When Phaneesh Murthy took over as the chief executive officer of iGATE Global Solutions in August 2003, it was a loss-making company. Today, iGate has 37 per cent gross margins.
In this interview, Phaneesh Murthy talks about how he managed the turn around, and also about the global economic scenario and the future of outsourcing.
When you took over iGATE, it was a loss-making company. Now it is a profitable one. You took Infosys from $2 mn to $700 mn. What is your success mantra? Any magic wand?
I don’t think there is any magic wand. It is about working hard, staying focussed and the ability to execute well on certain objectives and initiatives.
iGATE was -8%(negative) profits when I took over and it was not in good shape. I took five major transformations. When I look back, I am quite surprised at the courage of taking on five such major transformations at the same time.
Sometimes when you are pushed against the wall, there are no choices; it makes decision-making a lot easier. Sometimes when things are going well, you don’t undertake the transformations because you think it has risks and danger.
What was in your mind when took over at iGATE in 2003?
My own philosophy in life is that you should have varied experiences. The first experience I had was a very clean company and just growth.
It’s always good to round off an experience of fixing a broken company. I looked at it as a very different kind of experience.
I am quite pleased with the results and outcome. The fact is that we are now 37 per cent gross margins, which is very close to the best-in-class kind of companies. Our operating margins are also among the best in the mid-size sector. Our multiples are probably among the highest in the mid-sized sector and close to the larger companies.
When did you realize that you will be able to turn iGate around?
I always had a lot of confidence in myself. I am one of those eternal optimists. I am one of the kind of people, who, very likely if I fall from a 60-floor building, after 55 floors, I will probably say, ‘so far so good.’
When I started at iGATE, I was quite confident that I would be able to turn it around.
I had severe challenges in the first 6-8 months. From an external point of view, there was a GE contract, which was roughly 45 per cent of revenues, which had to be renewed within three months. That was a big challenge.
Text: Shobha Warrier
Image: iGate CEO Phaneesh Murthy. | Photograph: Sreeram Selvaraj
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