[nikhil_SB]

IMO its just not about emotions,ego or any other feelings that would make this rift happen, rather its how the organization is projected to the outside world.

Infosys was one organizatiin which believed in ethics, values, morals in the business and they had carried it for a very long time. The founders,especially NM wasn't able to digest the changes happening to the core prinicples of the company. For instance the dress code which was same for last 30 years was immediately changed when Sikka entered, formals were thrown out and employees were allowed to wear casuals. There were many changes which were implememted on monthly basis.Suddenly the company was changing its shape,the process, the way services were delivered.

All this fight became public when the news came out that the salary of CXOs was increased by almost 100% and the next day employees received a mail stating that the hike for the year was postponed by a quarter citing the reason of bad economy . All these reasons made the founders unhappy to see how the company was project to the world.

[hserus]

“Some lawyers” . Gibson Dunn are probably the largest corporate law firm around, with senior staff including for example Preet Bharara, who was responsible for more than one Wall Street fat cat going to jail.

Anyway what would you do when you have such allegations? Government can order a probe under a retired judge, and in industry’s case they appoint a respected law firm to go into the details and submit their report.

Pai has strong opinions on this but he does on everything from being in favor of that steel flyover they were talking about in Bangalore, various other topics on Twitter. So he is welcome to his opinions though they’re not ones that I share.

In any case the issue is moot and Infy will begin a long slide into obscurity if this is true - http://www.moneycontrol.com/news/bus...s_9529301.html

[AMG Power]

Don't know if a 3% jump in share prices within minutes of the announcement of Nilekani's return is exactly a slide into obscurity:

https://m.economictimes.com/markets/...w/60188709.cms

but it could be a slide into obscurity for some other people.

[androdev]

Do you know that a co-founcer of SAP (Hasso Plattner) has more than 8% shareholding in Panaya? Do you know that Rajiv Bansal (CFO then) did not approve the acquisition, then quit soon after the deal and was to receive an unusual severance pay? More than a dozen people from SAP joined Infosys in VP or higher positions. There is nothing illegal but it stinks. I mean is the world so small that acquisitions and senior hires, etc. all have to come from SAP?

I always love it when all these guys follow their buddy who becomes a CEO with unlimited powers and then the CEO is forced out.

[AMG Power]

Oh and did you know that he increased the salary of several staff 600% and more just so that they dont leave Infosys? Several UK staff had their salaries increased from £250000 to £1.5 million! A retention strategy that alludes to the highest levels of incompetence!!

Originally Posted by hserus

Fickle old market. I'm staying out of Infy shares for the foreseeable future.

Sorry for this rather weak OT line -> while I'm typing this on the mobile I'm buying Infy shares through my desktop.

[androdev]

Originally Posted by hserus

And just about a lot of the original Infy founders and staff came from Patni Computer Services. History does repeat itself, sort of.

When you are starting a company, the circumstances are very different. You will not have the means to attract talent, you pretty much beg and convince your colleagues or classmates to join you even when you know they are not that good.

These SAP guys are hired into very senior positions and that too by engaging an executive search firm (it costs a lot to engage exec search firms). It is nothing short of a scam.

I don't mean Sikka was bad or anything, but he is just too naive and run of the mill US CEO. Maybe he should join a company that did not have $5B cash in the bank and show his mettle.

[a*ed]

Originally Posted by AMG Power

Oh and did you know that he increased the salary of several staff 600% and more just so that they dont leave Infosys? Several UK staff had their salaries increased from £250000 to £1.5 million! A retention strategy that alludes to the highest levels of incompetence!!

Also, not to forget that during the same time hikes for employees in India were pushed by a quarter and when it was given was very little compared to the huge hikes the top level management was getting. Good riddance he's gone.

[vamsi.kona]

Firstly I don't own Infy shares and am not that interested in owning them either. Nor am I associated with the company in any manner. So all the discussion to me is more out of academic interest.

Coming to your points

Originally Posted by hserus

“Some lawyers” . Gibson Dunn are probably the largest corporate law firm around, with senior staff including for example Preet Bharara, who was responsible for more than one Wall Street fat cat going to jail.

Anyway what would you do when you have such allegations? Government can order a probe under a retired judge, and in industry’s case they appoint a respected law firm to go into the details and submit their report.

I have no problems with the stature or size of the law firm. But thing is the findings haven't been declared to the shareholders. If the accusations were important enough to start an investigation, it has to be assumed that the outcome of such findings would be of importance for the shareholders.

One thing to note is that the Board mostly overlooked the investigation as is being made out (Since I, or many here aren't privy to the investigations, one should assume, given the Board didn't repudiate NRN's letter, that they indeed overlooked the investigation). And firms of very good stature have been found time and again to circumvent legal as well as ethical practices. Firms such as Arthur Anderson, KPMG (Which incidentally is auditor for Infy) as well as the very law firm Gibson Dunn, have been accused of wrong doings, with Arthur Anderson, then a top auditing firm winding up because of the implications.

