Narayana Murthy unlocks his success mantras

N R Narayana Murthy, the legendary brain behind Infosys, tells how the idea of Infosys was evolved, how he became a capitalist and what you should do to become a successful entrepreneur

What is that one moment that made you think of starting Infosys?

Anil Rao, e-mail: anilrao@aol.in

In 1974, when I was holed up in a small 8 x 8 ft. room in a railway station at Nis, a border town between what was the then Yugoslavia (currently Serbia) and Bulgaria. I realized that the best solution for countries like India to solve the problem of poverty was entrepreneurship and capitalism. I realized how communist rule punished its citizens without reason and just based on biases.

I still remember the words of the guards at the railway station who released me after 3.5 days of detention that I was from a friendly country called India and that was why they were letting me go! Then I got on to the train, a goods train, going from Nis to Istanbul. It was a 21-hour journey, and I had not eaten for 5-6 days before that. Throughout the journey, I was mulling over this injustice, the system of communism, and the problem of poverty in India. That is when I decided to become an entrepreneur and a capitalist. I had read a little about various economic philosophies by then and realized that the only way countries like India could overcome poverty was through the creation of jobs, which required entrepreneurship.

How did you select your co-founders? And what was each one's role in building Infosys?

Alex, e-mail: alex.p@yahoo.co.in

Ans: My colleagues were very young with hardly a year or two of experience in software engineering. Therefore, I selected people on the basis of compatibility of values. Nandan Nilekani, N. S. Raghavan, Kris Gopalakrishnan, S. D. Shibulal, K Dinesh, and Ashok Arora had a very similar value system. They were all from the middle class and they believed in deferred gratification. They were ready to run the business honestly and ethically; they were ready to work very hard; and they were satisfied with very low salaries in the beginning.

Even today, our salaries are the lowest in the industry. They believed in team spirit. Team spirit is about making sure the other persons in the team do not fail. They brought complementary values. For example, Raghavan was the people's person. He looked like he understood human resources. Nandan looked like he was a sales-oriented person, I thought I knew a bit of strategy and finance, Kris liked technology. Shibulal and Dinesh seemed like good project managers. Ashok Arora was a fine designer.

Who selected the name Infosys and on what basis was it chosen?

Tinu George, e-mail: Tinu.George@gmail.com

Ans: When we decided to start the company on December 29, 1980, I chose Mr. NS Raghavan, Mr. Kris Gopalakrishnan, and Mr. Nandan Nilekani to work with me. I asked them to think of a name. Generally, I am a very impatient person. So, I told them that they had to come back to me with a name in 48 hours else I would choose a name. For some reason, they did not come back with a name. Therefore, I chose the name 'Infosys' because we wanted to be in the business of designing information systems. So, Infosys is an acronym for information systems.

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What did you intend to achieve with the founding of Infosys and in how many years after the founding, do you think, you achieved what you intended?

Gowda Suman, e-mail: gowda.suman@nss.com

Ans: I don't think we have yet achieved what we wanted to achieve. There were several objectives. First, I wanted to demonstrate that it was possible to run a legal and ethical business in India. By and large, we have done that. I wanted to conduct an experiment in the democratization of wealth. We gave ESOPs to our people. In that sense, we have achieved what we wanted to achieve. We wanted to benchmark ourselves on a global scale in quality and productivity. We have achieved that as well. We wanted Infosys to be a truly multi-cultural organization. We wanted the company to be a place where people from different nationalities, races, and religions would come together and work in an environment of intense competition but at most courtesy and dignity. We have a lot more work to do in this dimension.

During your initial days of founding, did you ever think of quitting or selling Infosys?

Sadhana Hegde

Ans: In 1990, there was an offer to buy out Infosys for $1 million. Everybody got excited and we held a meeting on a Saturday morning in our Jayanagar office. In that meeting, I let my colleagues speak first. When my turn came, I said, “No, I will buy you people out.” They were a little bit surprised because they knew I did not have the money. I said we were going through difficult days but I was confident that we would overcome the problems. We had already spent nine years in this marathon. Therefore, I said, it would not be a good idea to sell it off for just a million dollars, though I did not think that a million dollars was a small sum at that time. Within 10 minutes, Nandan came on to my side and said he would be with me. Within half an hour, others followed suit. That is how we averted that sell-off attempt.

