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business leaders > profiles > Narayana Murthy
Narayana Murthy
Quest for excellence
On his 60th birthday on 20 August 2006, N R Narayana Murthy will step down as chairman of Infosys Technologies, a company he co founded in Bangalore back in 1981 along with six other software engineers.

Twenty-five years back they pooled their resources to create an Indian IT start-up that has now become an extensive global IT powerhouse and a role model for an entire generation of Indian infotech entrepreneurs.

Infosys is today synonymous with dynamism and innovation in software technology, excellence in corporate governance and social responsibility together with exceptional customer and employee satisfaction. The unique success story of Infosys is founded largely on Murthy's personal vision and conviction. He saw an opportunity in software, built a core team and instilled in it an abiding value system that has been imbued equally in the steady stream of later recruits.

Under Murthy, a BE from the University of Mysore and M Tech from the Indian Institute of Technology, Kanpur as CEO from 1981 to 2002 the company, with its innovative practices, succeeded in overshadowing several better established software companies. In 1999 Infosys became the first Indian company to list on the NASDAQ (INFY). It was also the first listed Indian company to institute a company-wide, performance-based employee stock option plan that cut right across the hierarchy. In March 2002 Murthy handed over the job of the president and CEO of the company to one of the other co-founders, Nandan M Nilekani.

Murthy and his team proved that in India, where business enterprises are jealously held family fiefdoms, it is possible for middle-class professionals without family business connections to build successful enterprises that create industry benchmarks.

Murthy's convictions perhaps took definite shape while he was chief systems programmer at the Indian Institute of Management, Ahmedabad, often putting in 20 hours a day, going home at 3:00 in the morning and returning to work at 7:00 am. It was here that Murthy took to heart a professor's advice that at his age learning was more important than making money.

A socialist capitalist
Murthy, who had Left leanings, was deeply impressed with the West European socialists whom he met during a trip to Europe early in his career. Murthy realised that these socialists had understood that wealth first had to be created before it could be distributed.

Interestingly, his disillusionment with socialism also came abput in Europe, but in the then East Bloc. On his way back to India by land he boarded the Sofia Express at Nis, a border town between the then Yugoslavia and Bulgaria, where he struck up a conversation with a girl in the compartment.

After about 45 minutes the train stopped, a contingent of police boarded the compartment and took away the girl. They ransacked Murthy's backpack and had him locked up in a room that had no mattress and a small window 10 feet above. He was kept there for the next 60 hours before being freed. Murthy has no idea why he had been detained in the first place.

All that the authorities told him at the time of his release was that since he was from a friendly country, he was being allowed to go. The experience shook Murthy and his faith in socialist governments. That is when he decided that he did not wish to have anything to do with a system that treated "friends" in such a peremptory manner.

The early days of Infosys
Infosys was set up when the country was firmly under regulatory controls. It took Murthy and his team one year to get a telephone connection and three to get the first computer. Banks routinely turned down their loan applications. However, in the early '90s the picture dramatically.

Liberalisation eliminated the need for approvals from regulatory authorities in Delhi, and made the import of high-tech computers and software possible. It made equity a viable financial option by allowing lead managers to determine public issue premiums. It greatly facilitated foreign travel and opening overseas offices.

With liberalisation came liberalised foreign investment and 100-per cent ownership by multinational companies. Murthy, then president of NASSCOM, the association of Indian software companies, could well have lobbied against MNC entry into India, as some of the established, family-owned business groups did. He didn't, because he believed that full-fledged competition was inevitable, and the country's businessmen may as well get accustomed to it.

Murthy holds these developments as critical to Infosys's triumphant march. Although a firm protagonist of his own unique brand of capitalism, he reminds the government that it must create an environment where it's possible for people to create wealth.

As leader of a spectacularly successful corporation, Murthy places the highest value on introspection and setting one's house in order before apportioning blame anywhere. In the culture he has created at Infosys, people are encouraged to be inquisitive, articulate and transaction-oriented. They work happily in a "fun atmosphere" on the premises, designed to enrich the experience of all employees working there.

One of Murthy's ageless convictions is that corporations have an important duty to contribute to society. It is his abiding concern that the chasm between the haves and the have-nots of the world has widened, especially in the developing world, in spite of the visible economic progress achieved. It is imperative to him that corporations make a difference to the context so as to sustain its progress. It is equally important to him that these initiatives come from the corporation itself rather than being imposed by external agents.

With this voluntary commitment to contribute to its social milieu, Infosys established the Infosys Foundation in 1996 as a not-for-profit trust to support initiatives that benefit society at large. Infosys has also instituted social programs that target educational institutions specifically in the rural areas.

One of the richest men in India, Murthy personifies his very own concept of "compassionate capitalism", which aims at making capitalism an attractive option to the common man. He lives the life of a middle-class Indian in a house in the middle-class Jayanagar locality of Bangalore with his wife Sudha, an engineer, and their two children, Akshata and Rohan. Sudha Murthy now heads the Infosys Foundation, which runs healthcare, education, rural development and art projects across the country for the underprivileged.

Murthy, committed to enhancing India's brand equity, sees democracy where public good precedes personal gain, "where responsibilities come before the rights," he said in a press interview.

And, when he is not busy making a pretty dent in the cyber world, Murthy enjoys listening to Western classical music and makes sure that the pleasure comes from the journey, no matter what the destination.

Compiled by Shubha Khandekar

Also see:
The Many Hats that Narayana Murthy wears
Infosys Foundation: The soul of a corporation
Global face of Indian IT

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