TITLE INFOSYS SUBJECT BUSINESS POLICY AND AN D STRATEGIC STRATEGIC MANAGEMENT
INDIAN IT INDUSTRY – OVERVIEW INTRODUCTION In an increasingly globalised world, signifcant complexity and uncertainty is getting attached to the unprecedented economic crisis. The Indian economy has also been impacted by the recessionary trends, with a slowdown in GDP growth to seven per cent. The ocus and exponential growth in the domestic maret has partially o!set this all and insulated the country, resulting in net overall momentum. The IT"#P$ IT"#P$ industry in India has today become a growth engine or the economy, contributing substantially to increases in the GDP, urban employment and exports, to achieve the vision o a %young and resilient& India. During the year, the sector maintained its double digit growth rate and was a net hirer. hirer. This growth has been bee n ueled by increasing i!ersi"ca#i$n in #%e ge$gra&%ic 'ase an in(s#r) !er#ica*s, and aa&#a#i$n in #%e ser!ice $+erings &$r#,$*i$- 'hile the e!ects o the economic crisis are expected to linger in the t he near term te rm uture, the Indian IT"#P$ IT"#P$ industry has displayed resilience and tenacity in countering the unpredictable conditions and reiterating the viability o India(s undamental value proposition. )onse*uently, India has retained its leadership position in the global sourcing maret. The Indian IT"#P$ IT"#P$ industry is estimated to achieve revenues o +D -.- billion in /01223,
INDIAN IT INDUSTRY – OVERVIEW INTRODUCTION In an increasingly globalised world, signifcant complexity and uncertainty is getting attached to the unprecedented economic crisis. The Indian economy has also been impacted by the recessionary trends, with a slowdown in GDP growth to seven per cent. The ocus and exponential growth in the domestic maret has partially o!set this all and insulated the country, resulting in net overall momentum. The IT"#P$ IT"#P$ industry in India has today become a growth engine or the economy, contributing substantially to increases in the GDP, urban employment and exports, to achieve the vision o a %young and resilient& India. During the year, the sector maintained its double digit growth rate and was a net hirer. hirer. This growth has been bee n ueled by increasing i!ersi"ca#i$n in #%e ge$gra&%ic 'ase an in(s#r) !er#ica*s, and aa&#a#i$n in #%e ser!ice $+erings &$r#,$*i$- 'hile the e!ects o the economic crisis are expected to linger in the t he near term te rm uture, the Indian IT"#P$ IT"#P$ industry has displayed resilience and tenacity in countering the unpredictable conditions and reiterating the viability o India(s undamental value proposition. )onse*uently, India has retained its leadership position in the global sourcing maret. The Indian IT"#P$ IT"#P$ industry is estimated to achieve revenues o +D -.- billion in /01223,
with the IT sotware and services industry accounting or +D 42 billion o revenues. During this period, direct employment is expected to reach nearly 1.15 million, an addition o 114,222 employees, while indirect 6ob creation is estimated to touch 7 million. 8s a proportion o national GDP, the sector revenues have grown rom .1 per cent in /0337 to an estimated 9.7 per cent in /01223. otware and services exports :including #P$; are expected to account or over 33 per cent o total exports, employing over .-4 million employees. 'hile the t he current mood is that o %cautious optimism,& the industry is expected to witness sustainable growth over a two"year hori
INFOSYS VISION >To be a globally respected corporation that provides best"o" breed business solutions, leveraging technology, delivered by best"in"class people.>
MISSION >To >To achieve our ob6ectives in an environment o airness, honesty, and courtesy towards our clients, employees, vendors and society at large.>
POLICIES OF INFOSYS I?T@$D+)TI$? This Code of Business Conduct and Ethics helps ensure compliance with legal requirements and our standards of business conduct. All Company employees and trainees are expected to read and understand this Code of Business Conduct and Ethics, uphold these standards in day-to-day actiities, comply with all applicable policies and procedures, and ensure that all agents and contractors are aware of, understand and adhere to these standards. Because the principles described in this Code of Business Conduct and Ethics are general in nature, you should also reiew all applicable Company policies and procedures and the Employee !andboo", when adopted for your location for more specific instruction. #ou can also contact the !uman $esources %epartment or &egal %epartment if you hae any questions. 'othing in this Code of Business Conduct and Ethics, in any company policies and procedures or in other related communications (erbal or written) shall constitute and shall not be construed to constitute a contract of employment for a definite term or a guarantee of confirmed employment. *e are committed to continuously reiewing and updating our policies and procedures. Therefore, this Code of Business Conduct and Ethics is sub+ect to modification. This Code of Business Conduct and Ethics supersedes all other such codes, policies, procedures, instructions, practices, rules or written or erbal representations to the extent they are inconsistent. The Company may update the code from time to time. lease sign the ac"nowledgment form at the end of this Code of Business Conduct and Ethics and return the form to the !uman $esources %epartment indicating that you hae receied, read, understand and agree to comply with the Code of Business Conduct and Ethics. The signed ac"nowledgment form will be located in your personnel file. Each year as part of your annual reiew you will be as"ed to sign an ac"nowledgment indicating your continued understanding of the Code of Business Conduct and Ethics.
