Narayana Murthy and Infosys

Introduction Contd...

Infosys was the first company to push for off–shore software development³ as against body shopping⁴ that was coming during the 1980s. He championed corporate governance in India. Infosys was the first Indian company to follow the US Generally Accepted Accounting Principles (GAAP) disclosure norms before going for a Nasdaq listing in 1999. Narayana Murthy was also the recipient of many awards (Refer Exhibit I). In late 2000, Infosys became a total software services company. It had set up a software development centre at Toronto as part its globalization strategy. Analysts felt that Narayana Murthy had not only managed his company well, he talked about the company at every opportunity that came his way. In the process, he had built brand equity for his company.

Background Note

Narayana Murthy obtained his Bachelor's degree in Electrical Engineering from University of Mysore in 1967 and his Master's degree in Technology from Indian Institute of Technology, Kanpur in 1969. He started his career as head of the computer centre at IIM, Ahmedabad. In 1972, he went to Paris where he was part of the team that designed a 400-terminal, real-time operating system for handling air cargo for Charles De Gaulle airport. Narayana Murthy was a left-wing activist and mingled with French communists during his stay in Paris but his outlook changed while traveling around Europe. He believed that the only way to pull India out of poverty was to create more jobs, by setting up new companies.

In 1975, he returned to India and joined Systems Research Institute, Pune, (Maharashtra). He then headed Patni Computer Systems Pvt. Ltd., Mumbai, (Maharashtra) before founding Infosys in 1981, along with six other professionals.

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3] Due to low hourly rates and technically well-trained programmers, the European and American organizations have their major software development projects done in less developed countries like India.

4] Body shopping is contract labor of skilled workers. It refers to the practice of recruiting software professionals in India and sending them to work on projects abroad.

Case Details

Case Code : LDEN003
Themes: Corporate Social Responsibility, Great Leaders
Case Length : 8 Pages
Period : 1981-2001
Organization : Infosys
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Software

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