Infosys builds new culture for product play

BANGALORE: IT major Infosys is trying to develop a DNA in its product and platforms business that nurtures out-of-the-box thinking, the way start-ups do.
The most successful product companies around the world are admired not for focus, process or discipline, but rather for their free-spirited and unorthodox thinking, seeing old problems in new ways, and perhaps even a little chaos.
Infosys’s product R&D’s attempt will be to imbibe some of these traits. For those who view Infosys as conservative, this may come as a surprise. TOI had reported in May last year that Infosys was planning something along these lines.
For starters, the product R&D team will be treated distinctly from the services business. Subu Goparaju, head of product R&D at Infosys, said that his team has been consciously housed separately from the services business to “avoid IT contamination”. The IT services environment is more process oriented, repetitive and the scope for innovative thinking and creativity is limited.
The product R&D team, however, aligns itself with the company’s major IT services business verticals like banking, financial service and insurance (BFSI) and manufacturing. It is credited with developing the banking product Finacle and mobile platform Flypp. Over the next two years the team will be expanded to 1,000 engineers, from the current 500.
Goparaju said that the engineers hired are a ‘different breed of people’. At the lateral level they have work experience in product and startup ecosystems. The freshers for this division are trained at the Mysore campus, just as all other freshers, but they have a separate training methodology and curriculum. The division has created new positions at VP and AVP levels to support the team.
Goparaju said employees are given the freedom to come up with product ideas by observing industry pain points. These are then validated by testing and co-creating the product with clients. There is also a lot of cross-pollination – using an idea from one vertical to develop products for multiple verticals.
Infosys has so far commercialized about 12 platforms and 6 products. Some others are in various stages of development. These products and platforms are also branded uniquely. Some of the new areas of involvement include digital consumers, supply chain efficiency and performance management.
Sundararaman Viswanathan of consulting firm Zinnov said Infosys is the most progressive Indian IT company in the products space. “With IT services getting commoditized and with pricing and margin pressures building, non-linearity and differentiation become vital,” he said.
But the lack of a precedent where a services player has developed a successful product play in the past worries some analysts. Ankur Rudra, IT analyst at Ambit Capital, said that even giants like Accenture have not succeeded in the game. “Just a division in the company having a different mindset might not help, while the core leadership team remains services focused,” he said.
In June last year, the then head of innovations at Infosys, Subash Dhar, quit the company on not being given a board position as he felt that for a strategic service line like business innovation, a board level position was imperative. There is still nobody from the product R&D team holding a board position. The long-term target for Infosys is to earn a third of its revenues from the products business from the current 5%. In this quest, Goparaju is open to looking at models of work suited to a product environment. “For instance, flexible work timings are an option that cannot be ruled out,” he said.