YOUR RESPONSIBILITIES TO T.E COMPANY AND ITS STOC/.OLDERS A- Genera* S#anars $, C$n(c# The )ompany expects all employees, agents and contractors to exercise good 6udgment to ensure the saety and welare o employees, agents and contractors and to maintain a cooperative, eAcient, positive, harmonious and productive wor environment and business organi
A0- W$r1&*ace ,ree $, .arass2en# The )ompany is committed to providing a wor environment ree o unlawul harassment. )ompany policy prohibits sexual harassment and harassment based on pregnancy, childbirth or related medical conditions, race, religious creed, color, national origin or ancestry, physical or mental disability, medical condition, marital status, age, sexual orientation, or any other basis protected by ederal, state, or local law or ordinance or regulation. 8ll such harassment is unlawul. The )ompanyBs anti"harassment policy applies to all persons involved in the operation o the )ompany and prohibits unlawul harassment by any employee o the )ompany towards other Inosys employees including supervisors, outside vendors, clients,. It also prohibits unlawul harassment based on the perception that anyone has any o those characteristics, or is associated with a person who has or is
perceived as having any o those characteristics. I you believe that you have been unlawully harassed, submit a complaint to your own or any other company supervisor. In addition, i you believe you have been sexually harassed, you can submit a complaint to the Grievance @edress #ody o the )ompany.
A3- Dr(g an A*c$%$* A'(se To meet our responsibilities to employees, customers and investors, the )ompany must maintain a healthy and productive wor environment. isusing controlled substances, or selling, manuacturing, distributing, possessing, using or being under the inEuence o illegal drugs and alcohol on the 6ob is absolutely prohibited.
A4- Sa,e#) in W$r1&*ace The saety o people in the 'orplace is a primary concern o the )ompany. Cach o us must comply with all applicable health and saety policies. 'e maintain compliance with all local laws to help maintain secure and healthy wor surroundings. Fuestions about these laws and guidelines should be directed to the =uman @esources Department.
A5- Dress C$e an $#%er &ers$na* s#anars #ecause each o us is a representative o the )ompany in the eyes o the public, we must report to wor properly groomed and wearing appropriate clothing. Cmployees are expected to dress neatly and in a manner consistent with the nature o the wor perormed.
A6- E7&ense C*ai2s 8ll business related expense claims must be authori
B- A&&*ica'*e La8s
8ll )ompany employees, agents and contractors must comply with all applicable laws, regulations, rules and regulatory orders. Cach employee, agent and contractor must ac*uire appropriate nowledge o the re*uirements relating to his or her duties suAcient to enable him or her to recogni
C-
C$r&$ra#e O&&$r#(ni#ies
Cmployees, oAcers and directors may not exploit or their own personal gain opportunities that are discovered through the use o corporate property.
D- Pr$#ec#ing #%e C$2&an)9s C$n"en#ia* In,$r2a#i$n The )ompanyHs confdential inormation is a valuable asset.The )ompanyBs confdential inormation includes product architectures source codes product plans and road maps names and lists o customers, dealers, and employees and fnancial inormation. This inormation is the property o the )ompany and may be protected by patent, trademar, copyright and trade secret laws. 8ll confdential inormation must be used or )ompany business purposes only. Cvery employee, agent and contractor must saeguard it. This responsibility includes not disclosing the )ompany confdential inormation such as inormation regarding the )ompanyHs services or business over the internet.
RESPONSIBILITIES TO OUR CUSTOMERS AND OUR SUPPLIERS 8. )ustomer @elationships f your +ob puts you in contact with any Company customers or potential customers, it is critical for you to remember that you represent the Company to the people with whom you are dealing. Act in a manner that creates alue for our customers and helps to build a relationship based upon trust. The Company and its employees hae proided serices for many years and hae built up significant goodwill oer that time. This goodwill is one of our most important assets, and the Company employees, agents and contractors must act to presere and enhance our reputation.
