Career & Success

Infosys Leaders: We Aim to Benefit Stakeholders and Society

Narayana and Sudha Murthy explain that part of their business plan included large-scale job creation in India to help eradicate poverty.

October 01, 2007

| by Marguerite Rigoglioso

In 1974, Narayana Murthy was detained at a railroad station in Bulgaria for almost five days without food and water. His crime? During a train trip he spoke with a local woman about the travails of living in an Iron Curtain country. Throughout that long ordeal, and a subsequent 31-hour freight train ride to Istanbul——similarly, without supplies——the young Indian engineer had a lot of time to rethink his own leftist commitments. As he sat cold and starving, Murthy concluded that entrepreneurship aimed at large-scale job creation was the only viable mechanism for eradicating poverty.

At a special luncheon on October 15 with a group of some 20 MBA students, Murthy shared this story of the genesis of what would eventually become Infosys, his enormously successful global information technology consulting and software services company. As the first Denning Distinguished Fellows in Global Business and the Economy at Stanford GSB, he and his accomplished wife, Sudha Murty, were making the first of several visits to campus this academic year to share with students and faculty their wisdom on leadership and international business issues.

Murthy’s story was spurred by a question from Matt Spetzler, one of the second year MBA students attending the luncheon. “How did you become a successful leader,” Spetzler had asked, “particularly in an era when there were no executive training or mentoring programs in India?”

“I had no special qualities,” said Murthy, who was CEO of Infosys Technologies Ltd., for 20 years and now serves as chairman of the board and is known as chief mentor. “But I had a passion that was inspired by that bad experience in Bulgaria. Entrepreneurism is always driven by passion.”

The Indian executives navigated student questions like a yin-yang tag team, not only sharing good business thinking, but also modeling what working in male-female partnership can be at its best. Earlier that day, they had impressed a large audience of students and faculty in Bishop Auditorium with their one-two punch speeches. Mr. Murthy’s had centered on what kind of business opportunities exist for those who are willing to address the needs of emerging economies. Mrs. Murty’s had focused, as she quipped, on “how to spend your money very profitably” in order to help the rural poor of India.

During the luncheon Mrs. Murty, who started her career as one of India’s first female engineers, offered details about her work as chairperson of Infosys Foundation, which channels a percentage of profits from Infosys to uplift the “downtrodden” of India. As someone who spends 20 days of each month in the poorest areas of that nation, her tasks involve both high-level strategic planning as well as hands-on work with the least fortunate of society.

Responding to a question by first-year MBA student Navya Chaudhary, Mrs. Murty discussed the nature of volunteering during crises such as the devastating tsunami of 2004. “This work makes you understand that life is so fragile,” she said, describing how helpers were necessarily constrained to remain calm and stoic while picking up the severed body parts of the dead.

Katherine Kennedy, MBA class of 2009, wanted clarification on a comment about the Infosys Foundation having an exit strategy of three to five years in its social improvement projects so as not to make citizens completely dependent on the organization. “How do you navigate that when you say that it can take five to ten years to see change?” Kennedy asked.

“It depends on the project,” Mrs. Murty explained. Efforts such as supplying rural hospitals with ventilators and incubators can yield immediate positive results in health and longevity, she said, while interventions with, say, sex workers can take much longer, due to the complexity of the social issues involved.

Referring to remarks during Mr. Murthy’s talk about the importance of creating profitable business enterprises while creating “win-wins” for society, first-year MBA student Luke Stewart asked whether Infosys’s social stands have ever been at odds with its financial well-being.

“I’ve been a big critic of India’s policy of tax exemption for exports,” he responded. “We pay taxes in every other country but India. If we paid taxes there, it would be ‘bad’ for the company, but good for the country, which could use that money on education and healthcare for rural poor. The Infosys people are a lone voice in saying that this situation is not right.”

Tom Henneberg, MBA class of 2008, probed the issue of government corruption. “I find there’s considerable corruption,” Mr. Murthy affirmed. But, he said, Infosys has consistently refused to pay extortionary demands. In the company’s earliest and most financially vulnerable time, he said, it was slapped with a retaliatory and severe customs duty for not paying off officials in Bangalore. “Your value system translates to your conviction to pay a certain price for what you believe,” he said.

“In the end, such government officials actually respect you for refusing to give in,” Murthy said.

By demonstrating what it takes not to give in to a multitude of social pressures — be it the lure of making money at any cost or the inertia caused by the spectacle of intractable poverty — Denning Distinguished Fellows Narayana Murthy and Sudha Murty are providing the Stanford community with a new angle on the term “power couple.”

The Denning Distinguished Fellows are hosted under the auspices of Stanford GSB’s Center for Global Business and the Economy. The program has been established by a gift from Steve and Roberta Bowman Denning, both MBA ‘78.

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