Strategy Management of Infosys Prepared By : 01 : Dharmista Baria 02 : Kushal Bhagat 03 : Dipak Bhayani Submitted To : ( Group : 1 ) Prof . Hiren Patel

History Infosys was founded on July 2, 1981 in Pune by N. R. Narayana Murthy and six others: Nandan Nilekani, N. S. Raghavan, Kris Gopalakrishnan, S. D. Shibulal, K. Dinesh and Ashok Arora, with N. S. Raghavan officially being the first employee of the company. Murthy started the company by borrowing INR 10,000 from his wife Sudha Murthy. The company was incorporated as "Infosys Consultants Pvt Ltd.", with Raghavan's house in Model Colony, north-central Puneas the registered office.

Infosys went public in 1993. Interestingly, Infosys IPO was undersubscribed but it was "bailed out" by US investment banker Morgan Stanley which picked up 13% of equity at the offer price of Rs. 95 per share. The share price surged to Rs. 8,100 by 1999 making it the costliest share on the market at the time. Infosys was among the 20 biggest companies by market capitalization Established in 1981, Infosys is a NASDAQ listed global consulting and IT services company with more than 103,000 employees. From a capital of US$ 250, it’s grown to become a US$ 4 billion company with a market capitalization of approximately US$ 14 billion.

Milestone Year Detail 1981 Infosys is established by N. R. Narayana Murthy and six engineers in Pune, India, with an initial capital of US$ 250 . Signs up its first client, Data Basics Corporation, in New York 1983 Relocates corporate headquarters to Bangalore 1987 Opens first international office in Boston, US 1993 Introduces Employee Stock Options (ESOP) program , Acquires ISO 9001/TickIT certification

Year Detail 1994 Moves corporate headquarters to Electronics City, Bangalore. Opens a Development Center at Fremont 1995 Opens first European office in the UK and Global Development Centers at Toronto and Mangalore. Sets up e- Business practice 1996 The Infosys Foundation is established 1997 Opens an office in Toronto, Canada 1998 Starts enterprise solutions (packaged applications) practice 1999 Listed on NASDAQ Opens offices in Germany, Sweden, Belgium, Australia Infosys Business Consulting Services is launched

Year Detail 2000 Re-launches Banks 2000, the universal banking solution 2001 N. R. Narayana Murthy is rated among Time Magazine/CNN's 25 most influential businessmen in the world Opens offices in UAE and Argentina, and a Development Center in Japan 2002 Nandan M. Nilekani takes over as CEO from N.R. Narayana Murthy, who is appointed Chairman and Chief Mentor 2003 Expands operations in Pune and China 2004 Revenues reach US$ 1 billion , Infosys Consulting Inc. is launched 2005 Records the largest international equity offering of US$ 1 billion from India

Year Detail 2006 Infosys celebrates 25 years. Revenues : US$ 2 billion. Emplo grow to 50,000+ N. R. Narayana Murthy continues as Chairman and Chief Mentor of Infosys 2007 Kris Gopalakrishnan, COO, takes over as CEO. Nandan M. Nilekani is appointed Co-Chairman of the Board of Directors 2008 Infosys crosses revenues of US$ $ 4.18 billion. Employees grow to over 90,000+ Reports Q4 revenue of US$ 1,142 million

What Infosys are Vision "To be a globally respected corporation that provides best-of-breed business solutions, leveraging technology, delivered by best-in-class people.“ Mission "To achieve our objectives in an environment of fairness, honesty, and courtesy towards our clients, employees, vendors and society at large.“ Values infosys believe that the softest pillow is a clear conscience. The values that drive us underscore our commitment to: Customer Delight Pursuit of Excellence: Fairness: Integrity and Transparency:

