Vishal Sikka resigns as Infosys CEO, bruised by disputes with founders: Major events since his appointment

Infosys CEO Vishal Sikka, in his notice to the board, said he was resigning because of "a continuous stream of distractions and disruptions'' that were stumbling blocks in managing the company.

By: Express Web Desk | New Delhi | Published: August 18, 2017 3:25 pm
Vishal Sikka, Infosys, Infosys CEO, Infosys CEO resigns, Vishal sikka resigns, Vishal Sikka news, Vishal Sikka Infosys, Narayana Murthy, R Seshasayee Vishal Sikka resigns as Infosys CEO, MD: The Board has been criticised several times by Narayana Murthy in the past. The Board, in a statement on Friday, said that “Mr. Murthy’s continuous assault is the primary reason that the CEO, Dr. Vishal Sikka, has resigned despite strong Board support’’.

Infosys Ltd Chief Executive Officer and Managing Director Vishal Sikka resigned from the post on Friday following differences with some founders of the company, including Narayana Murthy. Infosys put out a statement today stating the board of directors had accepted Sikka’s resignation and appointed U.B. Pravin Rao as interim CEO and managing director. Vishal Sikka, in his notice to the board, said he was resigning because of “a continuous stream of distractions and disruptions” that were stumbling blocks in managing the company.

Meanwhile, board of directors at Infosys Ltd squarely blamed founder N R Narayana Murthy for Vishal Sikka’s exit, a little over three years after he assumed the role. The Board has been criticised several times by Narayana Murthy in the past. The Board, in a statement on Friday, said that “Mr. Murthy’s continuous assault is the primary reason that the CEO, Dr. Vishal Sikka, has resigned despite strong Board support’’. Sikka, after his resignation, is now on the Board as the executive vice-chairman to oversee the transition. Also Read: Infosys Board: Narayana Murthy wants his diktats to prevail, responsible for Vishal Sikka’s exit

Here are the major events at Infosys Ltd since the appointment of Vishal Sikka as CEO three years ago:

August 2014: Former SAP AG executive board member Vishal Sikka takes over from S.D. Shibulal as Infosys CEO to revive the fortunes of the company which was losing market share.

December 2014: Some of Infosys’s founders such as N.R. Narayana Murthy, Nandan Nilekani, S.D. Shibulal and K. Dinesh – sell shares worth $1.1 billion in the company, cashing in on a more than 20 percent gain in the stock since Sikka’s appointment.

February 2016: Board decides to extend Sikka’s tenure by two years to 2021. Also Read: Vishal Sikka had been losing ground in Infosys for a while

February 2017: Infosys says had already addressed concerns about executive pay after media reported that its founders had complained about decisions including a pay hike for Sikka. Also Read: Vishal Sikka resigns: Who is U B Pravin Rao, interim CEO of Infosys

February 2017: Company reassures investors and analysts it was not being distracted by a dispute with founders.

April 2017: Founder Murthy criticizes salary hike given to Chief Operating Officer Pravin Rao.

April 2017: Company announces $2 billion cash return to shareholders and appoints independent director Ravi Venkatesan as co-chairman of board, moves seen aimed at placating some founders and former executives who were critical about the management.

August 2017: Sikka resigns as CEO, citing a stream of distractions and disruptions.

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  1. A
    Aug 21, 2017 at 7:32 pm
    Mr. NRN and co-founder board members are responsible for the downfall of Infosys. In the tenure of Sikka, infosys was running in profits. This is irony of Indian management. Since none of the co-founder couldn't become CEO, as Mr. Sikka non co-founder being CEO, this is exact the point, ego of board members including NRN got hurt and therefore this is was is infosys fiasco all about. Got save such egoistic top managements. : livemint /Companies/kh0jH09FsCQRoaYZmEnqyM/The-backstory-to-Infosys-CEO-Vishal-Sikkas-resignation
    1. S
      Aug 18, 2017 at 11:43 pm
      Reason 1 . Political. Murthy totally support Congress, even political candidate, close to karnataka Congress Siddu, for last decades. Sikka more support BJP govt projects. Murthy jealous, made fake accusations? Reason 2. Old model vs New. Murthy forcing his old $ vs Re cost-cheaper model. Trump prevents that old model. So Sikka using newer AI model, Murthy hates that model. Trump can stop Murthy surely, but neutral on Sikka AI model. Reason 3. Ethnic. South Murthy jealousy of North Sikka. Murthy cant handle North guy as leader, biased to his south guys. Reason 4. Age. Old vs New. Murthy type some old generation ppl, biased, do interference against new generation activities. U figure it out.
      1. V
        vikas mapara
        Aug 18, 2017 at 5:47 pm
        Very unfortunate to comment on ex-founder Mr. Murthy, who has lead this company throughout his carrier with remarkeble performance achievement for Infosys. The fundmental differences were surfaced when question was raised for dealing with Panaya where transparency was not maintained and was acquired at higher valuation, Severance package paid to ex CFO Mr. Bansal Falling short of financial guidance of Infosys on quarter to quarter basis after his induction as CEO. Mr. Sikka must answer on all these questions to clear doubts of investors. Why not Panaya investigation report was published by the board and in contrary alleging ex-promoter to lead his resignation. Board must come out clean on the misdeed of the management to regain investors confidence. This company can be saved by complete recaste of the current board and bringing back Mr. Nandan Nilkeni as CEO. There is saying in the world that "When Wind Blows It carries some Dust Particle along" There must be some truth behind left
        1. T
          Taaza Khabar
          Aug 18, 2017 at 9:11 pm
          NRN is just like Gandhis who will not let go CONG (I) till it is obliterated and Modi Shah will by 2019. Lod Vishnu, how about your Kalki avatar? NOW!
          1. S
            Aug 18, 2017 at 9:57 pm
            All your questions are actually irrelevant. What actually matters is the performance of the company during his tenure which was excellent due to which the former founders including Narayana Murthy made a lot of money by selling their shares for a much higher price than what its worth. Infosys used to be the worst place to work at during Narayana Murthys and Nandan Nilekani's reign and Sikka completely changed the work culture in a very positive way by giving incentives such as work from home as long as the work gets done and for the first time since its inception, Infosys employees started liking their workplace. Sikka knew the global trends in IT and he was slowly converting Infosys from a sweat shop to a true global player by investing in A.I and so on . Your suggestion of bringing Nanadan Nilekani is the worst suggestion I have heard, as he has no clue about the new trends in I.T. Thank God people like you are not on the board of any companies and are just keyboard warriors
          2. Sudheer Godgeri
            Aug 18, 2017 at 4:29 pm
            It is a good sign -- though Vishal Sikka had injected thrust on new technologies he had not cared for retail investors -- that corporate democracy prevails in Infosys. When top management draws insane ries not in sync with that of their employees and shareholders -- the actual major contributors of company's results -- it is a sign that something is wrong. It is good that current management/ founders have taken steps before this affected infosys in the long run.