If Infosys’ recently announced plans for a major expansion and 2,000 new jobs in Wake County were to founder, don’t underestimate the impact of turmoil unleashed at the top of the company. A new letter published in India shows how bitter the fighting has been and notes the financial pain Infosys has already suffered.
“Mr Murthy, Walk away before you further destroy your reputation and debilitate Infosys,” reads the headline on the letter.
The in-fighting among top management at India tech giant Infosys really broke into the open through this remarkably blunt tirade written from a former board member and senior executive in which he lambasts Infosys founder Narayana Murthy for disputes that led to the sudden departure of CEO Vishal Sikka on Friday.
“Learn to walk away, as you had promised when handing the reins to Vishal,” wrote Omkar Goswami, a board member from 2000-2015 who remains part of the tech services firm’s business process outsourcing group.
“Enough is enough. You have drawn first blood. Do not mortally wound the organization by persisting in your actions. Let Infosys get on with its business, heal itself from the injuries that you have inflicted and again grow shareholder value. Learn to walk away, as you had promised when handing the reins to Vishal. The corporate governance halo that was conferred upon you is shrinking. Let it not disappear.”
The letter was sent to India’s Economic Times.
Sikka was the first outside-the-family executive named to lead the company.
In an email sent to WRAL.com, Infosys insisted that plans for expansion in the Triangle and in Indiana would proceed as planned.
Gauging the fallout
However, Infosys’ stock has taken a big hit in the days since Sikka resigned. And employee morale has suffered, according to the letter.
“How can Infosys strengthen employee morale under these circumstances? How can it find a worthwhile replacement for Vishal with you sniping at the wings?” Goswami wrote.
“How can it get away from this sapping, deleterious war that has got it lower valuation and titters from the competition? How can it focus on doing business if you are readying to rearm your weapons?
“You will claim that it is all for corporate governance. But why don’t I, your corporate governance disciple, believe this any more? Nor does any other ex-independent director that I have spoken to, each of whom you respect.”
Goswami points out that time after time the board gave in to demands fro Murthy.
“Why did the board agree to so many of your demands, all played out in public fora? A generous interpretation is that it respected you and wanted to arrive at a middle ground. But it appears that you have not played your part, and have publicly leveraged your lionised position to constantly shift that middle ground for extracting more concessions,” he wrote.
“Truth be told, the board was collectively timid. So, here’s my next question: if you were at the helm, and a person representing a small proportion of Infosys’ share capital did what you have done, how would you have reacted? You would have blasted him out of the water with no quarters given.”
So what happens now?
The Triangle will be watching for the fallout. This fight appears to be far from over.
Read the full letter at: