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“Respect From Stakeholders Must Top Corporates’ Vision Statement”
Self-reliance should be defined as “earning enough global currency to import whatever is needed for the welfare of the nation,” says Infosys founder Narayana Murthy
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Infosys founder NR Narayana Murthy is one of the tallest leaders that India Inc has produced. Infosys, as also Murthy’s leadership by example, marked a new era in the evolution of the market economy in India. BW Businessworld asked a couple of columnists about Murthy and Infosys, the values they epitomised, and how they marked the beginning of an era.
In response to a question, Ajit Ranade, Vice Chancellor, Gokhale Institute for Politics and Economics told BW Businessworld: “Narayana Murthy is someone who inspires people from all walks, be they professionals, entrepreneurs, students and even politicians. His work and journey proves the maxim that it is possible to create wealth in an ethical way, and share that wealth with your co-workers and society at large. He demonstrated that it was possible to start from zero and become one of the world's software powerhouse company.”
Economist and member of the 14th Finance Commission, M. Govinda Rao, on the other hand told, BW Businessworld: “The entire Infosys project was a result of like-minded people with similar qualifications getting together to pursue a common goal of creating a company in a relatively new area of information technology. The liberalisation helped in the process. Second, right from the beginning, the standards of leadership and corporate governance (at Infosys) were high. The profit margins were high in the beginning and therefore, the focus was to earn money through legitimate means and expand as the demand for service expands. Third, the choice of location of work was excellent both from the viewpoint of getting qualified personnel and having agglomeration economies. Besides, at that time, the bureaucracy in Karnataka was more responsive.”
When BW Businessworld caught up with Murthy recently, there were plenty of insights – about corporate world, leadership lessons and life lessons. Excerpts from the chat:
Infosys founder Murthy feels that India has now got respect in the international community, and “it’s for the youth to build and consolidate on it”. The former Infosys chairman, and one of the most distinguished -- and decorated – leaders to have been produced by India Inc, says that for any corporate, “respect form all stakeholders must top their vision statement and agenda”.
On Corporate Governance
Murthy says that corporate governance is about “maximising shareholder value while ensuring fairness, transparency, and accountability to every stakeholder”. “Performance leads to recognition; recognition leads to respect; and, respect leads to power,” he said, in response to a question.
Under Murthy, Infosys came to be widely acknowledged (in India and outside) for its cutting-edge innovation, entrepreneurial genius and best practices -- a legacy that was very ably carried forward by successor Nandan Nilekani. “My fervent plea to all the corporate leaders in this country and elsewhere is that they should put respect from the stakeholders as their top line in their top priority,” he said. Infosys has been named as the “Most Respected Company” in BW Businessworld’s rankings thrice.
While the world may be witnessing increasing protectionism and a new thrust on de-globalisation, Murthy has an interesting take on self-reliance. He said: “Thanks to (former US) President Trump, nationalism is more important that globalisation. Following that, every nation started saying, ‘We'll first look after ourselves and then other country…’ I would say that self-reliance should be defined as ‘earning enough global currency to import whatever is needed for the welfare of our nation’. Self-reliance is not saying that we'll close our doors to imports. We should encourage our entrepreneurs and companies to export enough so that we have enough foreign exchange surplus to buy whatever best we want for our people in this country and still have some money left in our pocket. That, to me is, self-reliance.”
He added: “Liberalisation was perhaps the most impactful event (for Indian enterprises). It's very difficult for me to remember anything more impactful.”
In response to another question in the current context, he said: “I (have) also learnt that corporate governance is about maximising shareholder value while ensuring, fairness, transparency, and accountability to every stakeholder: that is customers, employees, investors, vendor partners, government of the land, and the society.”
On India’s Economic Potential
Talking about India’s economic potential and the global order, the Infosys founder said: “…For the first time in 300 years, India has got some respect in the international arena that it is the responsibility of youngsters to consolidate that respect into even bigger respect. And that can only happen by performance. As I said earlier, performance leads to recognition. Recognition needs to respect and respect leads to power. Therefore, if we all want India to be a powerful nation, first it has to achieve economically.”
