Infosys Technologies Ltd

BUSINESS TO BUSINESS MARKETING

PROJECT REPORT ON MARKETING STRATEGIES OF INFOSYS TECHNOLOGIES

SUBMITTED TO:

SUBMITTED BY – TEAM 11

PROF SEKHAR V.

RUBY BHATTACHARYA SHALU UPADHYAY MANSI CHADHA VICKEY BANSAL SHFALI KHAJURIA PADMINI B. SIDDHARTH KAUSHIK (MARKETING – SECTION A)

BACKGROUND

Infosys Technologies Ltd. (NASDAQ: INFY) was started in 1981 by seven people with US$ 250. Today, we are a global leader in the "next generation" of IT and consulting with revenues of over US$ 4 billion. Infosys defines, designs and delivers technology-enabled business solutions that help Global 2000 companies win in a Flat World. Infosys also provides a complete range of services by leveraging our domain and business expertise and strategic alliances with leading technology providers. Infosys' offerings span business and technology consulting, application services, systems integration, product engineering, custom software development, maintenance, re-engineering, independent testing and validation services, IT infrastructure services and business process outsourcing Infosys pioneered the Global Delivery Model (GDM), which emerged as a disruptive force in the industry leading to the rise of offshore outsourcing. The GDM is based on the principle of taking work to the location where the best talent is available, where it makes the best economic sense, with the least amount of acceptable risk. Infosys has a global footprint with over 50 offices and development centers in India, China, Australia, the Czech Republic, Poland, the UK, Canada and Japan. Infosys and its subsidiaries have 105,453 employees as on September 30, 2009 Infosys takes pride in building strategic long-term client relationships. Over 97% of our revenues come from existing customers. Vision "To be a globally respected corporation that provides best-of-breed business solutions, leveraging technology, delivered by best-in-class people."

Mission "To achieve our objectives in an environment of fairness, honesty, and courtesy towards our clients, employees, vendors and society at large."

Values We believe that the softest pillow is a clear conscience. The values that drive us underscore our commitment to: Customer Delight: To surpass customer expectations consistently Leadership by Example: To set standards in our business and transactions and be an exemplar for the industry and ourselves Integrity and Transparency: To be ethical, sincere and open in all our transactions Fairness: To be objective and transaction-oriented, and thereby earn trust and respect Pursuit of Excellence: To strive relentlessly, constantly improve ourselves, our teams, our services and products to become the best

A Magnet for the Best Global Talent Fortune magazine identified Infosys among the top companies that "inspire, nurture and empower a new generation of global leaders." We are committed to remain among the industry's leading employers. Innovation, Speed and Excellence in Execution We were one of the first companies to develop and deploy a global delivery model and attain SEI-CMMI Level 5 certification our offshore and onsite operations. We manage growth by investing in infrastructure and by rapidly recruiting, training and deploying new professionals. We have 44 global development centers, the majority of which are located in India. We also have development centers in Australia, Canada, China, Japan, Mauritius, and at multiple locations in the United States and Europe. We invest in infrastructure and people to continue growing our business.

Industry Leadership Our history is marked by a series of firsts. We were the first Indian company to list on a US stock exchange and the first Indian company to do a POWL in Japan. In December 2006, we became the first Indian company to be added to the NASDAQ-100 index and became the only Indian company to be part of any of the major global indices. We were recently also listed on The Global Dow. Infosys was also ranked No. 14 among the most respected companies in the world by Reputation Institute's Global Pulse 2008. We were also listed on Forbes' Asian Fabulous 50 for the fourth consecutive year. Infosys is also a five-time Global MAKE Winner and one of only two Indian companies amongst global leaders to have won the award in 2008. QUALITY 'In God we trust, everyone else must come with data' is an oft-heard phrase at Infosys. We constantly benchmark our services and processes against globally recognized quality standards. Our certifications include SEI-CMMI Level 5, CMM Level 5, PCMM Level 5, TL 9000 and ISO 9001-2000. In February 2007, Infosys BPO was certified for eSCM level 4.0, the eSourcing Capability Model for Service Providers developed by a consortium led by Carnegie Mellon University's Information Technology Services Qualification Centre.

