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"There is a tremendous pressure on pricing and cost especially for commoditised services. So unless, we present the case of automation, it will be difficult to sustain margin," Rao said addressing the Citi India investor conference.
After assuming the charge as the CEO & MD at Infosys in August last year, Vishal Sikka, who was formerly an executive board member and head of technology of German enterprise software maker SAP, has been striving to bring in newer technologies such as automation, machine learning and artificial intelligence to improve service delivery and enhance productivity. As a part of his newly laid strategy, Sikka has also spelt out the company's focus on renew and new - renewing the core business while building capabilities in newer areas.
Rao said that the level of automation currently used in the industry is quite basic and much work is needed to enhance it. "Even though the industry has been working on this for quite some time, what you are seeing is some basic level of automation. Much more work is needed in this area using things like cognitive intelligence ad machine learning," he added.
As a part of this new strategy, Infosys last month had announced to acquire Panaya, California-based company which provides platforms to automate delivery of quality testing as well as customization of business software such as SAP and Oracle. The company had also articulated that it was looking at using Panaya to introduce automated service delivery models. "We have to really focus on improving productivity and improve it next year," Rao added.
He however said the company is comfortable at the current level of employee utilization which stood at 82.7%(excluding trainees) at the quarter ended December 31, 2014, the highest in last 11 years. "Utilisation level of between 80 to 85%is something which is our comfort zone and if it crosses 85 per cent, it becomes a challenge as 10%of the people are not available because of training and other reasons," he added.
Rao also said that the company is improving focus in the account management by redeploying senior resources from delivery. The move is expected to help mining the accounts better. So far around 150-200 people from delivery have been brought in for account management, he added.
Talking about the reorganization happening in the company, Rao said it is a continuous process as the organization has to revaluate the changes happening around in every three months. Earlier last month, Infosys has announced realignment of certain verticals, business lines and offerings to bring in more focus.
As a part of this, the company had separated delivery from sales and created it as a horizontal. Similarly, the two consulting units Lodestone which was earlier operating as a subsidiary of the company were merged to form a single consulting unit.