How difficult or easy it is to start another Infosys in today's condition compared to 30 years back when you founded Infosys?

Sampath Kumar, email: sampath_kumar_1978@yahoo.co.in

Ans: Well, starting yet another vanilla type software services company is not easy. Because, the bigger companies have built lots of entry barriers. Today, we own 26 million square feet of office space just in India. We have offices in 70 countries. We have 110,000 people. We have about Rs 17,000 crore of cash. We are connected with many influential people in well-known corporations because we are on the boards of various international companies. We have invested heavily in quality, productivity, branding and technology. We have SETLabs (Software Engineering and Technology Laboratories). It works with 10 well known universities in India and abroad. We have world's largest corporate training center. We have 600 faculty members dedicated for training. We have a 29-week-long training program for every engineer. We have 10,300 hostel rooms in our training center in Mysore. No global or Indian competitor has these facilities. We have a huge human resource department which can process 10,000 applications a day.

The point I am trying to make is that if somebody else wants to do something on the lines of what we do or what TCS or Wipro or Cognizant does, it is going to be difficult. The youngsters have tremendous opportunities if they think of a different paradigm or a different business model. While there is tremendous opportunity in other areas, doing, today, what Infosys did 30 years ago is not going to be that easy.

Could you share your first breakthrough moment?

Ans: When we started Infosys, we spoke to a US software company called Data Basics Corporation. During my stint at Patni Software, we had worked with this company. Data Basics Corporation had started their operations in SEEPZ, Mumbai when I met the CEO of Data Basics Corporation. I convinced him that it was much better for him to close down his own operation and work with us. Since he had worked with us earlier, he knew our competence and value system, and the difficulties of operating out of India at that time. So, he closed his operation down and started working with us. That was the first breakthrough.

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Had your wife been the CEO of Infosys instead of you, how would have your company shaped up? 

Somasegar, email: Som@micrsoft.com

She is a much better manager and a better leader than I am. She is much more disciplined than I am. So, it is likely that we would have been more successful. But these kinds of hypothetical questions are very difficult to answer. It would depend on the team she would have put together and on the market conditions outside. It would also depend on the ideas she would have chosen. She is better at getting along with people too.

Why did Infosys not utilize its brand reputation and cash reserve to enter other businesses?

Soleswaran

Ans. We are software professionals. We enjoy doing what we do. And there are lots of opportunities in this area. We are all busy doing what we enjoy. Even though I am retired, I come to this office regularly. I don't get salary. But I come because I enjoy coming to the office. We are quite happy with what we are doing.

How will Infosys shape up by 2025?

Kadur Srinivas, email: srinikadur@yahoo.co.in

Ans.It is very difficult to say what Infosys will be in the next 15 to 16 years. If you had asked me in 1995 whether we would be a $6 billion corporation by 2010 or 2011, I wouldn't have been able to answer. All I can say is that we want Infosys to be a corporation where people of different nationality, races and religions will come together and work in an environment of intense competition but at most courtesy and dignity to add greater and greater value to the customer day after day. Whether we will be a $50 billion corporation or $100 billion corporation in the future... I don't know.

Is an MBA or engineering degree necessary to become a successful entrepreneur?

Kavitha Murthy, email: kavi1980@yahoo.co.in

Ans. No, I don't think any specific educational background is required. What is required is a good idea that has value to the market, a team with complementary skills and a good value system, and a market which is ready to pay for that idea. And, of course, you need some money in the beginning. That is not very critical, though. However, if you want to be in a specialized area, then it is better to have expertise in that particular area. Like medical electronics, where, bringing together doctors and engineers is a good idea. It is not necessary to have an MBA to become a successful entrepreneur. MBA will help but it is not mandatory.