Sunday, August 26, 2007

Interview with Mr Narayan Murthy

The following is an interview that Rahul and I had with Mr Narayan Murthy on 23rd Aug 2007 at Infosys Campus, Electronic City, Bangalore.
Pictures are available here

Rahul: Creating a small organization and then transforming it into a world class organization like Infosys could not have been a dream. Was it destiny?

NRN: No, it is not destiny because at the end of the day, God helps those who help themselves. Fortune favors the prepared mind. In that sense, it was clearly luck, there is no doubt at all. But at the same time, it was also the result of a set of policies. For example, right from day 1, we said we would seek respect, respect from customers, respect from employees, respect from investors, respect from venture partners, respect from government of the land and society. So because we had that very clear objective, we conducted ourselves in a manner that more and more customers were happy with us, more and investors were happy, good employees came to us etc. So in that sense, it was not so much destiny. There was a lot of hard work. We were ready. Again somebody said, when God is shy to announce his presence in person he comes in the form of chance.

Rahul: Sitting in a position of power, where you could stir a nation, you decided to retire. Was it the characteristic of a normal person or are you something special?

NRN: No. Right from the beginning, we have always believed that youngsters should get more and more opportunities, at a time, at an age when they are energetic and enthusiastic to take those responsibilities. I said I have to set an example to create an opportunity for a younger person. So now Mr Nandan Nilekani has done it. Mr Mohandas Pai has done it. When he was voted India’s number 1 CFO at the age of 45 or so, he gave it up in favor of someone who was 36. He said that ‘I have done this for 12 years, now let him do’. So I think it is a culture. That culture has to be nourished in India; because here we have 75 year old, 80 year old people, hanging onto their jobs, which is not good because youngsters should get opportunity.

Imagine… when Rajiv Gandhi was the prime minister, the fact that he was a young man, there was so much of confidence in the country. So I think it is very important to change over.

Rahul: God forbid, tomorrow if we hear Infosys is in losses, losing clients, how will react? Will you be coming back?

NRN: No, not really. Even today, I add value to the company, though I am the non-executive chairman now. I add value to the company in so far as they want me to add value. If they ask, I will certainly be there. Even today, all major decisions, they are discussed, they are debated, I give my point of view. I have been and will continue to add value wherever they ask me to. While I won’t impose my views on others, if they ask, then certainly I will.

Rahul: Do you think entrepreneurship is an attitude which can be developed or is it in born?

NRN: Entrepreneurship can be developed; there is no doubt about it. As long as you put in the required enthusiasm and hard work, as long as you put in good ideas whose value can be expressed in a simple sentence; as long as you are willing to make short term sacrifices, certainly it can is possible. It can be developed.

Rahul: How can B-Schools develop this? Now-a-days B-Schools have the best minds, how can they act to develop these entrepreneurship skills rather than acting like mere placement agencies?

NRN: Well, entrepreneurship as I said is about converting ideas into wealth, ideas into jobs. If you want to do that, you will need an idea whose value to the market can be expressed in a simple sentence; not a complex sentence, not a compound sentence. Either it reduces cost, increases productivity, reduces cycle time, improves customer base, enhances comfort, etc.

Second, you need a team which brings complementary strengths.

Third, you need an enduring value system.

Then of course you need finance.

So B-Schools will have to train their students in seeing opportunities for improving any one of these attributes like reducing costs or improving cycle time, in everything they see and to express that in a simple sentence. Second, they can teach people to work in teams; how to subordinate their ego, how to appreciate good things in others, how to become more open-minded, how to put the interests of the team ahead of their own personal interests, by case studies, by role models, by examples etc.

Then I think value systems are not easy to teach. But by bringing case studies and role models in flesh and blood to the schools, by these role models talking about their experiences, on how they stuck to the value system and eventually benefitted, I think the youngsters would be inspired and they too would use the value system. And then of course, B-Schools can bring venture capitalists, the VCs can talk about what kind of financing is available, how they evaluate ideas, etc. So certainly, B-Schools can add value to entrepreneurship

Rahul: Why do you think the Indian youth should think of entrepreneurship as a serious career option?

NRN: India is a very poor country. We have a billion-plus people. A large percentage of our people are unemployed. The only way we can solve poverty in this country is by creating jobs, jobs with good disposable income. That’s where entrepreneurship is extremely important.

Clinton: Sir, do you value entrepreneurship inside your own company? You did say that young people should get opportunities. So do you believe that if you encourage entrepreneurship culture inside an organization like Infosys, Infosys itself would grow?

