Daunting task for Infosys Board to find new CEO: Jefferies

“Given the acrimonious exit (of Sikka), the near-term challenge for the Infosys Board would be to find the right candidate for the CEO post and alleviate issues with the company’s founder (Narayan Murthy),” Jefferies Indian arm said. As the company’s strategic direction was not in question, the securities firm said the IT major would sustain business momentum. 

“Interim challenges will also involve business continuity, especially with large clients, and preventing attrition in senior management and sales,” said Jefferies India equity analyst Vaibhav Dhasmana. As finding closure to the “founder issues” and maintaining business traction, especially in large accounts, would not be easy, Dhasmana said that, over the long-term, the Board had to create mechanisms to shield the management from external noise as had been the case with Sikka. 

Though Sikka resigned citing personal attacks, the Board blamed comments from one of the founders (Murthy) as reason for his exit. 

With the company hinting at a strong second quarter (July-September) and reiterating its annual guidance for fiscal 2017-18, the management is expected to meet its top 100 clients in the next few weeks. The outsourcing firm appointed COO UB Pravin Rao as the interim CEO until a new CEO is found by March 31, 2018, and elevated Sikka as Executive VC to ease the transition. “In the backdrop of industry changes and slowing growth across the sector, the time taken for resolution of these, especially the new CEO appointment, will be key, added Dhasmana.