IT & ITES

“Growth thru Business Excellence”

Narsimha Rao
Head-Hyderabad Center,
Infosys Technologies Limited
 Business Excellence

 “Being the best in the chosen field of Business”

 As much about Delivered results to all Stakeholders

as much about Future Prospects

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 Business Excellence – 4 Pillars for us in Infosys

 Predictability
 Sustainability
 Profitability
 ‘De-risking’ of Business

…… PSPD model for Business

And management accountants have a big role to play in all of this..

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 The evolution of the IT industry – Stage-1

 The pre-liberalization stage – till early ‘90s

o Predominantly skills’ exports

 Role of (Management) Accountants:

• To a large extent non-existent
• Compliance to the Guidelines / rules

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 The evolution of the IT industry – Stage -2

 The early growth phase – ‘93 to ‘98/’99

o The advent of STPIs
o Opening up of the Telecom sector
o The evolution of the Global (India-centric) Delivery Models
o Changes in the Financial Markets

 Role of the Management Accountant

o Set in Business Practices to assure Stakeholder confidence
• World-class practices in Accounting & Reporting
o Put in Place Operational controls and push for data-backed decision-making
• Provide Senior Management with data on key operational performance metrics
• Top-line / Bottom-line tracking
• People utilization and other direct costs

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 The evolution of the IT industry – Stage-3

 The Big Push– ‘98/’99 to 2003-04

o The dot-com boom and the bust
o The ensuing off-shoring wave
o Acceptance of Global Delivery model as a sustainable business activity
• Consequent rise in expectations by all stakeholders – QSQT phenomenon
• expansion in range of services
• emergence of MNC players in India
o Companies emerging to significant sizes

 Role of the Management Accountant

o Decentralized decision-making => Operational parameter reporting/monitoring at sub-unit
level going down to Project level
o Use of Technology as an enabler to the Business – timely alerts & faster response to change
o Need for greater push for Financial planning & Budgeting
o Proactive involvement in the Sales Process for better deal negotiations & for winning deals

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 The evolution of the IT industry – Stage-4

 The Consolidation / Emergence of Indian MNC - 2003-04 till date

o Tier-1 companies scaling up to significant sizes and continuing to maintain growth rates
o Global SIs (the Big 4 and the like) reaching critical sizes in India
o Large and Complex deals being negotiated
o Need for Financial disclosure requirements – SOX Compliance
o Increasing M&A with ever increasing deal sizes – with almost all players in the game
o Continuing high-expectations on delivery of results in this sector
o Increased focus on Corporate Governance

 Role of the Management Accountant

o Greater involvement in the Sales Process for structuring deals
o Likewise, in the M&A Activity and subsequent integration
o Dealing with cross-country / cross-business units / inter-company issues
• Incentivizing Collaboration at the same time maintaining accountability
o Management of Enterprise Risks & timely alerts on key business risks
o Greater Emphasis on Operational Parameter tracking & higher number of these parameters

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 Looking Ahead.. The Expectations

 Very high potential to make a big difference to the Business

…… key is to understand the business

 Proactive bubbling up of early warning signals

……. At the same time help businesses stay nimble and flexible

 Quantification and Reporting of non-financial business parameters

…….. Changes to Human Capital, Brand value, IP, Stakeholder satisfaction, etc.

 Ability to provide inputs to all layers of management

……. right amount of detail with ability to drill-down effectively

 Need Paranoia for eliminating Waste

……. Be it in our Business Operations or in our Business
Assurance operations or in Analysis & Reporting

 Last but not the least, focus on PSPD ……

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Thank you

narsimha_m@infosys.com