Continuous improvement is today applied to Infosys‘ core engagement delivery processes, support processes including a number of client-facing processes, as well as organizational management and leadership processes – to realize tangible benefits for our clients.

Summary of Infosys’ Client-Facing Quality Tracking Methodologies A number of quality tracking methodologies, tools, and processes are put in place to ensure superior quality products and service to Infosys clients – in each engagement and also across engagements, at the relationship level. These quality tracking methodologies are discussed below, classified based on the client objectives addressed through specific quality programs, tools, and systems: Relationship Management and Governance Software and Service Quality Solution and End-User Focus Operations Resourcing Effectiveness Relationship and Governance Focus Client-facing Activities All Services

Illustrative Tools & Methodologies Client portals Reporting dashboards Governance and Program Management models Joint Management / Executive / Steering Committees Customer Satisfaction Program

The Balanced Scorecard framework is a management system that enables organizations to clarify their vision and strategy and translate them into action. The benefits from the implementation of the balanced score card concept include improvement in individual project specific metrics as well as substantial improvements in relationship based metrics.

Frameworks Balanced Scorecard

Client-facing Objectives - Transparency - Vendor governance - Service-level monitoring - Basis for risk/reward

Typical Client-facing Metrics Customer Satisfaction Measures Project-level Satisfaction Measures Aggregate Statistics & Measures Engagement Status Reports Relationship status Reports Early Warning Indicators

Software and Service Focus The focus on software and service quality is driven primarily through the disciplines and processes established in order to maintain an organization wide Capability Maturity Model (CMM) level 5 rating (the highest in the industry). These are enabled by quantitative feedback from the process and proactively introducing innovative ideas and technologies across the organization to meet its business goals.

At Level 5, the focus is also to prevent defects from happening rather than removing them later to ensure better quality. Client-facing Activities AD/M Outsourcing Production Support Package Implementation Systems Integration

Illustrative Tools & Methodologies IPM (Integrated Project Management) Tools QSD (Quality Systems Documentation) Process Capability Baselines PRISM (Project Review by Infosys‘ Senior Management)

Solution and End-user Focus Infosys piloted CMMI for engagements from one of our larger offshore development centers (Chennai) and was assessed at Level 5. Further, the CMMI approach integrating onsite operations with offshore is currently being rolling out across the enterprise.

Client-facing Activities AD/M Outsourcing Package Implementation Systems Integration

Illustrative Tools & Methodologies CMMI QSD (Revised QSD based on CMMI) InFlux Integrated Project Management

CMMI strengthens many areas beyond CMM. Some of these are: Life cycle processes Decision making framework within engagement delivery Risk management Quantitative Project management Defect & problem prevention (continuous improvement)

Operations Focus The tools and methodologies work within Infosys based on defined inputs from clients or client-facing employees, to deliver software solutions to defined quality goals, summarized in the table below.

Frameworks Six Sigma CMM ITIL ISO 9001

Client-facing Objectives Process improvement Performance predictability Problem management Productivity improvement

Typical Client-facing Metrics System / Resource Availability Incident frequency / Criticality Problem Response / Resolution times TCO Reduction

Resourcing Effectiveness Focus Infosys has piloted the P-CMM (People-CMM) framework in addition to the aspects of the Malcolm Baldrige framework for human resource management.

Client-facing Activities All Services

Illustrative Tools & Methodologies Role-based organization Skills Management & Integrated Learning Process Performance Management Process Integrated Overseas Mobility Process Operations Planning Process

The adoption of ―quality tracking methodologies‖ including six-sigma continuous improvement processes (e.g., for overseas mobility) is critical to Infosys‘ ability to meet client-facing goals on resourcing speed, quality, and effectiveness.