Pai has strong opinions on this but he does on everything from being in favor of that steel flyover they were talking about in Bangalore, various other topics on Twitter. So he is welcome to his opinions though they’re not ones that I share.

I don't follow him much to know his opinions on different matters, but in this case the point he raised, that all the founders and the core team they worked with did posses far more secrets which could hurt the business and yet didn't receive any special severance packages, is very much correct, at least personally for me.

[civic-sense]

Paying $230 million to buy a company who has just fired employees and was on the verge of shutting down screams corruption. To help a friend in need is noble, but it should not be by using the company's cash.

This excerpt is from an Israeli news site:

After several crises, and after it was on the verge of closure, Israeli company Panaya is being sold to Indian IT giant Infosys (INFY) for $230 million. Panaya provides automation technology for large scale enterprise software management. The deal values the Israeli company at $200 million, plus its remaining cash of $30 million.

As far as the investors in Panaya are concerned, this is a good deal, since the company was in a severe state of crisis and had laid off employees, and now they are receiving a decent return on their money.

src: http://www.globes.co.il/en/article-i...30m-1001010261

The stench is too hard to ignore.

And then he filled his company with his cronies from SAP, paid them hefty salaries and pushed out senior executives who worked in the company for many years.

He enjoyed the riches for 3 years, and it was time for his appraisal. Even without Murthy's attacks Sikka's time was up.

[sridhar-v]

Firstly a disclaimer:-

My opinions stated below are based on my experience, over the last 25 years, as a vendor to some very large companies.

And I do noat mean to denigrate any general profession or persons in particular.

1. The most important issue in turning around a large company is managing the cultural/man management issues. Almost all so called "professional managers" mess this up.

2. There are a lot of vested interests trying to protect their backsides in the mellee.

3.Understanding the complexities of the business and the company is generally beyond the comprehension of somebody parachuted from outside, particularly if he is not from the same business.

4. All projections of cost synergies etc. go for a toss on contact with reality.

5. Projections for turnaround are made with unrealistic time frames and budgets that are inadequate.

[hserus]

True, trying to drive change without an understanding of the market, budgets and organisational culture is a potential disaster.

However, I did see some of the more toxic aspects of such culture (a dress code, restrictions on work from home, bell curve stack ranking, a large and unwieldy middle management ..) get changed around and that must be seen as a net positive for a company as such.

SAP had and still has a substantial services arm and was never purely a product company, so I am not even sure Sikka could be seen as a totally new entrant to the industry like if an automotive or Bank CEO had been given the role.

In any case I hope this infighting ends and there emerges a leadership with the backing of the board and major shareholders so there are no future political distractions.

[AMG Power]

Far from being net positive the exercise of undoing Sikka's moves and cleaning up the mess he's left behind is going to take a toll on Infosys and Nilekani - sending out the top heavy recruits from SAP / wiggling out of the Panaya mess and finding out who or what's involved / reducing salaries hiked by 600% back to square one or giving them a golden handshake if they don't agree / cleaning up a lot of the Board members who have had their backs scratched - the list goes on.

All of this would just be the firefighting bits, Nilekani has also got to actually run the company and improve top and bottom lines.

It's going to take all of his skills but with support from current promoters and with the FI's also batting for Nilekani now he might just be able to pull it off.

[hserus]

This Reuters article lists what must happen -

https://www.zawya.com/mena/en/story/...0170823042528/

1. Streamline - remove the "too many leaders" structure present currently.

2. Strong outside CEO - the reporter is not too enthused by the Nilekani suggestion, citing examples where it worked (eg: Apple with Jobs) and others where it didn't.

3. Make the Gibson Dunn report public in the interests of transparency <- This I agree with 100%.

[AMG Power]

Under what circumstances would a news reporter become a management expert even if he's from Reuters? That is, at best, his views a few bits of which might be relevant.

It's great to say "outside CEO" as if a whole bunch of fantastic CEO's are lining up outside Infy's door.

And who would do the selection ? The Board who are under a cloud as of now and are partly if not fully responsible for the mess left behind by Sikka?

Infosys doesn't have the luxury of going through the gamble of another outside CEO being found by the "Board".

Seeing how they're managed everything else so far, in all probability it would end up being Sikka v2.0.

[hserus]

I agree with you they have a Hobson’s choice here. Nilekani (frankly unsuitable) or an outside CEO (most likely reluctant to take up the role given recent history and who will still face cultural and other issues as described earlier in the thread)

This does not make me sanguine. Especially when we are looking at a full board realignment as well, whatever happens.