NRN: Remember that I said entrepreneurship is all about ideas that bring value to the market. In our case, every one of us is encouraged to think in terms of improving speed, bringing in better ideas to the table, enhancing excellence in execution. So as long as our youngsters do this, they are indeed entrepreneurship in some sense. Entrepreneurship in some sense does not necessarily mean that you always have to form a new company. Entrepreneurship is all about bringing the power of ideas and converting them into a larger number of jobs, into wealth. So if all of us bring good ideas to the table, and the company becomes stronger, we are all better off. We will be able to recruit more and more people; we will have better salaries, better compensation for all of us. So there is a role of entrepreneurship inside a large corporation too. Some people call it intrapreneurship. It is a mindset.

Clinton: When you start off as an individual starting an organization all by itself and when you are working inside an organization doing intrapreneurship, there is still a difference. For example, an entrepreneurship has to take a huge amount of risk and should be able to see the future and recover from any failure that can happen in the future; whereas, the intrapreneur does not have to face such risks. So doesn’t entrepreneurship require much more capabilities and skills from the individual?

NRN: Not much more capabilities, because even in Infosys, a person takes up a fairly big project. If that project succeeds, his or her future may not be as rosy as somebody else’s. There is a certain risk taken. But it’s all about a mindset. Certainly I agree with you, if you are not sure whether you will be able to put food on the table for you and your family tomorrow, that’s certainly a much more daunting challenge than perhaps not getting a promotion. But still it is a question of mindset. A question that says what new ideas can I bring to the table so that it is a better world. Some say that is entrepreneurship; though the risk factors in a large organization are lower compared to a startup.

Clinton: Sir, besides these four main items that you mentioned, ideas, a good team, an enduring value system and finance, what other skills do you think an entrepreneur should be building?

NRN: Obviously, passion, hard work, optimism, ability to sacrifice short term interests for long term, ability to lead people, these are all major too.

Rahul: Sir, you have affected the life of lakhs of Indians in a very positive way. But India needs more Narayan Murthy’s like you. You have reached the pinnacle of success. Are you planning to do anything to create more Narayan Murthy’s?

NRN: No, not really, but certainly I think there are many suggestions that say that maybe I should look at becoming a venture capitalist, not so much to make more money but to encourage more youngsters. I think that is one thing that maybe I should look at. Second I think at I get probably 10 – 15 emails a week from youngsters who want to become entrepreneurs. I take time off and give my views. Third I go and speak to probably hundreds and thousands of youngsters every year in different towns and cities; I talk to them about how we are at a very historic time in this country; how never before in the last 300 years Indians received respect, Indians received attention like they are receiving today. So you are born at a wonderful time wherein you can take advantage of it, you can consolidate it. So I give a lot of pep talks.

Clinton: Besides the pharma , the retail and the telecom sector, which are the areas you think that entrepreneurship should be putting their money in the next 10 years?

NRN: In this country there is opportunity in almost everything because we are still not as well developed as the developed nations. We have lot of opportunities in infrastructure; power, airports, roads, ports, schools, hospitals, food, food preservation. For example, in this country so much of food grains are lost; 30-35% is lost, eaten by rodents, so if we can save that we are so much better. Similarly, we need micro-insurance, we need to take advantage of the latest technologies. Biotechnology is a great instrument, particularly in agriculture, in pharmaceuticals. Nano-technology is another field where there will be wonderful opportunities in the next 10 years. Then of course there is IT. It offers considerable opportunities. So I would say in India there are so many areas where there are opportunities. The only issue is that Government should become a catalyst rather than being an impeding force. Unfortunately, the tendency in India is that wherever there is an interface with Government, there is a lot of friction, there are a lot of problems. So as long as our political leaders and bureaucrats understand it, our youngsters will create so many jobs, so much of wealth, this country will become a better place. But otherwise it is going to become difficult.

Rahul: Humility and sensitivity to the society – is it a precursor to be a successful entrepreneur or is the result of being a successful entrepreneur?

NRN: I think humility is very important because if you are not humble, you are not open to new ideas, you will not learn many things. Humility means you can subordinate your ego. If you subordinate your ego it means you can work in a team better. Humility also helps you to accept setbacks and still keep up that optimism. Whereas if you think you are the smartest guy, you are the last word in the world, then you will not accept setbacks.

Sensitivity to society is very important for every human being whether he or she is an entrepreneurship or not. But at the end of the day when you have been successful, you have to have sensitivity to society. At the end of the day, how much food can you eat, how much cars can you have, how many houses can you buy? If you are amongst the people who are happy, who are healthy, then you feel so much better; because I often define success as, if your eyes light up when you meet other people, and their eyes light up when they meet you then you are a success. So if that is indeed the definition of success, then being sensitive to the problems of the society is what will make you a successful person. Because people will be happy to meet you and you will be happy to meet people. So ultimately that is the most important thing.

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