Frameworks P-CMM Six Sigma Baldrige ISO 9001

Client-facing Objectives Time-to-market Staffing efficiency Staffing effectiveness

Typical Client-facing Metrics Ramp-up / Ramp-down goals Key staff performance reviews

INFOSYS CORE CAPABILITIES AND COMPETENCIES

Infosys has focused on providing services that transform the way business is done through the use of Information Technology, since its inception in 1981. The key strengths of Infosys are summarized in the table below:

Infosys Key Strengths Area

Competency

Service Offering

One stop capability: Infosys today has the distinction of being a one-stop shop, providing services across the entire business value chain from Business and IT Consulting through Implementation & Support services.

People

Ability to attract and retain the Best Talent: Infosys has been ranked the best employer to work for in India by a number of surveys. We have been able to attract and retain the best talent. At the same time, we have been able to inculcate a culture that empowers employees and motivates them to take ownership of their duties. Infosys enjoys one of the lowest attrition rates in the industry.

Process

Delivery Excellence: With a record 95% of all projects delivered on time and within budget, we are clearly a leader in project management and reducing the cost of ownership for our clients. We effectively leverage CMMI level 5 quality and ongoing initiatives such as aligning with the Malcolm Baldrige framework and the six-sigma cross functional process mapping to deliver high quality solutions to our clients. Additionally, via the Infosys pioneered global delivery model (GDM), we are able to offer our clients‘ cost-savings of 20% to 30% without compromising on service levels. Our superior knowledge management systems enable retention of knowledge within the project team and the organization. The resultant efficiencies have helped us deliver value to our clients at lower cost and with fewer defects

Technology

Technological superiority: Infosys has brought together thought leaders within the organization to form the Software Engineering and Technology Labs (SETLABS). SETLABs is the research wing of Infosys consisting of specialists in software architecture, methodologies, emerging technologies and platforms. SETLABs mainly focuses on: Developing frameworks & methodologies to address critical points in solution lifecycle Leading edge technology watch and competence building

Assimilating knowledge and building framework for enterprise software like the EAI framework Provide technology related services such as Architecture consulting and definition, Internet security consulting and capacity planning. Project Management

Strong Project Management capabilities ensure that the development process is predictable and that surprises and cost/time over-runs are avoided or minimized. Our strength in Project Management also ties in with our SEI-CMM Level 5, PCMM & CMMI credentials and our experience with Large & complex projects. Infosys has also worked in several multivendor scenarios where our success has major dependencies on the actions of other players and our Project management expertise has stood us in good stead in these situations.

All of the above factors combined have resulted in lower total cost of ownership for our clients due to predictable, trouble-free execution of projects.

SUMMARY OF SERVICES

Offerings We bring together a combination of the following services, platforms and products to give your business a competitive edge: Business: Consulting, Corporate Performance Management, Enterprise Architecture, Modular Global Sourcing Process: Business Process Outsourcing, CRM, HCM, Process Re-engineering, SCM Platform: Enterprise SaaS, Finacle Universal Banking Product Engineering: Lifecycle Management, Plant Operations, Process Engineering, Product Engineering, Value Engineering IT: Application Services, Enterprise Security, Independent Validation, Infrastructure Management, IT Process Consulting, IT Strategy, Learning Services, Performance Engineering, Systems Integration Innovation: Co-creation workshops, Research & Development

Technology stack

Platforms: Handhelds, iSeries (AS/400), J2EE, Macintosh, Mainframes, Microsoft, Open Source, Unix Enterprise Applications: i2, Microsoft Dynamics, Oracle, PeopleSoft, SAP, Siebel Enterprise Application Integration: BizTalk, IBM, Oracle, SAP XI, TIBCO, Vitria, webMethods

Customer Service Process

The customer service process at Infosys has seven parts, i.e;

1. Customer Service Approach Infosys is a leading IT solutions company with a demonstrated record of accomplishment of partnering global corporations to drive business benefits through high-impact technology engagements. Innovation, Quality and Customer satisfaction are integral part of Infosys Value system.