Members of the Board 1 2 3 4 5 6 7 8 9 10 11 12 S.No Name Designation Mr. N R Narayana Murthy Chairman & Chief Mentor 2 Mr. S Gopalakrishnan Managing Director & CEO 3 Mr. Kundapur Vaman Kamath Additional Director 4 Mr. K Dinesh Director 5 Mr. T V Mohandas Pai 6 Mr. Srinath Batni 7 Mr. S D Shibulal Director & COO 8 Mr. David L Boyles Independent Director 9 Mr. Claude Smadja 10 Mr. Deepak M Satwalekar 11 Mr. Sridar A Iyengar 12 Prof. Jeffrey S Lehman

Infosys Business Lines Insurance Healthcare Insurance Banking & Capital Market Communication Media & Entertainment Energy ,Utility, and Services Manufacturing (MFG) New Market & services (NMS) aus,china,maxico Indian Business Unit Infosys BPO Infosys China Infosys Australia Infosys Mexico Consulting Solutions ( CS ) Enterprise Solutions (ES) Product Engineering & Validation Services ( PEVS) Infrastructure Management Services (IMS) S/w Engineering & Technology Labs ( SET Labs) System integration Services (SI) Corporate Sales & Marketing ( CSM ) Infosys Leadership Institute Tech Services Information Systems(IS) Quality Human Resource Education & Research ( E & R) Security Audit & Architecture ( SA & A)

Infosys other Business or Focus Areas : Arts & Culture Environment Healthcare & Education Diversity Talent

Infosys alliance partners Microsoft Oracle IBM HP Mantas Sun Microsystems Siemens TIBCO Software Inc.

Achievement & Awards Infosys was ranked among the top 50 most respected companies in the world by Reputation Institute’s Global Reputation Pulse 2009. Infosys won Sears Holding Corporation's Partners in Progress award for the second consecutive year.

Conti….. also won HDS' Diamond Award for 'Best Virtualization Strategy' and Platinum Award for 'Best Green Strategy for a Data Center'. Infosys was also listed in the Most Admired Knowledge Enterprises (MAKE) 2008 study and Forbes' Asian Fabulous 50for the fourth consecutive year. Infosys were ranked among 'India's Best Companies to Work For - 2009' in a survey by the Great Place to Work® Institute and conferred with the NASSCOM gender inclusivity award. Asset magazine acclaimed their Corporate Governance, acknowledging their corporate policies and practices as amongst the best in the industry

Share Holding Pattern as on :  30/06/2009   31/03/2009 Face Value  5.00 No. Of Shares % Holding Indian Promoters  94484978  16.49 Sub Total Mutual Funds and UTI  23826059  4.16  20519719  3.58 Banks Fin. Inst. And Insurance  23671621  4.13  23801421 FII's  204337813  35.66  199664124  34.86  251835493  43.95  243985264  42.59 Private Corporate Bodies  22579774  3.94  20085568  3.51 NRI's/OCB's/Foreign Others  4956706  0.86  5105579  0.89 Others  107579021  18.77  112433187  19.63  135115501  23.58  137624334  24.03 General Public  91623205  15.99  96735467  16.89 GRAND TOTAL  573059177 100.00  572830043

SWOT ANALYSIS STRENGTHS Leadership in sophisticated solutions that enable clients to optimize the efficiency of their business Proven “Global delivery model” Commitment to superior quality and process execution Strong Brand and Long-Standing Client Relationships Status as an employer of choice Ability to scale Innovation and leadership

WEAKNESSES Excessive dependence on US for revenues – 67 % of revenues from USA Excessive dependence on BFSI sector for revenues – 36 % of revenues from BFSI Weak player in domestic market. Only 1 % of revenues from India – low as compared to peers Low R & D spending as compared to global IT companies – only 1.3 % of total revenues Rising wage bill – 42.9 % to 44.8 % of revenues Low expertise in high end services like Consultancy and KPO.

OPPORTUNITIES Domestic market set to grow by 20%. Expanding into new geographies – Europe, Middle East, etc Infosys is cash rich (Around US $ 1 Billion) - Acquiring companies to increase expertise in Consultancy, KPO and package implementation capabilities Opening offices and development centers in cost advantage countries such as those in Latin America and Eastern Europe.

