Infy plans unit for products biz; Finacle to be kept out

The creation of such a unit is expected to provide operational flexibility and autonomy to run this business.

Updated: February 28, 2014 4:00 am

Infosys will create a separate subsidiary for its products, platforms and solutions (PPS) business in order to provide a focused approach to this segment, which is expected to be a game changer for the tech industry in the near future.
In a notice to the exchanges on Thursday, Infosys said, “We are in the process of forming a new subsidiary for our products and platforms business, and we will be happy to share the specific details once it is formed. Finacle will not be a part of this subsidiary. We have created subsidiaries in the past as well to help us better serve our client needs. Our effort to create a subsidiary for our products and platforms business is an operational matter and is being pursued to help us deliver better value to our clients.” Finacle is Infosys’ banking product.
Infosys has been planning to create a separate subsidiary for PPS, which contributes around 5.5-6 per cent to its overall revenues, for quite sometime now. This change is likely to happen in the next financial year.
The creation of such a unit is expected to provide operational flexibility and autonomy to run this business.
Unlike the traditional lines of IT services business, where the input and output is measured on the allocation of human resources, the PPS segment requires to be handled differently as the focus is on creating intellectual property. The separate subsidiary of PPS will help further drive innovation for Infosys and bring in certain start-up buzz to this segment.
Infosys chairman NR Narayana Murthy in a recent investor call said that PPS is an important component of their 3.0 strategy to delink revenues from person month effort through intellectual property-based products, platforms and solutions.

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