#. Payments or Gits rom $thers ifts gien by the Company to suppliers or customers or receied from suppliers or customers should always be appropriate to the circumstances and should neer be of a "ind that could create an appearance of impropriety. The nature and cost must always be accurately recorded in the Company/s boo"s and records. lease follow the Company0s ift olicy in this regard.
). Publications o $thers The Company subscribes to many publications that help employees do their +obs better. These include newsletters, reference wor"s, online reference serices, maga1ines, boo"s, and other digital and printed wor"s. Copyright law generally protects these wor"s, and their unauthori1ed copying and distribution constitute copyright infringement. #ou must first obtain the consent of the publisher of a publication before copying publications or significant parts of them. *hen in doubt about whether you may copy a publication, consult the &egal %epartment.
D. /ree and /air )ompetition 2ost countries hae well-deeloped bodies of law designed to encourage and protect free and fair competition. The Company is committed to obeying both the letter and spirit of these laws. The consequences of n ot doing so can be seere for all of us. These laws often regulate the Company/s relationships with its distributors, resellers, dealers, and customers. Competition laws generally address the following areas3 pricing practices (including price discrimination), discounting, terms of sale, credit terms, promotional allowances, secret rebates, exclusie dealerships or distributorships, product bundling, restrictions on carrying competing products, termination, and many other practices.
SWOT ANALYSIS OF INFOSYS STRENTG.S C$s# a!an#age J most fnancially attractive country in a study by 8 T Kearney on global IT destinations Brea#% $, ser!ice $+ering – end to end solutions including high end services lie IT consultancy and KP$ Ease $, sca*a'i*i#) – more than hal o India(s population is less than 19 years old. Cnglish speaing IT J ITC proessionals growing at a good pace :(a*i#) an 2a#(ri#) $, &r$cess – many players have *uality standards such as ) to di!erentiate rom other low cost advantage countries
G*$'a* an 35;< e*i!er) ca&a'i*i#) – excellent internet bacbone and telecommunications acilities enabling companies to develop 1LM- delivery capabilities rom India itsel
WEA/NESSES E7cessi!e e&enence $n USA ,$r re!en(es J + )ompanies are cutting down IT budget hence revenues to be hit hard o Indian IT frms E7cessi!e e&enence $n BFSI sec#$r ,$r re!en(es J #aning sector is acing a crisis globally and is going to spend less on IT .ig% ra#es $, a##ri#i$n J 8lthough slowdown in global economy has lowered attrition rate but the industry still aces high attrition rates as compared to other sectors Decreasing c$2&e#i#i!e a!an#age J rising salary expenses is taing away the cost advantage en6oyed by India.
OPPORTUNITIES Greater scope or product innovation Increased ocus on high end wor lie consulting and KP$ Domestic demand or IT services is to grow at 12 N Greater scope to service domains other than #/I such as Transportation, Inrastructure, etc. atyam fasco J iely to have positive impact on business considering corporate governance, possibility o shiting o business, getting higher incremental business rom overlapped clients, and winning new business rom new clients.
T.REATS
Global economic slowdown may continue or several years J hence low IT spending globally + Govt. against outsourcing hrining margins due to rising wage inEation @upee"dollar movement a!ects revenue and hence margins Increased competition rom oreign frms lie 8ccenture, I# etc. Increased competition rom low"wage countries lie )hina, Indonesia etc.
PESTLE ANALYSIS OF INFOSYS POLITICAL P$*i#ica* s#a'i*i#)= Indian political structure is considered stable enough expect the act that there is a ear o Ohung parliament( :no clear ma6ority;. +.. government has declared that +. companies that outsource IT wor to other locations other than U-S- 8i** n$# ge# #a7 'ene"#. Government owned companies and P+s have decided to give 2$re IT &r$>ec#s #$ Inian IT c$2&aniesTerr$ris# a##ac1 $r 8ar-
ECONOMIC Global IT spending :demand; D$2es#ic IT S&ening :Demand;Doemestic maret to grow by 12N and reach approx +D 12 billion in 1227"23 " ?8)$ C(rrenc) F*(c#(a#i$n Rea* Es#a#e Prices Decline in real estate prices has resulted reducing the rental expenditures. A##ri#i$n= Due to recession, the layo!s and 6ob"cuts have resulted in low attrition rate. ECOMONIC ATTRACTIVENESS due to cost advantage and other actors.
SOCIAL Lang(age s&$1en= Cnglish is widely spoen language in India, Cnglish medium being the most accepted medium o education. Thus, India boasts o large Cnglish speaing population. E(ca#i$n= 8 number o technical institutes and universities over the country o!er IT education. W$r1ing age &$&(*a#i$n
TEC.NOLOGY Te*e&%$n) India has the worldBs lowest call rates :"1 + cents;. Cxpected to have total subscriber base o about 922 million by 122. 8@P+ or G is +D 4.4 per month. India has the second largest telephone networ ater china. Teledensity J 3.74 N Cnterprise telephone services, 5G, 'i"max and QP? are poised to grow.