Relationship Management Infosys gives great importance to relationship management. Few of the initiatives being     

Relationship team with experience of managing large, critical engagements with multiple stakeholders Proven engagement models with multi-tier interactions ―Engagement Manager‖ - single point of contact with bottom-line responsibility for service delivery and overall customer satisfaction Focus on partnering with the client defining and implementing a ―shared strategic vision‖ for the relationship Balanced Scorecard for defining and measuring achievements vs. objectives Robust Change management framework for helping clients deal with cultural and organizational effects of outsourcing

The advantages to clients are:    

Visibility into relationship structures and critical communication flows Clear ownership of objectives Result-oriented management – quantifiable and measurable through the Balanced Scorecard Tight coupling between strategy and execution to ensure relationship objectives are in line with the client‘s strategic imperatives –

Technology Competence Infosys uses its SETLABS (Software and Engineering Technology) department in addition to industry alliances to ensure we maintain up-to-date skill sets and provide innovative solutions to our customers. SETLabs builds technology competency, supported by a state of-the-art lab environment, along three dimensions:  Building thought leadership through Greenfield research, publications and presentations  Creating methods and frameworks to improve execution effectiveness. Frameworks/toolsets address critical points in a solution life cycle and enable use of leading technologies such as .NET and MCommerce  Deepening knowledge in chosen horizontal areas such as Enterprise Architecture, Infrastructure and Security through specialist research in these areas

Tools and Methodologies Clients will have visibility into the various in-house tools & methodologies used by Infosys during the execution of this engagement - these can also be demonstrated to clients upon specific request both during this RFP process and also during the engagement. These can also be shared with the client‘s team depending upon use and technical feasibility. For large and strategic relationships, we also build an account portal; that provides an overview of the entire relationship and also status of various projects to all the team members. It will also have a reporting schema, where senior management can review project status, etc. Infosys has a number of alliances in technology related areas which can be used to clients advantage These alliances give us access to the latest in the area of technology and we pass on these learning‘s to our clients. Some of the key alliances are mentioned in the item number 6 later in the document. Quality and Customer Satisfaction Quality and customer satisfaction is a way of life at Infosys. Over 90% of our business comes in as repeat business, a testament to our customer satisfaction levels. Our front-line people are enabled and empowered to take quick decisions in relation to customer needs and customer satisfaction. Infosys Quality System Documentation (QSD) has a well defined, documented and repeatable process and methodology for every stage in the service lifecycle that has evolved from experience and designed for continuous improvement in terms of quality and productivity- all of which would translate to higher customer satisfaction .Infosys is a SEI CMMI Level 5, and PCMM Level 5 certified company. Infosys committed itself early in its quality journey, to differentiate itself based on quality. This enabled the institutionalization of process orientation through out the organization.

2. Issue Resolution and Escalation Mechanism Infosys follows a comprehensive issue management framework. The framework covers: Issue identification Issue resolution and Communication The Infosys relationship team takes all possible measure to proactively identify issues , whether they be project-specific or at a relationship level and communicate them to clients. The means of communication include weekly status reports, daily/ weekly teleconferences/ video-conferences and quarterly relationship reviews. The team identifies the risks arising as a consequence of the issue and possible steps to mitigate the risks. The team also identifies various options to resolve the issues. These options are discussed with clients and a consensus resolution is arrived at. Infosys, also, escalalation mechanisms to address those cases where the resolution is not satisfactory.