THREATS The economic environment, pricing pressure and rising wages in India and overseas Intense competition in the market for technology services could affect cost advantages. High dependency on a small number of clients, and the loss of any one of the major clients could significantly impact business. Failure to complete fixed-price, fixed-time frame contracts within budget and on time Currency fluctuations Termination of Client contracts can typically be terminated without cause and with little or no notice or penalty.

Infosys Technologies Ltd. Exchange : BSE Price Date Open Price High Price Low Price Close Price Traded Value Number Of Trades Traded Quantity 18-08-2009 1974.95 1999 1957 1971.4 286530395 4893 145082 19-08-2009 1985 1988 1936 1950.7 294247192 4500 150657 20-08-2009 1970.4 1995 1955.05 1992.8 436096086 2765 219033 21-08-2009 1993.05 2036.15 1972 2028.5 467097546 6106 232789 24-08-2009 2041 2082.4 2076.15 239367684 4260 115593 25-08-2009 2068 2104 2096.1 315131286 5213 151542 26-08-2009 2105 2188 2098 2181.35 552460578 10578 254324 27-08-2009 2180 2202.7 2121.2 2189.75 429541769 8293 196202 28-08-2009 2185 2199 2142.5 2187.65 292890893 4962 135164 31-08-2009 2168 2125 2132.3 158274398 3984 74118 1/9/2009 2139.8 2189.7 2122.35 2142.65 289677971 5179 134253 2/9/2009 2130 2178 2127.15 2165.2 169665967 3814 78518 3/9/2009 2170.05 2200 2135.15 2188.2 294037988 6565 134792 4/9/2009 2214.9 2138.2 2200.35 284593894 5692 129759 7/9/2009 2210 2228 2195.35 2223.4 254502629 5444 114842 8/9/2009 2187 2235 2200.05 232736189 5028 105487 9/9/2009 2216.9 2193.1 302283977 4791 137665 10/9/2009 2206 2248.05 2202.35 2235.1 277498885 5430 124430 11/9/2009 2250.25 2271.9 2245.05 2266 319907854 6143 141607 14-09-2009 2245 2259.9 2240.6 2250.55 254252064 2658 113047 15-09-2009 2250.2 2275 2240.05 2270.05 348201180 4662 153897 16-09-2009 2282.5 2324.4 2273.4 2317.65 517899710 6413 225847 17-09-2009 2327 2367 2320.05 2360.9 344181449 6488 146482 18-09-2009 2370.1 2388 2350 2363.8 201441644 4147 85038 22-09-2009 2414.7 2341 2405.6 330737778 5630 138008 23-09-2009 2405 2360 2365.55 193383638 3661 81310 24-09-2009 2349.7 2261.5 2285.1 760359269 10978 333740 25-09-2009 2252 2245.3 400141745 7581 177821

Stock Exchange :BSE IN Rs Date : 26-8-09 to 25-9-09

Infosys Technologies Ltd. Exchange : NASDAQ Price Date Open Price High Price Low Price Close Price Traded Quantity 18-08-2009 40.51 41.04 40.17 40.88 1929100 19-08-2009 40.32 41.2 40 41.05 1610700 20-08-2009 41.22 41.27 40.31 2002200 21-08-2009 41.61 42.49 42.25 1843000 24-08-2009 42.9 42.98 42.13 42.36 1427100 25-08-2009 42.63 43.1 42.52 43.08 1650300 26-08-2009 44.41 45.22 43.92 44.21 2467300 27-08-2009 44.51 44.89 43.84 44.82 1935000 28-08-2009 44.71 45.13 44.23 2243600 31-08-2009 43.53 43.83 42.82 43.23 2332000 1/9/2009 43.38 44.45 42.92 43.13 2368900 2/9/2009 43.77 44.08 43.42 43.43 1352000 3/9/2009 44.19 44.64 43.91 44.34 1488400 4/9/2009 44.65 45.05 44.47 44.91 1381800 8/9/2009 45.37 46.03 45.1 1437200 9/9/2009 46.04 46.96 45.76 46.85 3306000 10/9/2009 46.42 47.42 46.35 47.21 2693900 11/9/2009 47.41 46.64 46.78 2132400 14-09-2009 46.18 46.45 1466600 15-09-2009 46.79 47.27 46.6 47.14 1215200 16-09-2009 47.97 48.64 47.32 48.55 1993900 17-09-2009 48.86 49.68 48.65 49.16 2057400 18-09-2009 49.3 49.45 48.62 48.68 1430600 21-09-2009 48.23 49.4 48.12 48.97 748400 22-09-2009 49.64 50.1 49.15 49.29 2654800 23-09-2009 48.93 49.2 48.5 48.52 2406000 24-09-2009 47.95 48.41 47.07 47.12 2954200