On Compassionate Capitalism
Murthy swears by compassionate capitalism, an idea he first talked about in 1974. “Compassionate capitalism is about capitalism in mind, liberalism and socialism at heart. It means the leaders of capitalism must ensure that the lowest-level employees’ welfare is first looked at before they start looking at their own welfare,” he explained, adding: “you have to become a friend of the commons, a friend of the society”.
“In a ship or on a plane, it is the captain of the ship or the pilot of the plane who gets out of the plane last. Therefore, we, in the corporate world, should also look after all our employees, starting with the lowest-level employee,” he added.
On Job Creation
There may be a debate on the private sector contributing to job creation, but Murthy said it must be properly contextualised. “No company should say that ‘our objective is to create employment’. What one should say, instead, is ‘our objective is to become much bigger in revenues, profitability and succeed in the marketplace’. If we did that, then we will automatically create lots and lots of high quality jobs,” he explained.
On People Who Influenced him
Murthy counts Mahatma Gandhi as his biggest influence. His mother, and many teachers have had a huge influence on him. His wife, Sudha Murty, an acclaimed author, educator and philanthropist is a pillar of strength to him. Murthy was by invited by Prime Minister Atal Bihari Vajpayee to become country’s IT Minister in 1999 – an offer he politely declined.
Talking about leadership lessons from his parents, and his teachers, Murthy said: “I learned from my teachers. I learned from my parents some important lessons that I have been using in my professional life. They are: first, leadership by example, walking the talk, and practicing the percept. Second, putting the interest of the company ahead of one's personal interest in every transaction. Third, I have realised that performance leads to recognition. Recognition leads to respect. And respect leads to power. Fourth, I have realized that fairness is extremely important If you want to succeed. Also, one must use data and facts to judge every transaction, and one must start every transaction on a zero base”.
On Business Climate: Then & Now
On the business environment that existed during the inception of Infosys and on how things have changed now, he said: “During our times, government was very business-unfriendly. On every step, there were hurdles. Today, the government, under Prime Minister Narendra Modi, has made tremendous efforts to become business-friendly. Therefore, I would say, today, entrepreneurs’ challenge is not obtaining approvals from the government, or obtaining bank loans, or getting telephones. Because of current account convertibility, one need not go to the Reserve Bank, when one travels abroad, when one opens offices etc.”
He added: “Today, the market is most important. It is the market that determines whether you succeed or not. Second, there is a tremendous competition for talent. Third, the need of the day is for us to train our employees to become more and more problem-solving oriented. We have to train our employees to be able to compete with the talent of the developed work, which I think a lot of IT companies are doing. But there are many other areas that we have to do (a lot more).
The Covid-19 pandemic may have made “work-from-home” the new normal, but Murthy is no fan of the culture. “I have realised that work is to be done in the office and home is for family. There is no point in mixing the two. I understand that during the pandemic period, we had to work from home, but once the pandemic got over, it is very, very important for us to get back to the principle that ‘you work extremely hard in the office, and you come home and spend time with your family’.”
On Work-life Balance & Family
On work-life balance, he said: “I have also realised that in a family, the two partners, husband and wife, have to celebrate the strengths of each other, and tolerate and empathetically try to improve the weakness of the other partner.”
Asked if he had a fine work-life balance through his career, he said: “I don't think I followed a work-life balance. It was all work for me. Even when I came home, there used to be tens of phone calls every night. Whenever I had any time once I was home, my wife and I would take our children to a favorite restaurant of theirs, maybe on MG Road, Churchgate (in Bengaluru), where they would eat their pizza or french fries or pasta or whatever. And we would buy them some toys. This was a small way to keep our children happy when all of us were together”.
Murthy’s wife, Sudha Murty, has always backed his career decisions. “When I founded Infosys, before I spoke to any of my younger colleagues and invited them to join me in founding Infosys, I sat down with my wife and, I told her of my desire to start this company the second time (first one, Softronics, was a failure). She told me: ‘This is your second attempt. You have learned some lessons from your first attempt. Therefore, you have to work very hard. You'll have to focus 18 hours a day on your company. You have to make sacrifices. You have to travel to the different places’. She said, ‘I will take care of your family’,” recounted Murthy.
Murthy’s parting shot: “When we become high-quality citizens, then only we have the right to demand high quality services. So my request to our citizens is to learn from the examples of other developed countries, and become high-quality model citizens of this country, and then we can criticise others. That is most important.”