In#erne# Bac1'$ne= Due to IT revolution o O32s, Indian cities and India is well connected with undersea optical cables. Ne8 IT #ec%n$*$gies= Technologies lie $8, 'eb 1.2, =igh"defnition content, grid computing, etc and innovation in low cost technologies is presenting new challenges and opportunities or Indian IT industry.
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MAR/ET PENETRATION STRATEGY :
C(rren# Mar1e#s +8 and Curope C(rren# Pr$(c#s 8D, #P$, KP$, consultancy services :in #/I, manuacturing and retail; and sotware products :fnancial products;. Rec$22ena#i$n 8s most large clients in + and Curope are cutting costs, Inosys needs to be more aggressive on cost and *uality ront. Res(*# $, s#ra#eg) +nliely to yield good results
MAR/ET DEVELOPMENT STRATEGY Ne8 Mar1e# India, iddle"east and 8ustralia C(rren# Pr$(c# 8D, #P$, KP$, consultancy services :in #/I, manuacturing and retail; and sotware products :fnancial products;. Rec$22ena#i$n ince these are ast developing IT maret, Inosys needs a paradigm shit in ocus rom + and C+ marets to these marets. Res(*# $, s#ra#eg) iely to yield good result.
PRODUCT DEVELOPMENT STRATEGY C(rren# Mar1e# +8 and Curope
Ne8 Pr$(c# )onsultancy and pacage implementation services in relatively growing sectors esp. healthcare, lie sciences and aviation sector, and KP$ services. Rec$22ena#i$n )oncentrate on building expertise in these domains by strategic ac*uisitions. Res(*# $, S#ra#eg) iely to have good result. :better the company ac*uired, the better the result;.
DIVERSIFICATION= Ne8 Mar1e# India, iddle"east and 8ustralia Ne8 &r$(c# )onsultancy and pacage implementation services in relatively growing sectors esp. healthcare, lie sciences and aviation sector, and KP$ services. Rec$22ena#i$n )hanging #rand image rom low value service provider to high value service provider. Res(*# $, S#ra#eg) DiAcult to achieve overnight :possible in long term;
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Le# 2e g$ #%r$(g% eac% $, #%ese < e*e2en#s . Style= Its $rgani
9. Staf= These are RpeopleB within the organi
LEADERS.IP STYLE= Inosys believes that leadership is one o the most essential ingredients o organi
STAFF @.UMAN RESOURCES= ince Inosys is in nowledge"based industry, it ocuses on the *uality o the human resources. $ut o total personnel, about 32 per cent are engineers. 8t the entry level, it emphasi
STRATEGY= Inosys has adopted a client"ocused strategy to achieve growth. @ather than ocusing on numerous small organi
Increase '(siness ,r$2 e7is#ing an ne8 c*ien#s= Inosys has ocused on expanding the nature and scope o engagements or the existing clients by increasing the si
E7&an ge$gra&%ica**)= Inosys plans to establish new sales and mareting oAces, representative oAces and global development centers to expand its geographical reach. It plans to increase presence in )hina through Inosys )hina, in the )
In recent years, it has added ne w service o!erings, such as consulting, business process management, systems integration and inrastructure management, which are ma6or contributors to its growth.
De!e*$& ee& in(s#r) 1n$8*ege= Inosys has speciali
ORGANIATIONAL STRUCTURE= The company has adopted a ,ree ,$r2 $rgania#i$n e!$i $, %ierarc%ies- Cveryone is nown as associates irrespective o his position in the company. otware development is undertaen through teams and the constitution o teams is based on the principle o Eexibility. 8 member, who might have been team leader in one pro6ect, may be replaced by another member o the same team or another pro6ect. This system not only helps in creating the eeling o e*uality but also helps in developing pro6ect leaders.
