Narayana Murthy: 'The power of money is to give it away': Infosys' yogi has a mantra for our times

The chairman of the Indian IT giant that made business totally global will take centre stage in Davos this week. But en route he revealed his philosophy to Irene Hell
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The annual World Economic Forum starts in the Swiss resort of Davos on Wednesday, bringing together hundreds of global leaders - from Lord Browne of Madingley and George Soros, to Thabo Mbeki and Angelina Jolie. The event has six co-chairmen. Many people will have heard of at least three of them: Bill Gates, Charles Prince of Citigroup and Daniel Vasella of Novartis.

The annual World Economic Forum starts in the Swiss resort of Davos on Wednesday, bringing together hundreds of global leaders - from Lord Browne of Madingley and George Soros, to Thabo Mbeki and Angelina Jolie. The event has six co-chairmen. Many people will have heard of at least three of them: Bill Gates, Charles Prince of Citigroup and Daniel Vasella of Novartis.

But the name of another of the six, Narayana Murthy, is less familiar. It shouldn't be, because the 58-year-old Indian is chairman of Infosys, the $12bn (£6.5bn) IT giant, which has its headquarters in Bangalore.

Infosys was founded 24 years ago by seven software experts, five of whom still work for the business. In those days, they had just $250 of launch capital, had to wait a year for a telephone line to be installed and had to make 15 visits to the Department of Electronics to be allowed to have a computer. Yet despite, or maybe because of, this humble beginning, Infosys has revolutionised IT, and business in general, by pioneering the practice of "offshoring" - or outsourcing business to another, cheaper country.

Explaining how offshoring works (although he prefers to talk of the "global delivery model"), Murthy says: "We take a large project and split it into multiple sub-tasks. About 20 to 30 per cent of these are done near the customer. The other tasks are outsourced to talented, process-driven, scalable technology-based, cost-competitive countries like India. In this way, the customer gets better-quality software. He saves time, brings his products sooner to market and finally gets better value for money."

The group makes nearly all its money outside India - 70 per cent of it from the US, most of the rest in Europe - and with the exception of a couple of small ventures, has nearly all its staff in India. It success led Murthy to be named World Entrepreneur of the Year for 2003 by accountants Ernst & Young.

Murthy, who claims it was never his ambition to make money, has a different world view from most businessmen. "When people get rich, they cut themselves off from the context that has earned them these riches - the context of the common men," he says. "They forget they are part of society. I believe that unless we are in touch with reality and the common people, we will not be in a position to add value to society."

He adds that this view is also held by his business partners. "We, the founders of Infosys, have donated from our personal money at least 60 per cent of our wealth in cash. In addition to that, the company donates a certain percentage of its profits to the Infosys Foundation."

The Foundation, which is run by Murthy's wife, Sudha, donates to some projects that would make the average chief executive's hair turn white. "We focus on activities that address the basic needs of the poorest of the poor. For example, we have built hospitals and homes for the elderly and destitute, as well as rehabilitation centres for prostitutes."

Certainly his attitude does not tally with many of the tenets of Western capitalism that are supposed to energise business. "Many people ask me: 'What is the real power of money?' I tell them: 'The real power of money is the power to give it away.' Because you can have five cars, you can have five houses, you can send your children to the best schools, but then you can only eat twice a day. You can drink only so many cups of coffee and so many bottles of beer. I think people like Bill Gates, who have given away enormous sums of money, are shining examples for all of us to follow."

Murthy is often described as the Indian Bill Gates, not least because the two men are leaders in the world of IT. He is not comfortable with the comparison, choosing to describe his strengths rather differently. "I am a man in a hurry," he says. "I am what we call a karma yogi in Sanskrit. A karma yogi is somebody who believes in data. I collect a lot of data. I am relentless. I just do things as if there is no tomorrow. That is why I think I am impatient. I am totally transaction-based.

"If you have proper data for the transaction, then you win the transaction. If you don't have, you don't. So people are very comfortable with me because I go purely by data. We have a saying at Infosys: in God we trust - everybody else brings data to the table."

He also rejects the description of himself as a mastermind. "I would not say that. I think we are a team. I have a degree in computer science. All of us, the founders of Infosys, we were working together in the area of software. This is the only thing we know. At the beginning, this company could not have come up without any one of the seven senior people. Now we employ about 35,000 people.

"Everybody adds tremendous value. Sometimes you say the ear is not important, but the moment the ear fails and starts paining, then you realise the importance of the ear. Next time you say: the toe is not important. The day the toe starts paining, then you know that it is important. So I believe that every single one of our 35,000 people is an important player in the company."

Running such a large company - which is now listed in New York as well as Mumbai - is not easy. Infosys spends a great deal of time talking about corporate governance, meritocracy and "value systems". Its chairman also talks a great deal about respect. "As long as we respect our customer, as long as we are willing to learn from people who are better than us, as long as we have a sense of healthy respect for our competitors, as long as we use speed, imagination and excellence in the execution of everything we do, we will continue to be successful. The day we forget any one of these, we will disappear like dew in the morning."

At the World Economic Forum this week, a lot of the talk will be concerned with the aftermath of the tsunami disaster, which killed more than 10,000 people in India, among more than 225,000 worldwide. Murthy believes this is an important moment for the business community to make a genuine difference.

"I have watched, with a sense of warmth, how the world has responded to this catastrophe," says Murthy. "There has been an outpouring of help, aid and support. This is an affirmation of my faith in humanity. But I believe there needs to be greater preparedness to face such eventualities. I refer to the role of business community partnerships in managing mitigation. To ensure an effective response, such partnerships must be put in place before such calamities, not in their aftermath."

It is hardly your usual business leader's soundbite.

BIOGRAPHY

Born: 20 August 1946 in Karnataka, India.

Education: degrees in electrical engineering from the University of Mysore and in technology from the Indian Institute of Technology.

1981: founds Infosys along with six software professionals and $250; later appointed chief executive.

1999: Infosys Technologies became the first Indian-registered company to be listed on the Nasdaq exchange.

2002: stands down as chief executive to become chairman.

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