Strategic Analysis Report of Infosys

Submitted To: Professor K. Rangarajan, Indian Institute of Foreign Trade Submitted By: Naveen Kumar, Roll No 27, PGDIBS01, 2011-12

1. Overview
Infosys Limited (NASDAQ: INFY) was started in 1981 by seven people with US$ 250. Today, we are a global leader in the "next generation" of IT and consulting with revenues of US$ 6.994 billion (FY12). Many of the worlds most successful organizations rely on Infosys to deliver measurable business value. Infosys provides business consulting, technology, engineering and outsourcing services to help clients in over 30 countries build tomorrows enterprise. Our award-winning Infosys Labs and its breakthrough intellectual property can be leveraged as a co-creation engine to accelerate innovation across the enterprise. Infosys pioneered the Global Delivery Model (GDM), based on the principle of taking work to the location where the best talent is available, where it makes the best economic sense, with the least amount of acceptable risk. Continued leadership around GDM enables Infosys to drive extraordinary efficiencies and free up clients resources for strategic transformation or innovation initiatives. Infosys has a global footprint with 65 offices and 74 development centers in US, India, China, Australia, Japan, Middle East, UK, Germany, France, Switzerland, Netherlands, Poland, Canada and many other countries. Infosys and its subsidiaries have 149,994 employees as on March 31, 2012. Infosys takes pride in building strategic long-term client relationships. 97.8% of our revenues come from existing customers (FY 12). Infosys gives back to the community through the Infosys Foundation that funds learning and education.

2. Delivering Business Value

Infosys helps companies derive the measurable business value that they have always been looking for from business and IT investments. We deliver measurable business value in 3 ways: Transform We can transform the fundamental shape of your business P&L. Regardless of which team you engage with, we have a best-practice process for delivering value. We call it IMPACT to ensure a clear line of sight from process change to bottom-line impact, ensuring that you receive the business value you were promised. Optimize Beyond transformation and innovation, it boils down to execution - delivering on time, on budget and "on value". We can optimize your core operations to drive best-in-class efficiency and help fund the transformation and innovation. Innovate We can inject a level of product and service innovation into your business to create new revenue opportunities through collaboration and co-creation. We keep abreast of the latest technology and how it applies to your business issues. What you get from us is best-of-breed solutions. The foundation of our innovation capability is our core lab network Infosys Labs and the new thinking that our team of over 600 researchers brings to the table.

3. Infosys Mission and Values

Vision "We will be a globally respected corporation." Mission "Strategic Partnerships for Building Tomorrows Enterprise." Values We believe that the softest pillow is a clear conscience. The values that drive us underscore our commitment to:

CLIFE - Shared Values Client Value: To surpass client expectations consistently Leadership by Example: To set standards in our business and transactions and be an exemplar for the industry and ourselves Integrity and Transparency: To be ethical, sincere and open in all our transactions Fairness: To be objective and transaction-oriented, and thereby earn trust and respect Excellence: To strive relentlessly, constantly improve ourselves, our teams, our services and products to become the best

4. Fact File
Infosys Limited (NASDAQ: INFY) delivers IT-enabled business solutions to enable Global 2000 companies to build their enterprises of tomorrow. Our solutions focus on providing strategic differentiation and operational superiority to clients. We leverage our domain and business expertise along with a complete range of services. With Infosys, clients are assured of a transparent business partner, world-class processes, speed of execution and the power to stretch their IT budget by leveraging the Global Delivery Model that Infosys pioneered. Infosys has a global footprint with sales offices in 29 countries and development centers in India, US, China, Australia, UK, Canada, Japan and many other countries. Infosys has over 149,994 employees of 89 nationalities.

Key Facts

5. Revenue Segmentations:

6. Organizational Structure After Reorganization Structure in June,2011, Infosys is now organized into four industry sector units: FSI Financial Services and Insurance MFG Manufacturing ECS Energy, Utilities, Communication and Services RCL Retail, Consumer Product Group, Logistics and Life Sciences To complement the new business unit structure, Infosys has consolidated its service lines and solutions into three Service and Innovation Groups: 1. Consulting and Systems Integration 2. Business Operations Services

3. Products, Platforms and Solutions

7. Corporate Governance
Corporate governance is about maximizing shareholder value legally, ethically and on a sustainable basis, while ensuring fairness to every stakeholder - our customers, employees, investors, vendor-partners, the governments of the countries in which we operate, and the community. Thus, corporate governance is a reflection of our culture, policies, our relationship with stakeholders and our commitment to values. We believe that sound corporate governance is critical to enhance and retain investor trust. Accordingly, we always seek to ensure that we attain our performance rules with integrity. Our Board exercises its fiduciary responsibilities in the widest sense of the term. Our disclosures always seek to attain the best practices in international corporate governance. We also endeavor to enhance long-term shareholder value and respect minority rights in all our business decisions. We continue to be a pioneer in benchmarking our corporate governance policies with the best in the world. Our efforts are widely recognized by investors in India and abroad. We have undergone the corporate governance audit by ICRA and CRISIL. ICRA has rated our corporate governance practices at CGR 1. CRISIL has assigned CRISIL GVC Level 1 rating to us. We have complied with the recommendations of the Narayana Murthy Committee on Corporate Governance constituted by the Securities and Exchange Board of India (SEBI). Corporate Governance Philosophy Our corporate governance philosophy is based on the following principles:

