criteria, international stan-
dards such as Six-Sigma and ISO 9001 were achieved. By 1997, CMM Level 4 was attained,
and preparations began to attain CMM Level 5.
By 1999, Murthy had started planning a change in leadership, and wanted the then
chief operating officer (COO), Nandan Nilekani, to take over as the CEO. As a part of his
mentoring plan for Nandan, he assigned him the responsibility to develop the infrastruc-
ture for CMM Level 5, which included building a robust system to continuously improve
the software development and delivery processes. Nandan, a product of the Indian
Institutes of Technology, approached this issue with a purely technical perspective.
With an inkling that system requirements for CMM Level 5 will include steady knowledge
inputs, he thought of implementing a small knowledge-based system to facilitate
knowledge flows to the operations improvement group — the team governing process
innovation within Infosys. He held discussions in this regard with employees at various
levels, and was surprised at the results — knowledge flow was more than just a
requirement for CMM Level 5; it was also the bane of a different problem of
mammoth proportions. Virtually everyone, from software developers to sales
managers, complained about the acute lack of knowledge inputs even in their day-
to-day operations. Highly trained professionals asked Nandan, “Given the knowl-
edge-related constraints, how do you expect us to attain the corporate objective
of continuous innovation?”
The Need Intensifies
Nandan continued to probe this issue further. He remembered, “I got a feeling of
a huge knowledge void, as if Infosys was fast becoming opaque to any kind of knowledge