1. Living up to the promise
S. Gopalakrishnan
© 2002 Infosys Technologies Limited

2. Agenda Promises made, promises kept A picture of the future…
Growth and profitability
Moving up the value chain
Expanding the service footprint
Executing new services uniquely
Presenting a one-stop-shop face to clients
A picture of the future…
Market opportunities
Organizational responses
© 2002 Infosys Technologies Limited

3. Profitable revenue growth
Economic Slowdown
CAGR = 57%
* Excluding one-time stock compensation charge
© 2002 Infosys Technologies Limited

4. Understanding where the profits come from Data from Q1 FY 2002-03
Onsite revenue 49
Onsite salaries 32
Other income 3
Tax 6
Optg. Margin 30%
Gross Margin 46%
Net Income 27%
Offshore revenue 51
Other operating costs 16
S&M 7
G&A 8
ESOP Charge 1
Other direct 13
Depreciation 5
Software 2
Other direct 6
Offshore salaries 9
© 2002 Infosys Technologies Limited

5. Moving up the value chain
Prime Partner Status
Enterprise Architecture Definition
Enterprise Solutions
Technology-enabled BPR
Integrated Business-IT Roadmap
2001
ITO SI
BPO
App.
Dev.
Maintenance
Re-engineering
New services have expanded the addressable market by 3X
© 2002 Infosys Technologies Limited

6. Systematic expansion of footprint
A proven, defined methodology for introduction of new services
New services are delivered uniquely
Alliances as a critical way to “stick to the knitting” while presenting unified end-to-end face
Alliance partners are best in class, a true win-win relationship model
Concentrate on what we do well
Aggressively use global delivery for win-win benefits
High quality client interface team presents these services in an integrated fashion
© 2002 Infosys Technologies Limited

7. As a result, we have a unique position in the marketplace
Organizational Value Add / Employee
Strategy, consulting
What?
Why?
INFOSYS – proven GDM
Specialty IT services
How ?
Global Majors – new or no GDM
Generic project management
Most Offshore players
Implement Support
Staffing Services
Source : Butler Group, Infosys
© 2002 Infosys Technologies Limited

8. A glimpse into the future…
Market conditions
Vendor consolidation – fewer, end-to-end service providers
Large deals
Outsourcing becoming ubiquitous – changing role of the CIO and his / her team
Global Delivery is a necessary condition
Managing risk (perceived and actual) is key
© 2002 Infosys Technologies Limited

9. …and our response… Moving towards becoming an end-to-end player
Creating a “large deal” cross-functional team for such opportunities
Working closely with outsourcing consultants to build consensus for and thought leadership in outsourcing
This also enables “sole-sourcing”
Aggressively leveraging GDM in all activities
Strong brand and financial stability reduces risk
© 2002 Infosys Technologies Limited

10. Summary : Industry Convergence Who will win the race to the finish line?
Infosys :
Talent magnet
High quality execution
Perfected Global Delivery Model
“Customer first” culture
Lean Orgn.
Global Majors :
Deep, hi-level client relationships
Readymade solution-sets
Consulting mind-set
Full set of services
On-shore investments
Brand building
Education and training
Consulting mind-set
Full-line of services
On-shore hiring
So we see convergence in this industry – while on the one hand you have, Infosys, an established Talent Magnet with High Quality Execution using the Global Delivery model, a “Customer First” culture and a lean cost structure. Infosys will have to make on-shore investments from its big cash hoard in sales and marketing / brand building, education and training in giving its employees a “consulting” mind-set and introduce services to offer a full line. It might also have to hire on-shore for building hi level relationships with clients / front-end work.
On the other hand, Global Majors will have to move to a leaner organization which use global delivery extensively.
Who will make the transition more easily? A lean and mean 10,000 employee organization or a fat and heavy 80,000 employee organization. I leave it for you to decide.
Offshore investments
Reduce fat / shift C.G.
Re-allocate resources
Invest in processes
Resolve orgn. issues
Resolve bill-rate redn.
© 2002 Infosys Technologies Limited

11. Thank You
© 2002 Infosys Technologies Limited