Mumbai, Feb. 19: Infosys executive chairman N.R. Naryana Murthy has said he is ready to axe high-salaried non-performers at the premier technology giant who aren’t bringing any value to the company.
Sending out a strong message to non-performers at the company, Murthy said individuals who did not “add value despite high salaries” may be asked to leave.
Eight senior executives, including head of American operation Ashok Vemuri and BPO operations chief V. Balakrishnan, have left the company in the six months since Murthy came out of retirement to head the company.
Other high-profile exits include Subrahmanyam Goparaju, senior vice-president and a member of the executive council; Stephen R. Pratt, who co-founded Infosys consulting; and Basab Pradhan, head of global sales.
But Murthy said he wasn’t worried about the departures.
“One of my tasks was to ensure that the identified people who were receiving very high salaries but were not contributing as much as we wanted were either given opportunities to add value to the company or they could seek opportunities elsewhere,” he told analysts at the Bank of America Merrill Lynch India Investor Conference here today.
“Performance is absolutely essential for us. We will provide all the help to people to perform better and if for any reason they are not able to perform, well then, we will have to bid goodbye to them,” Murthy said.
“Barring some rare exceptions, there was nobody who was adding value to the company who had to leave. That’s the reality. Unfortunately, these were the people who were deriving very high salaries and were not giving results and so there was no growth,” the Infosys executive chairman added.
Murthy was forced to return after the Rs 42,000-crore software giant started stumbling on its revenue guidance and profits. He said he was focused on bringing about a certain level of cost optimisation of the company.
“Our costs have ballooned very rapidly in the last 2-3 years. For example, on-site compensation was 36 per cent of the overall revenue in 2010-11 and it went up to 46.3 per cent in 2012-13. A part of it was because we hired people at high salaries outside India and these people did not add value to the company,” he said.
The Infosys chairman said the company would have a new CEO by March 2015 when co-founder and present CEO S. D. Shibulal retires. “I will be available for him to ensure that there is a proper transition,” he added.
Murthy also assured analysts that the company was undertaking various initiatives to increase employee productivity and would continue to focus on reducing on-site costs by shifting more work offshore.
“Our desire is that Infosys should get back to industry leading growth rates. What that growth rate will be is something that we will tell you as we move forward,” he said.