3. Client Feedback Mechanism

Infosys obtains client feedback through formal and informal means. Infosys, through an external agency, conducts an annual Customer Satisfaction Survey. This is aimed at obtaining formal, direct and honest feedback on our performance and ability to meet client expectations. In addition, there are informal and semi-formal such as our annual customer event "Milan" and analyst interactions, which provide us an opportunity to gather information on trends, customer concerns and other competitive information. The feedback from our customer surveys is analyzed and the findings discussed by the Board of Directors to identify specific actions to improve customer satisfaction. Similarly, our annual client-facing group meet makes a conscious attempt to identify and cross-pollinate best practices across business units and geographies

4. Client Privacy Currently, we do not send ―sales & marketing‖ information from our web site or through mass-mailing campaigns. Visitors to our web site can request specific information by sending an e-mail to the contacts provided on the web site. Such requests are then processed and members of our Business Development team interact with the person requesting information. Information about the visitor is not used for any marketing purposes. We gather personal information only for the following: Investors– for sending out annual reports & results. The requestor‘s Name, Email ID, Company Name, Designation, Address, Telephone and Fax numbers & Country are captured in the form. This information is used only for Investor Relation purposes – sending out financial information and is not used for sending any marketing or sales information. Media– for sending out press releases. The Name, Email ID, Company Name, Designation, Address, Telephone Numbers, Fax Numbers & country is captured in the form. This information is used only for Media related purposes – sending out press releases and is not used for sending any marketing or sales information. Mail to a colleague – for sending viewpoints available on the web site. The Name of the colleague, email id of the colleague, name of the sender and email id of the sender are captured. The information gathered is captured to personalize the email being sent out.

We are in the process of implementing permission-based marketing programs through our web site, wherein we will collect information from web site visitors for sending marketing/sales information. We will gather personal information to allow access to specific collateral on the web site (premium content) and/or to send: Newsletters Special offers/updates Service/offering related announcements

The process will be completely ―Opt-in‖. No information will be sent until the person has requested for it / signed up for it / given explicit permission to Infosys to send such information. There will be a profile manager available which will enable the person to control the information being sent to him. At any point of time the person can define what he/she wants to receive or change/update his profile. There is an option to unsubscribe completely. Every communication has a link/provision to unsubscribe. We do not share our information with any 3 rd parties. A potential exception might be to comply with the Law (e.g. comply with judicial proceedings or a court order etc.). We do not use any web bugs/clear gifs Like most web sites, we use log files. This includes internet protocol (IP) addresses, browser type, internet service provider (ISP), referring/exit pages, platform type, date/time stamp, and number of clicks to analyze trends, administer the site, track the users‘ movement in the aggregate, and gather broad demographic information for aggregate use. IP addresses, etc. are not linked to personally identifiable information. The information gathered is stored behind firewalls within the Infosys network and will be on servers separate from web site server. All standard security processes and measures are in place to avoid any kind of unauthorized access- physical or electronic. The information is secured both online & offline and is accessible only to authorized personnel from the marketing and the sales teams. We use session ID cookies to store session specific information and the cookies are terminated the moment the visitor closes the browser/ends the session. We do not use persistent cookies. [Usage of a cookie is in no way linked to any personally identifiable information while on our site.] We use third party services to power some parts of our investor relations section. However, no personally identifiable information is gathered for viewing these pages. We do not use any third party advertising services for our web site. In certain specific cases, we provide links to other web sites outside the Infosys network. Infosys Technologies Ltd. is not responsible for the privacy practices or the content of such Web sites.

5. Timezones Management Infosys proposes to use it‘s Global delivery model for executing projects. In order to execute engagements, we have a small part of the team located onsite, while the majority of the team is offshore. For a typical Application development/ maintenance project, the onsite team is accessible during US/ Europe time zone. The onsite team acts as an interface between client and the offshore team. We currently have ~ 4000 resources at various client locations and in our development centers in North America around ~ 500 in Europe. However, for Help Desk services; please note there will be a night shift working in India to provide day time support for US / Europe.

