Infosys plans to partner with clients to co-create IP assets

IT services major Infosys is planning to evolve its business model by partnering with global clients to build intellectual property assets.

"The central piece of 'Building Tomorrow's Enterprise' framework is what we are doing for co-creation (of intellectual property assets). It also includes the restructuring that we have done and the leadership that we have put in place," Infosys CEO and MD S D Shibulal said here.

For the past two decades, IT service companies have earned revenues by employing resources at a per hour basis for clients projects without any major investments.

"The purpose is to increase the results for our clients, create a balanced portfolio...create non-linearity between efforts and revenue and evolve the business model going forward...Innovation plays an important role here," he added.

Based on conversations with its clients, Infosys has organised workshops on various themes, some of which have led to closing of deals across consultancy, system integration as well as in products and platforms space, he added.

Infosys had announced its new business strategy, Infosys 3.0, as part of which the company decided to work on more transformational projects with the business side of clients instead of just the IT functions.

The new strategy intends to transform Infosys from a technology solutions company to a business solutions provider.

Over the last few quarters, Infosys has failed to meet expectation of investors and analysts by not meeting its revenue guidance. Moreover, for FY'13, the company has slashed its revenue forecast to 5 per cent, much lower than industry's target of 11-14 per cent growth.

Infosys, however, remains confident of its new strategy bearing desired results and Shibulal said it is making the "right investments" for the future.

Infosys, along with other IT services companies, are increasingly experiencing slowdown in traditional IT outsourcing environment amid a gloomy global economic environment and rapid changes in technology consumption.

In such a scenario, Infosys is betting on products and platforms business to contribute 33 per cent of its revenues in the next 5-7 years.

"We are looking at building IP assets ourselves and we will also partner with our clients to co-create (assets) as this will be crucial. We will also look at acquisitions ... to convert it to products and platforms," Shibulal said.

In line with strategy, the company has also launched a product experience centre in London which aims to showcase different technologies for to help clients optimise their revenues and reduce operational costs.

"For a UK client, we eliminated 1,000 servers for the company, which resulted in additional savings through reduced carbon footprint," Shibulal added. Through all these initiatives, Infosys has USD 308 million in Total Contract Value booked on its technology platform business. It is also working on 10-12 products in areas like social media, cloud computing, mobility and big data to help  enterprises build flexibility and market products faster.