Analysts give a thumbs up to new Infosys CEO

Infosys has announced the appointment of Vishal Sikka as company’s new CEO and MD that comes into effect from August 1.

It’s for the first time that Infosys has brought in an outsider and a non-founder to lead the company.

Analysts have seen the appointment of Vishal Sikka as positive for Infosys as it will steer the company in a new direction at a time when IT services is undergoing transformation.

According to Tom Reuner, Principal Analyst, Ovum, “this is a watershed moment for the company. Vishal Sikka will be the first CEO, who is neither part of the founding generation nor an insider from Infosys.”

“The announcement comes after a string of resignations of senior executives that have led to perceptions of an overbearing influence of the executive chairman Narayana Murthy,” added Reuner.
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Though, Vishal Sikka is considered as the best option company could have to bring back Infosys on track, according to some industry experts, Sikka will face tough challenges as well.

Partha Iyengar, Country Manager – Research, Gartner India, said that the news of Sikka’s appointment is extremely important for Infosys since it ends the uncertainty that was the main enemy of Infosys.

“The new CEO will have to move very quickly to first calm the three key stakeholders — employees, customers and the investors. Infosys cannot afford any more resource departures especially at senior levels,” Iyengar said.

“He will next have to establish credibility with those stake-holders, again, in a fairly short period and then energise them in the medium to long term,” added Iyengar.

According to Jaideep Mehta, Vice President and General Manager, IDC South Asia, “Infosys needed a heavyweight external CEO and he brings the necessary gravitas to the role.”

“The IT Services industry is going through a transformation from plain vanilla to platform and IP based services. With Sikka’s extensive experience in SAP, and the success of HANA, he has a deep understanding of where Infosys needs to go, and what it needs to do to get there,”  he added.

Reuner of Ovum expressed same views about Sikka’s experience and skills with regard to SAP.

“Vishal Sikka was highly regarding within SAP and his remit was to foster innovation. This mindset could be conducive to lead Infosys back to its past glory. Even though this will be his first appointment as CEO, Sikka combines the cultural affinity to the Indian corporate culture with vast experience in the global marketplace,” said Reuner.

Reuner touched on the very key aspect of Sikka’s work — challenges and success in co-relation with Infosys Executive Chairman N R Narayana Murthy.

“In the end, much of his success depend on how he will work with Murthy, who despite the intention to step down will remain a dominant figure,” said Reuner.

“Sikka’s task is a daunting one —to lead the erstwhile poster boy for the success of the Indian IT sector, that has been epitomised in Thomas Friedman’s seminal work “The World is Flat”, back to its former glory. We envisage a bumpy road ahead for Sikka,” he concluded.

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