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Vishal Sikka resigns from Infosys; Cites personal attacks, 'continuous distractions' as reason for quitting

  • Vishal Sikka will continue to hold the position of the executive vice chairman until a permanent chief executive officer and managing director takes charge.
  • This is likely to happen no later than March 31, 2018. 
  • He cited among his reasons for leaving a continuous stream of distractions and disruptions over the recent months and quarters, increasingly personal and negative as of late, as preventing management's ability to accelerate the company's transformation
Vishal Sikka resigns Cites personal attacks continuous distractions as reason for quitting

It came a big surprise for Infosys employees when their Managing Director and CEO-Vishal Sikka-resigned on grounds of personal attacks. In fact, the administration is said to have accepted his letter of resignation immediately, making their take on the matter clearer. While this happened this Friday morning, rumours are rife that COO UB Pravin Rao would be the interim managing director and CEO. 

The share prices have plunged by 7% after the announcement was made. Amid this chaos, 50-year-old Sikka cited "personal attacks" as one of the reasons to resign. He also said that he was disappointed by the lack of support from the people he had expected would back him. Writing in a blog, Sikka said, "For days, indeed weeks, this decision has weighed on me. I have wrestled the pros and cons, the issues and the counterbalancing arguments. But now, after much thought, and considering the environment of the last few quarters, I am clear in my decision. It is clear to me that despite our successes over the last three years, and the powerful seeds of innovation that we have sown, I cannot carry out my job as CEO and continue to create value, while also constantly defending against unrelenting, baseless/malicious and increasingly personal attacks."

Earlier, Infosys founders, including NR Narayana Murthy criticised the way the company functioned and criticised the executive pay packages and corporate governance. This was in complete disagreement with Sikka. According to a report by NDTV, Murthy reportedly said that he was told by three independent directors that Sikka was more of chief technology officer than a CEO. Murthy also criticised the Infosys Board for not upholding the standards of governance and for not creating measures required in an established company. 

It is yet to be determined why there was a sudden rift in the camaraderie that the duo shared. Earlier, Murthy was quoted as saying,"I have nothing against Dr Vishal Sikka. I enjoy spending time with him. I have never commented about his strategy or its execution."  Sikka too had earlier this year called Murthy an "incredible man" and that he shared a "heartfelt relationship with him". However, this was in contrary to what he wrote in his resignation letter.

Sikka wrote, "In his notice of resignation to the board, Dr Sikka reiterated his belief in the great potential of Infosys, but cited among his reasons for leaving a continuous stream of distractions and disruptions over the recent months and quarters, increasingly personal and negative as of late, as preventing management's ability to accelerate the company's transformation," Infosys said in its statement today, adding that "the board understands and acknowledges Dr Sikka's reasons for resignation, and regrets his decision. In particular, the board is profoundly distressed by the unfounded personal attacks on the members of our management team that were made in the anonymous letters and have surfaced in recent months."

It is also being said that Sikka will remain with Infosys as the executive vice chairman and he will continue to hold office until new permanent chief executive officer and managing director takes charge. This is likely to happen no later than March 31, 2018. 

Vishal Sikka's full resignation letter

According to a report by moneycontrol.com, this is what Sikka wrote in his resignation letter:

Dear Board Colleagues,

Over the last few days, since our earlier call, I've met Sesh several times, talked to you individually at length, and spent time thinking things thru with Vandana. During this time, one of our employees, Sandeep Karamongikar, died in his sleep, likely of a massive heart attack. He was working on the chatbot frontend in Nia. Also over the weekend, in possibly the greatest demonstration of AI capability ever, a bot built by the researchers at OpenAI (yes, that OpenAI), defeated the world's best players of DOTA2, a multiplayer online video game, a game where the bot learned to play entirely from scratch. Further demonstrating that the force to automate routine, even advanced, activities is an unstoppable and exponential one. And the Charlottesville incident here in the US demonstrated once again the power of words and silences to cause real damage, or to heal.

After much reflection, I have concluded that it is indeed time for me to leave my current positions as MD and CEO, and I have communicated my resignation to Sesh.

I will be working closely with Sesh, Ravi, Pravin, with all of you, and the senior management team to plan out the details and the timelines to ensure a smooth transition and in the meantime, continue our work without disruption, and ensuring that we protect our company, the employees, the clients, and the interests of every shareholder. You can count on my commitment to this.

I came here to help navigate the company through what I saw as a massive transformation opportunity, to transform our company and restore strong profitable growth, as well as help transform the business of our customers. I came to do this with the power of technology, given my experiences with similar transformations, my background in AI, and the structural changes that I saw happening in the IT services industry. This needed new skills, new thinking, new initiatives, and a transformation in the culture, from a cost-oriented value delivery, to entrepreneurship oriented value delivery. You have heard me articulate this many times before.

This type of a transformation has always been a passion for me, indeed I took this job for this reason. We have achieved much in the last 3+ years, and for sure we can all be proud of the powerful seeds of transformation that have already been sowed. No one anticipated the additional headwinds like the geo-political disruptions (Brexit, Trump, visa etc.) that made this transformation even more challenging, but also rewarding. But, the distractions that we have seen, the constant drumbeat of the same issues over and over again, while ignoring and undermining the good work that has been done, take the excitement and passion out of this amazing journey. Over the last many months and quarters, we have all been besieged by false, baseless, malicious and increasingly personal attacks. Allegations that have been repeatedly proven false and baseless by multiple, independent investigations. But despite this, the attacks continue, and worse still, amplified by the very people from whom we all expected the most steadfast support in this great transformation. This continuous drumbeat of distractions and negativity over the last several months/quarters, inhibits our ability to make positive change and stay focused on value creation. Addressing the noise by itself is damaging; hundreds of hours of my own time has gone into this recently. But the structural challenges this engenders within the organization, has a very damaging effect on our ability to carry out any kind of a transformation, especially one that is as fundamental as transforming from a cost-oriented to an innovationoriented value delivery to clients.

Therefore, I have come to this moment and the end of this journey. I hope that it gives everyone a chance to reflect, and give the transformation effort another big push and move the company forward rapidly to build its future, to build upon the foundation that we have laid over these past 3 years. If these types of attacks continue, I hope each of you will continue to be the voice of fairness and reason - providing the active, emphatic and unequivocal support that the company, the management, the employees, and all of the stakeholders and friends of the company need in order to succeed. Since the board deeply believes in the cause we have started, I will be happy to support all of you to achieve a smooth transition, and serve as your Executive Vice Chair as discussed.

I would like to thank each one of you, my dear colleagues, my friends and mentors, and look forward to working with you to close this chapter and open a great new one for all of us.

Best,

V

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