S/ILLS /rom last year, Inosys has made it mandatory or every employee -uto clear a predefned certifcations, domain as well as technical, in order to be eligible or appraisal. This is 6ust one o the initiatives taen by Inosys which signifes the e!orts taen or building competencies. 8part rom internal initiatives lie nowledge management, Inosys has been )"evel 9 certifed or its process capabilities. Inosys has entered the #alanced corecard =all o /ame or executing trategy or achieving breathrough perormance results using the Ba*ance Sc$recar @BSC-
PORTER?S FIVE FORCES MODEL @INDIAN IT INDUSTRY T%rea# $, S('s#i#(#es= . O#%er $+s%$re *$ca#i$ns such as Castern Curope, the Philippines and )hina, are Bargaining P$8er $, RIVALRY C(s#$2ers= Bargaining &$8er $, emerging and are posing threat AMONG to Indian IT industry because o s(&&*ier= . Large n(2'er $, IT FIRMS= .ig% their cost"advantage. =owever, c$2&anies vying or IT . Due to s*$8$8n #%e this should have an impact . pro6ects J resulting in high >$'c(#s #%e *a)$+s and )ommoditi
#$ En#r)= Hlow"cost, 1. Demand and supply o1.Barriers Price 1.uoted or ro ects is e7&eni#(re= Indian IT sector little" IT proessionals is no is dependent on +8 and #/I ca&i#a* . L$8 di!erentiationH in particular or ma6ority o its longer that avorable to re(ire2en#spositioning. revenues, and with the recent employees. !a*(e c%ain , spacefnancial crisis, the new 1- Large 5. high industry 5. A!ai*a'i*i#) $, !as# spending rom these has or small enterprises. growth #a*en# &$$* J reshers and reduced tremendously. experienced. L. are trong 5. ?)s ramping up 5. =owever, or the existing
S#ra#eg) Iss(e $, #%e In,$s)s 8 business strategy in todayBs ast paced economic environment is a constantly shiting process. To remain competitive, an organi
pacage enterprise application inrastructure must provide a level o adaptability that supports this dynamic course o action. 'hen new business challenges warrant enhancing existing inormation systems, mission"critical pacage enterprise applications must be upgraded to ensure that these business processes will remain consistently lined to customer re*uirements. #eore going ahead on the upgrade path, organi
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The business need that leads to considering an upgrade The need to ully leverage the unctionalities o existing enterprise applications The impact o upgrading the existing enterprise applications on the business processes 'hether the upgrade approach is leading to improved business processes while lowering the operational cost
'ithout analy
around to applying upgrades when their existing applications become unstable, unusable or are de"supported by the product vendor.The upgrade can impact various acets o your organi
I2&ac# $n B(siness S#ra#eg) 'hen basic business processes are altered as the result o ever changing maretMindustry dynamics, the underlying applications that support these processes must change as well. Cnterprise 8pplication upgrade is one such enabler or aligning your application landscape to the changing business needs. /or example, i a manuacturing organi
I2&ac# $n Financia* S#ra#eg) Qery oten enterprise application upgrade initiatives are thought to be one"time M periodic operational expenditure that need to be incurred due to de"support notices rom the product vendors. 8lthough de"support is one o the drivers or an upgrade initiative, there are many ways in which the same can be used as opportunity to align it with the organi
improve their business perormance andmaintain the competitive edge over their competitors. They tae considerable amount o fnancial ris in anticipation o *uicer and higher return on investment.
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I2&ac# $n O&era#i$ns S#ra#eg) In todayBs dynamic business environment, organi
I2&ac# $n IT S#ra#eg) Traditionally upgrade initiatives have been looed as periodic transactional events and are not included as part o the overall IT strategy o the organi
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ost existing solutions or Cnterprise 8pplications upgrades do not incorporate a structured assessment process. There is a lac o comprehensive upgrade planning. +pgrades are points in time o the application liecycle that provide a riendly trigger to enable the organi
I the initial assessments are not ade*uate or rigorous, organi
rather than instruments or planning, executing and stabili
InosysB experience suggests that a ma6or reason why enterprises ail to optimally extract value rom their upgrade initiatives is due to the common misperception that upgrades are not tied to the overall business strategy. #usinesses should adopt a holistic approach or enterprise application upgrade and ensure a long"term ocus on the goals associated with the unctional aspects o the upgrade.
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#ased on its strong industry experience, Inosys eels that organi
0- C%ange Perce&#i$ns= Instead o treating the upgrade as an isolated event, enterprises should view the upgrade process as an integral and ongoing activity that is closely aligned to the business. 8s business re*uirements change, the applications tied to those processes will also need to change and modifcations must be made as re*uired to support the unctional value chain. $rgani
3- Use an (&grae Assess2en#Base A&&r$ac% #$ Crea#e a .$*is#ic (&grae R$a2a&=
#eore conducting a mission"critical application upgrade, enterprises should conduct a comprehensive assessment that includes the fnancial, operational and technical impact existing system landscape. 8ll technical aspects o the application environment should be considered including Inrastructure @e*uirements, )ustomi
S$*(#i$n $, #%e In,$s)s 8 large #elgium"based steel manuacturer had decided to implement a customi