Satisfy the spirit of the law and not just the letter of the law Corporate governance standards should go beyond the law

Be transparent and maintain a high degree of disclosure levels When in doubt, disclose Make a clear distinction between personal conveniences and corporate resources Communicate externally, in a truthful manner, about how the Company is run internally Comply with the laws in all the countries in which the Company operates Have a simple and transparent corporate structure driven solely by business needs Management is the trustee of the shareholders' capital and not the own

8. Board composition
At the core of our corporate governance practice is the Board, which oversees how the management serves and protects the long-term interests of all our stakeholders. We believe that an active, well-informed and independent Board is necessary to ensure the highest standards of corporate governance. The majority of the Board, eight out of 15, are independent members. Further, we have audit, compensation, investor grievance, nominations and risk management committees, which comprise independent directors. As a part of our commitment to follow global best practices, we comply with the Euroshareholders Corporate Governance Guidelines 2000, and the recommendations of the Conference Board Commission on Public Trusts and Private Enterprises in the U.S. We also adhere to the UN Global Compact Program.

9. Infosys 3.0 Business and Corporate Strategies

Focus on Business Operations, Business Transformation and Business Innovation Focus on four large verticals FSI Financial Services and Insurance MFG Manufacturing ECS Energy, Utilities, Communication and Services RCL Retail, Consumer Product Group, Logistics and Life Sciences Building an agile organization more tuned towards customers with greater focus on innovation

Infosys seek to further strengthen its position as a leading global technology services company by successfully differentiating its service offerings and increasing the scale of its operations. To achieve these goals, Infosys seek to: Increase business from existing and new clients Expand geographically Continue to invest in infrastructure and employees Continue to enhance Infosys engagement models and offerings

Continue to develop deep industry knowledge Enhance brand visibility Pursue alliances and strategic acquisitions

10.Strengths and Weaknesses:

We believe our competitive strengths include: Leadership in sophisticated solutions that enable our clients to optimize the efficiency of their business.

Proven Global Delivery Model. Commitment to superior quality and process execution Strong brand and long standing client relationships Status as an employer of choice Ability to scale. Innovation and leadership

11. Opportunities and Threats:

The following broad categories of risks have been considered in our risk management framework. 1. Strategy: Risks emanating out of the choices we make on markets, resources and delivery model which can potentially impact our long-term competitive advantage. 2. Industry: Risks relating to inherent characteristics of our industry including, competitive structure, technological landscape, extent of linkage to economic environment and regulatory structure. 3. Counterparty: Risks arising from our association with entities for conducting business. These include clients, vendors, alliance partners and their respective industries. 4. Resources: Risks arising from inappropriate sourcing or sub-optimal utilization of key organizational resources such as talent, capital and infrastructure. 5. Operations: Risks inherent to business operations including those relating to client acquisition, service delivery to clients, business support activities, information security, intellectual property physical security and business activity disruptions. 6. Regulations and compliance: Risks due to inadequate compliance to regulations, contractual obligations and intellectual property violations leading to litigation and loss of reputation.

12. Competition:
We operate in a highly competitive and rapidly changing market and compete with consulting firms such as Accenture Limited, Atos Origin S.A., Capgemini S.A. and Deloitte Consulting LLP, Divisions of large and multinational technology firms such as Hewlett-Packard Company and International Business Machines Corporation; IT outsourcing firms such as Computer Sciences, Kean Inc., Logica Plc and Dell Perot Systems ,Offshore technology services such as Cognizant Technology Solutions, Tata Consultancy Services Limited and Wipro Technologies Limited., software firms such as Oracle Corporation and SAP A.G.; business process outsourcing firms such as Genpact Limited and WNS Global Services and in-house IT departments of large corporations.

In the future, we expect competition from firms establishing and building their offshore presence and firms in countries with lower personnel costs than those prevailing in India. However, we recognize that price alone cannot constitute a sustainable competitive advantage. We believe that the principal competitive factors in our business include the ability to effectively integrate onsite and offshore execution capabilities to deliver seamless , scalable, cost-effective services, increase scale and breadth of service offerings to provide onestop solutions, provide industry expertise to clients business solutions, attract and retain high quality technology professionals and maintain financial strength to make strategic investments in human resources and physical infrastructure through business cycles. We believe we complete favorably with respect to those factors.

13. Infosys Global Supply Chain Framework

14. Recommendations:
1. Strong Focus on Product Related Diversification 2. Provide more high- end services in value chain. 3. Focus on Quality with low cost of quality. 4. Consolidation and strategic acquisitions are essentially good for future growth.

15. References:
1. Infosys Annual Reports 2010-2011. 2. www.Infosys.com 3. www.nasscom.org and www.nasscom.in 4.Infosys research report form www.infosys.com

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