New CEO Salil Parekh faces real test of staying calm at Infosys

04 Dec 2017

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Months after Nandan Nilekhani assumed interim leadership at Infosys, the founder director seems to have found his choice to replace ousted Vishal Sikka as CEO - Infosys on Sunday announced the selection of Salil Parekh, another outsider, as its next chief executive officer.

Parekh who, a few years ago, gave a presentation to the industry body Nasscom on the sector's challenges, but advised the industry to ''Stay calm, don't panic,'' now faces the odds. He now faces the real challenge of getting the iconic Indian outsourcing company back on track.

Parekh, 53, who was on the board of consultancy major Capgemini, was on Saturday named as the new CEO of Infosys beating some of the top internal candidates and former executives who had originally been considered front runners.

Parekh will leave Capgemini's executive board to start his five-year term at Asia's second-largest outsourcing firm in the beginning of 2018.

''Salil brings hugely relevant experience to Infosys,'' Nandan Nilekani, who returned as chairman when Sikka left in August, said in an interview. ''He will fit into our culture and, at the same time, bring about the required transformation.''

The new CEO, however, will have to maintain a genial relationship with focused founders such as N R Narayana Murthy while taking bold steps to revive growth and restore employee confidence.

Infosys is struggling to move beyond its traditional low-margin outsourcing business into more profitable markets such as digital services.

Vishal Sikka, who pushed the digital business, however, faced the ire of the company's founder directors who objected to his strategy and compensation policies.

Sikka had to finally quit over what he described as ''a continuous drumbeat of allegations'' over management and corporate governance.

A few years ago, Parekh gave a presentation to the industry trade body Nasscom. His talk, after recapping the sector's challenges, included a slide that read: ''Stay calm, don't panic.''

Parekh is unassuming to the point that his LinkedIn profile simply says he's a ''Business Manager'' at Capgemini. Still, he has a blend of Ivy League credentials and operational experience that appealed to the board.

He earned a degree as an aeronautical engineer from Indian Institute of Technology-Mumbai - also Nilekani's alma mater - and has a master's degree in computer science from Cornell University.

Parekh was a partner at Ernst & Young when Capgemini bought the IT consulting practice in 2000. From a small warehouse in the Vikhroli neighborhood in Mumbai, Parekh had since expanded Capgemini's operations and helping it compete on costs with competitors such as Tata Consultancy Services Ltd as well as Infosys itself.

''He is down to earth and relates well to people,'' said CP Gurnani, chief executive officer of rival outsourcer Tech Mahindra, in an interview. ''His strengths are in strategy as well as execution.''

Parekh is only the second outsider after Sikka to take the top job at the 36-year-old Infosys which employs over 2,00,000 professionals across the world.

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