 "Infy eyes at least 10% of revenue from Edgeverve by 2020")
Infosys expects its newly-formed arm Edgeverve Systems, which focuses on products, platforms and solutions, to contribute at least 10 per cent to its overall revenue over the next three to five years. Currently, the contribution of the subsidiary, which excludes Infosys’ most successful product offering Finacle, is about two per cent of Infosys’ revenues.
“Three to five years is when we see Edgeverve Systems contributing significantly to our revenues,” Infosys’ chief operating officer U B Pravin Rao told Business Standard. “Today, it is around two per cent; for it to reach about 10 per cent or something, it will take that much time.”
“Three to five years is when we see Edgeverve Systems contributing significantly to our revenues,” Infosys’ chief operating officer U B Pravin Rao told Business Standard. “Today, it is around two per cent; for it to reach about 10 per cent or something, it will take that much time.”
Incorporated in February 2014, Edgeverve Systems was hived off from Infosys mainly due to the difference in the nature of products business as against the company’s bread-and-butter services business. In a statement to US Securities and Exchange Commission in 2014, Infosys had said it has invested less than $1 million in Edgeverve Systems, which is expected to focus on developing and selling products and platforms.
The products and platforms business was first initiated in Infosys in a significant manner when the company set out on its 3.0 strategy in 2011. Under the strategy, the company was aiming to get at least one-third of its revenues from intellectual property-based software products, platforms and solutions by 2020. However, with no prior experience in the field, the company failed to implement this strategy. Most products and platforms developed by Infosys have not been able to significantly scale up, with the exception of Finacle core banking solution, which has seen strong traction.
Edgeverve Systems has now consolidated its offerings and selected six “pet” projects that it is focusing on. The six focus areas include commerce, customer service, digital marketing, ecosystem, management and procurement.
“We have consolidated the projects that we were undertaking at Edgeverve. We have retired some earlier ones and added some that are in the early stages,” Rao said. “Basically we have identified six pet projects that we are focusing on and each one is at different levels of maturity.”
While Edgeverve Systems is aggressively tapping clients with its current offerings, Rao said, the subsidiary will continue to work on adding newer products and platforms to its portfolio. Also, in line with the nature of the business, Edgeverve Systems will keep looking to retire projects that do not perform as per expectations.
“In Edgeverve you will always have different things; there will be some products or platforms that are in the early stage and over a period of time if we don’t find traction, we will reiterate them,” Rao said. “We are really encouraged about the business because we are seeing more and more clients adopting it. We realize that every product will not excel, it is going to be a combination of products. But our estimate is that in the next three to five years Edgeverve will at least make an impact on our growth.”