Infosys Technologies Case Study
Infosys Technologies • • •
Adam Bilzerian Robert Drysdale David Centellas
Agenda • • • • •
Infosys and India’s Background Business Process Outsourcing Infosys Stretch Strategy Infosys Business Model Infosys Today
India • • • • •
English is widely spoken Hi hl educated Highly d t d populace l Time zone difference IT clusters l t Heavily regulated environment until 1991
Infosys • • • •
Infosys founded 1981 Infosys capital is its people Ethical business practices Honest Integrit Honesty, Integrity, Fairness, Fairness and Respect. • BPO requires trust trust, which Infosys displays in all aspects of the way it conducts business
Business Process Outsourcing (BPO) • •
•
BPO is the process of hiring a third party to handle specific business activities for you. “BPO is distinct from information technology (IT) outsourcing, which focuses on hiring a third-party company or service provider to do ITrelated activities, such as application management g and application development, data center operations, or testing and quality assurance.”(sourcing mag.com) Started to g grow in p popularity p y in the 70’s when it was limited to p payroll y functions primarily. Now everything non-core from Human resource functions to accounting functions are outsourced.
St t i Applications Strategic A li ti • • • • • •
Low cost, highly educated workers Increase network into different time zones and cultures New knowledge network and a different perspective on strategy Lack of available skilled labour in companies home base Can hedge risk if Outsource partner will guarantee contract Negatives– Have to trust strategic outsourcing partner – Give up some control on quality and content
Global Development Model • • •
Infosys World Wide Expansion Consisted of Global Development Centers in strategic locations locations. Proximity Development Centers with teams near clients. 8 ODC’s in India. 2 PDC’s in US 1 in Canada and 1 in UK
Key drivers of the Global Delivery Model Process, Quality, Tools, Knowledge Management, Program Management, and Risk Mitigation
Organizational Structure • Until 1999 there were 9 self contained Strategic g Business Units that handled functions such as Sales, Marketing, and delivery systems. • After 1999 Practice Units which acted geographically. Helped take advantage of economies of scale.
Stretch Strategy • Stretch Goals was originally coined by Jack Welch of GE to describe goals which seem unattainable given the current resources at hand.(12manage.com) • Concentrating Resources: Infosys knew it wanted to be a global company, and focused its plan on a way to get there through quality work, the best people, and a level of trust with clients. • Moved up the value chain(SAP consulting)
Capability Maturity Model(CMM) The CMM describes the principles and practices underlying software process maturity. y It is intended to help p software organizations improve the maturity of their software processes in terms of an evolutionary path from ad hoc, chaotic processes to mature, disciplined software processes. The focus is on identifying key process areas and the exemplary practices that may comprise a disciplined software f process.
Taken from http://www2.umassd.edu/swpi/processframework/cmm/cmm.html
Annual Income Statements All amounts in millions of US Dollars
Put info from website, numbers on company, growth today etc....
Operating Income
Total Net Income
Diluted EPS (Net I Income) )
Year
Revenue
Gross Profit
Mar 08
4,176.0
1,723.0
1,151.0
1,155.0
--
M 07 Mar
3 090 0 3,090.0
1 313 0 1,313.0
852 0 852.0
850 0 850.0
--
Mar 06
2,152.0
908.0
599.0
555.0
--
Company p y Type yp
Public - NASDAQ (GS): INFY; Mumbai: Full Quote Main Headquarters
Fiscal Year-End
March
2008 Sales (mil (mil.))
$4 176 0 $4,176.0
2008 Employees
91,200
Title
Name & Bio
Contact
Co-Chairman and Chief Mentor
N. R. Narayana Murthy Age 62 $12,898 salary $35,017 bonus
Network | E-mail
Co-Chairman
Nandan M. Nilekani Age 53 $51,414 salary $122,841 bonus
Network | E-mail
CEO, Managing Director, and Head, Executive Council
S. (Kris) Gopalakrishnan S Age 54 $51,414 salary $122,841 bonus
Network | E-mail
04/21/09 15:00:04 EST • NASDAQ • $27.21 • 0.0000 • 0.0000 %
Infos s Fin. Infosys Fin Ratios
Compan Company
Industryy Median
Market Median1
Price/Sales Ratio
4.07
1.01
0.89
Price/Earnings Ratio
--
11.25
10.11
Price/Book Ratio
4.35
1.29
0.89
Price/Cash Flow Ratio
14.80
6.91
5.73
Infosys Comp. Int.
Satyam
Tata Consultancy
Wipro Technologies g
Annual Sales ($ mil.)
2,138.1
5,722.2
1,637.3
Employees
--
108,000
29,800
Market Cap ($ mil.)
--
--
--
Infosys Strategy • •
•
Infosys y focuses on Predictability, y Security, y Quality, and Value Creation Infosys creates these solutions for its clients by leveraging its domain and business expertise ti along l with ith a complete l t range off services. i Transparency, world-class processes, speed of execution and the power to stretch their IT budget by leveraging the Global Delivery Model that Infosys pioneered. (Infosys Website Global Facts Pdf)
Strategy • • • •
Grow Globally q y Build Brand Equity Move up the Value Chain One Stop Shop