6. Transition at Client End

Measures to ensure smooth transition A detailed Gap Analysis for the Benefits & terms applicable. Based on the same, designing an equitable compensation & terms plan. Discussions with the Management to get the background of the employees, and to understand their anxieties and concerns. One-on-one meeting with in-scope employees. Setting up other channels of communication, like senior management meetings, in each location. Getting a buy-in from the management as well as the senior leaders of the in-scope employees on the process and communication to be done for a smooth transition. Providing detailed FAQs to address initial anxieties and queries that could come up Partnering with the company‘s management to ensure business ―as usual‖. Strong legal support through the entire transaction Some Examples Transition in UK arm of an American Company Application support handled by UK IT department of this company was outsourced to Infosys. The employees who were supporting these applications also transitioned to Infosys. Integrated 2 employees without impacting business. They transitioned along with their existing terms and conditions, some of which were not applicable to the Infosys employees. Infosys ensured that the employee transfer complied with all the requirements of the TUPE regulation in UK. Transition as a result of Product Acquisition Infosys acquired a product from a Financial Services company & the employees supporting this product application in UK & Japan, transitioned to Infosys. 22 employees in UK & 7 employees in Japan were integrated. The employee transfer complied with all the requirements of the TUPE regulation in UK, which included protecting their existing terms & conditions. Similarly in Japan. Their roles were mapped onto the existing structure at Infosys.

Transition from the Indian arm of a multinational bank The bank was out-tasking all IT activities of its Indian facility, along with its employees. The 3 point approach was – Migration planning, Vendor planning & Employee transition Infosys absorbed 28 full time employees of the bank as full time Infosys employees, without any screening process. Their roles, responsibilities, compensation and location were maintained 7. Customer Advisory Council

Infosys has a Customer Advisory Council (CAC). The CAC comprises a set of CxOs from our client organizations. Admission to the CAC is by invitation. The members of our CAC represent a cross-section of industry verticals that we see as strategically significant to the growth of our business. The charter of the CAC is to provide input and opinions on Infosys' strategy to our senior management teams. The objective is to bring the customer perspective into the strategy planning process. At the level of individual client accounts, our Relationship/ Engagement governance model includes mechanisms like Advisory Boards and Steering Committees that are drawn from senior executives of the client organization, as well as Infosys. The charter of these bodies is to ensure that the individual projects deliver on their goals and to monitor progress towards the goals of the larger program (if one exists). There are no fees associated with attendance of Infosys‘ events.

SUBCONTRACT AND THIRD PARTY VENDOR

Subcontracting Work Infosys does not make use of subcontractors for executing client projects. However, under certain circumstances (such as to fill certain short-term requirements, some specific skills, etc.), Infosys may take some consultants. All such consultants are inducted only after prior permission from client and after the Infosys Management is satisfied about the suitability of the person for the project, by way of interviews and/or tests. The consultants would work within the Infosys campus, as part of the assignment team. For all practical purposes, they would act/work as if they were Infosys employees. Process for working with third party vendors Vendor selection for IT investments involves sending a Request for Proposal (RFP) to prospective vendors giving details of configuration or specification of material and quantity required. Vendors respond to this by giving their quotations. Based on the selection of vendors at this stage, they will be invited to give a demo of their products, if required.

In case of consumables, vendor evaluation and selection is done every quarter or biannually, depending on the product. Quotations are invited for all the products required with quantities specified from both existing vendors and any new, prospective vendors. On receiving the quotations from the vendors, a comparison is done. The criteria of selection for vendors of both capital and revenue items include cost, delivery time, quality of products, reputation of the vendor and existing relationship. Based on these, the vendors are shortlisted and called for negotiations. The final selection is made after this. For revenue items, the price is frozen for each product and the final approved list is authorized by H-CCD (Head, Computers and Communications Division) and Purchase dept. During the year, the performance of the vendor is monitored.

The Services Model

MARKETING STRATEGIES

Independent Business Units When organizations face difficulty in managing divisional operations due to an increasing diversity, size, and number of divisions, it becomes difficult for the top management to exercise strategic control. Here, the concept of an IBU is helpful in creating an IBU-organizational structure. In multidivisional organizations, an IBU structure can greatly facilitate strategy-implementation efforts.

