Infosys is implementing a wide-ranging plan to improve sales effectiveness, said senior executives of the Bangalore-based company, predicting that the benefits of these measures could start showing up before the third quarter of 2014-15.
India’s second-largest software company, which is attempting a turnaround under chairman NR Narayana Murthy after more than two years of underperforming the industry, is stepping up hiring in overseas markets and enhancing training for all client-facing executives as part of a new sales push, the executives said.
“We are embarking on our journey to increase sales effectiveness,” said BG Srinivas, one of the two presidents of Infosys who oversees most client-facing functions.
Srinivas, an Infosys board member who along with president UB Pravin Rao is considered to be a contender to succeed SD Shibulal as CEO, said the company is focussed on not just sales capability but also its ability to engage with clients in a consultative manner by helping them identify and solve business problems.
“We have also restructured our go-to-market in particular verticals where we want to enhance our presence, namely insurance, life sciences, healthcare, energy & utilities,” he said.
In March, Shibulal had warned of softness in revenue in the final quarter of fiscal 2014 and the first quarter of fiscal 2015. Infosys has forecast that revenue for 2014-15 will grow by 7-9% compared to the 13-15% prediction for export growth by industry body Nasscom.
In addition to experienced personnel, some 200 executives are being hired from B-schools, improving connections in cultural and business contexts overseas, particularly in Germany and France. Infosys push to have domestic sales teams in its markets is akin to the localisation strategy by other Indian service providers.
“So if you look at this model from a distance, you will see capacity increase, capability increase, and finally sales effectiveness. So that’s how it works in retail,” said Sandeep Dadlani, senior vice-president and global head of Infosys retail, consumer products group and logistics. Retail was one of the areas where Shibulal flagged weakness citing store closures because of adverse weather in the United States.
On the cost front, some of the measures include enhancing the capability to automate and bring down the total time required for delivery of solutions, Srinivas said.
Dadlani, who heads a vertical with revenue of $1.3 billion (Rs 7,800 crore) and over 15,000 employees, said the training is aimed at giving “hands-on learning on actual clients and sales proposals” to account managers.
But even as Infosys implements a new strategy, analysts say the company has to first bring in stability in its senior management.
“The biggest challenge Infosys faces is retaining and hiring talent,” said an analyst at Mumbai-based brokerage. “And this shows why the company is struggling on the delivery front or acquiring new clients or even getting more business from existing clients because they simply do not have experienced people.”
Analysts at JPMorgan too maintain that of Infosys’ planks for revival, the company seems to be progressing well on only cost optimization.
“We would need to see firmer signs of progress on the other two planks (sales effectiveness and delivery productivity),” analysts Viju K George and Amit Sharma wrote in a note.