Stock Exchange :NASDAQ IN $ Date : 26-8-09 to 24-9-09

ANALYSIS OF STRATEGIES Corporate level strategies: Core Strategies: Firm believer in “Organic growth” and acquire only those companies in line with strategic goals. Global Delivery Model – Producing where it is most cost effective to produce & selling where it is most profitable to sell. Moving up the Value Chain – Getting involved in a software development project at the earliest stage of its life cycle. PSPD Model – “Predictability of Revenues, Sustainability of Revenues, Profitability, De-risking” for risk management.

Actions Taken by Infosys: 1. To maintain low-cost advantage they have opened offices in Czech Republic, Mauritius, Poland, Philippines, Thailand and Mexico. 2. Invested in developing training centers – 3. Improved quality capabilities – CMM level 5i company. 4. Infosys Consultancy established to provide high end services in value chain. 5. Has hedged currency for more predictability of revenues (risk management).

GENERIC STRATEGIES: 1. Low cost Global delivery 24/7 Model. 2. Little differentiation in low-end services of value chain; high differentiation in high end services of value chain like software products and package solutions. 3. Focus on quality, customer relationship management, timely-delivery.

GRAND STRATEGIES: Ansoff’s Matrix:

MARKET DEVELOPMENT STRATEGY: MARKET PENETRATION STRATEGY: Current Markets: USA and Europe Current Products: ADM, BPO, KPO, consultancy services (in BFSI, manufacturing and retail) and software products (financial products). Recommendation: As most large clients in US and Europe are cutting costs, Infosys needs to be more aggressive on cost and quality front. Result of strategy: Unlikely to yield good results MARKET DEVELOPMENT STRATEGY: New Market: India, Middle-east and Australia Current Product: BPO, KPO, consultancy services (in BFSI, manufacturing and retail) and software products (financial products). Recommendation: Since these are fast developing IT market, Infosys needs a paradigm shift in focus from US and EU markets to these markets. Result of strategy: Likely to yield good result.

PRODUCT DEVELOPMENT STRATEGY: Current Market: USA and Europe New Product: Consultancy and package implementation services in relatively growing sectors esp. healthcare, life sciences and aviation sector, and KPO services. Recommendation: Concentrate on building expertise in these domains by strategic acquisitions. Result of Strategy: Likely to have good result. (better the company acquired, the better the result).

DIVERSIFICATION: New Market: India, Middle-east and Australia New product: Consultancy and package implementation services in relatively growing sectors esp. healthcare, life sciences and aviation sector, and KPO services. Recommendation: Changing Brand image from low value service provider to high value service provider. Result of Strategy: Difficult to achieve overnight (possible in long term)

OTHER STRATEGIES: CONCENTRATION: VERTICAL INTEGRATION: 90% of Infosys revenues from American and European nations. VERTICAL INTEGRATION: Infosys recently made a bid to acquire a European major – Axon consultancy to improve its business in European markets, but finally called off the deal due to high valuation. Otherwise, Infosys has always believed in organic growth. INNOVATION: The Software Engineering and Technology Labs (SETLabs) at Infosys is the center for applied technology research in software engineering and enterprise technology. SETLabs conducted 24 Innovation Workshops with customers from the US and Australia, to identify research collaboration possibilities. Infosys promotes a favorable work environment that encourages innovation and meritocracy.