Would like to go back to retired life: Infosys' Narayana Murthy

Mysore: On a day software giant Infosys posted 21.4 per cent rise in its net profit, the firm's Executive Chairman and co-founder N.R. Narayana Murthy expressed his desireness to go back to his retired life.

Murthy returned from retirement in 2013 to revamp the company's sinking image. However, he also mentioned his sadness as top leaders are exiting the IT giant.

Murthy insisted that there is no shortage of leadership in infosys.

Read here: Infosys Q3 profit up 21 per cent; revenue growth outlook raised

Murthy's remarks came at the press conference where the company revealed its Q3 earnings. Murthy, who returned from retirement in June 2013 to take charge of the struggling company, spoke to the media on a range of issues.

Unfazed by the exodus, the Infosys co-founder said he wished luck to those who quit the firm and said the company has a strong cadre of leaders and that its future will not be 'compromised'.

"These people have shouldered heavy responsibilities in the company. For several years, some of them have taken new work, bigger responsibilities. So therefore, I would say that we wish all the people, that have left us, the best," Murthy told reporters here.

Murthy said he was confident of the strong cadre of leaders that the company has.

Asked if his son Rohan is being groomed for the top job at Infosys, Murthy said it is a decision to be taken by his son. He added that Rohan, who is on leave from Harvard, would like to go back at an appropriate time.

"...what position he will hold in Infosys, that is not for me to decide...who knows he may change his mind, he may do something else in India - who knows, so I cannot commit what he will do in his future. That's not fair on my part," Murthy said.

Speaking to analysts in the morning, Murthy said Infosys was the first Indian company to set up a leadership institute.

"We have a three-tier programme and these three tiers have developed approximately 600 leaders...We have a large number of enthusistic and energetic people who report to people in this room. As far as the future of this organisation is concerned, that future will not be compromised for leadership," he said.

In the last few months, Infosys has witnessed a steady exit of top-level executives with Board member and BPO business head V Balakrishnan being the latest casualty.

Another board member and Head of Americas business Ashok Vemuri, who was considered to be a top contender for the CEO's position after Shibulal's retirement, quit the firm to join iGate as CEO.

Other exits included Vice President and financial services head (Americas) Sudhir Chaturvedi, sales head Basab Pradhan and senior vice-president and head of financial services (Americas) Shaji Farooq.

Last week, the company announced restructuring of its business under two divisions to be headed by B.G. Srinivas and U.B. Pravin Rao.

These two are now being considered as possible contenders for the CEO's post after S D Shibulal retires.

Infosys has also dissolved its top decision-making body, the executive council, with effect from April 1, 2014.

Besides top management, the company is also struggling to retain mid and lower management staff.

For the October-December 2013 quarter, the company added 6,682 employees on gross level in the reported quarter, but the total headcount was lower by 1,823 at 1,58,404 people.

Chief Executive and Managing Director S.D. Shibulal said the company has given compensation increases and promotions, while changing the variable computation structure.

"There are a number of deliberations going on within the organisation on the next phase of change regarding next compensation increase, what will be the next promotion cycle, all of that is being deliberated. So, we are focussed on meeting our employees aspirations," he said.

While most IT firms revise salaries in April or May, in 2012, Infosys gave a wage hike in October. Following Murthy's return last year, Infosys raised salaries for staff in India by 8 per cent on average in June.

"We all believe we would like to move back to the April cyle. Our desire is to move back to the old cycle as far as wages are concerned," Murthy told analysts today.

Reports suggest Infosys may offer double-digit pay hikes this year to keep the workforce motivated.

Next: Infosys struggling to retain talent at mid and junior levels

Infosys struggling to retain talent at mid and junior levels

Already facing an exodus of top management, Infosys is also struggling to retain talent at mid and junior levels, with 1,823 people leaving the firm in the October-December quarter.

The country's second-largest software exporter added 6,682 employees on gross level in the reported quarter, but the total headcount was lower by 1,823 at 1,58,404 people.

Infosys said the net hiring is down since freshers from the campus had joined in the first two quarters.

"Net hiring is down because the freshers joinings have already happened in the first two quarters. But as we move into planning for next year, we are looking at hiring people from campuses," Infosys CFO Rajiv Bansal said. Infosys' attrition rate has also continued to rise.

In the December quarter, its employee attrition rate stood at 18 per cent - the highest for the company in the past two years.

It stood at 17.3 per cent for the second quarter of the ongoing fiscal while it was 15.1 per cent in Q3 FY'13. Over the past seven months, the Bangalore-based firm has lost nine senior-level executives, including board member V Balakrishnan and global manufacturing head Ashok Vemuri.

However, CEO and MD S D Shibulal played down the exits. "The organisation is definitely going through a transformation. This is a large corporation with 1.6 lakh employees. Even if I assume that we have 1 per cent of the people as leaders, that is 1,600 people," Shibulal said.

He added that the exits are very few and should not be overly focussed upon. "Because these are great leaders, these are people with tremendous skills and they also have aspirations, they sometimes have larger aspirations than what Infosys is and these people do look at their aspirations when the transformation happens," Shibulal said.

He added that there will be 'some inconvenience' at the time of transition and the company has a large talent pool to groom its next set of leaders.