On 16th July 2014, Vishal Sikka got appointed as the first non-founder CEO at infosys, the second largest Indian IT service company. After 3 years and 2 months of duration of his employment, Sikka resigned from the post on Friday.
Sikka gave Personal attack as a reason for his departure. In a letter addressing his employees, he, quoted, ” It is clear to me that despite our successes over the last three years and the power seeds of innovation that we have sown, I cannot carry out my job as the CEO and continue to value, while also constantly defending against unrelenting , baseless , malicious and increasingly personal attacks”. Post Sikka’s resignation, the share market value of infosys dropped by over 9%.
During his tenure as the CEO and MD, the company witnessed 13.3% growth in its revenue with net profit of Rs 2000 crore. More than 25 new services were launched in his tenure that rose the revenue from 0% in April 2015 to 8.3 percent in the last quarter. Despite a disturbed business environment, Sikka managed to keep up the company’s operating margin at par with the major Indian IT firms.
After the revenue growth during 2015-16, Sikka had set a very high goal which was more than doubling Infosys’ revenue to US $250 billion, with margins of 30% and employee productivity of US $80000, which was later admitted by the board and Sikka as “impossible to achieve”. During the same fiscal year, 325 clients were added, higher than the 200 clients acquired in previous five years, and the cumulative value of large deals rose to US $2.7 billion from US $1.9 billion.
In 2016, Sikka launched ‘Zero distance’ drive plan to increase the productivity by pushing employees to come up with different ways to solve costumer’s problems.
In February 2017, Sikka was alleged of buying an Israeli Company, Panaya, for six time it’s revenue in 2015. He was also alleged of having agreed to a huge payout for Rajiv Bansal, the former CEO of Infosys. When Narayan Murthy asked the board to release the full investigation reports related to the deal, it was refused. Later on, the US law firm “Gibson Dunn & Crutcher” gave the company a clean chit post on independent Forensic investigations.
Sikka’s high salary was always questioned by the company’s founders to which the board always linked to his steep performance. In the year 2015-16 his salary was increased by 85 percent from the previous year while the increase in the median employee salary was only 6.4%.
Many Indian companies were facing a lot of problems in doing business in the United States after Donal Trump got appointed as the president, Sikka saw many opportunity in this situation and was quoted saying that he sees tremendous opportunity to do innovative work and that Indian companies have a bright future.
Under Sikka’s reign, the company yielded many profits. However, several controversies surrounding him, failure of governance and founders’ criticism eventually led him to submit his resignation.
Image Source: CNBC address screengrab