DELIVERY PROCESS

Target Markets

GDM Tools

Infosys has a complete set of proprietary processes, methodologies and tools for managing Application Development, Maintenance, and Package Implementation. These tools have been developed based on our understanding of the Global Delivery Model (GDM) and are an important component of our ability to develop, deploy and maintain applications globally, on-budget and on-time.

Activity Enterprise Architecture Modeling & Requirements Management Project Management Activity Tracking Issue Tracking Defect Tracking Senior Management Review

Tool

Update Frequency

InFlux™

Ongoing basis

IPM (Integrated Project Mgmt) DART Issue Tracker RADAR PRISM

Milestone Analysis

IPM

Quality compliance audits Defect Prevention Estimation / Revising estimation guidelines Training Requirements & Compliance Resource Allocation & Skill Tracking Requirements Management Project Management

Internal Audit System SPC PCB (Process Capability Baseline), Process Database

Project Scheduling Activity Tracking Issue Tracking Defect Tracking Senior Management Review Milestone Analysis Quality compliance audits

I-Lite PS-Web & People Knowledge Map InFlux™ IPM (Integrated Project Mgmt) MaST DART Issue Tracker RADAR PRISM IPM Internal Audit System

Ongoing basis Daily Daily Ongoing basis Once in the lifecycle Every Milestone & also on closure of the project Monthly Once per lifecycle stage As required Ongoing basis Ongoing basis Ongoing basis Ongoing basis Ongoing basis Daily Daily Ongoing basis Once in the lifecycle Every Milestone & also on closure of the project Monthly

Defect Prevention Estimation / Revising estimation guidelines Training Requirements & Compliance Resource Allocation & Skill Tracking Production Support

SPC PCB (Process Capability Baseline), Process Database I-Lite

Once a quarter As required

PS-Web & People Knowledge Map IPSP

Ongoing basis

Ongoing basis

Ongoing

Each of these are described below. In addition, please see Appendix 1 for details on Influx and IPSP:

Influx InFlux™ is a tool that can be used for modeling the client‘s business space & defining requirements. It has built-in templates & processes for various domains. This ensures that a holistic approach is adopted when defining a solution. It also reduces the time-to-market, by providing pre-defined aids to solution definition. Integrated Project Management (IPM) IPM is a one-stop Project Management tool for the Project Manager. All information pertinent to a project flows into IPM. IPM provides a ―Project Dashboard‖ to assess the health of a project. All project information, such as Project Description, Milestones, Technology, Project goals etc. are captured in this tool. Milestone & Post-mortem analyses of projects are based on the information of this tool. These analyses help the organization refine its capabilities. MaST MaST is a one-stop tool for scheduling & tracking a maintenance project. MaST is integrated with the other tools used during the project lifecycle, such as IPM, PS-Web, RADAR & DART. This allows tracking & reporting at the most granular level. The key features of MaST are  Web based tool with a central repository  Multi-user system  Seamless integration with Delivery tools like PS-Web, IPM, Dart, RADAR and Leave System.  Customized life cycle tasks  Request based tracking and scheduling  Ease in preparation of milestone reports and closure reports

DART (Daily Activity Report) DART is an intranet based tool used for tracking the time sheet of every person on a project. The tool tracks the time spent by a person on each of the activities the person is involved in. It is a real-time tool & tracking is automated, once the tasks are defined.

RADAR RADAR is a web-based tool used to record and track defects found in all lifecycle stages of the project. All data about defects – origin, severity, cause etc are tracked. This drives the Defect Prevention process, which ultimately helps in reducing defects by a process of structured learning from the past. PRISM PRISM is a tool used for project review by Infosys Senior Management. The Senior Management personnel involved in the review bring their experience to bear on the management process adopted in the project. This helps in improving key management areas such as risks, changes etc. ensuring adherence to schedule & budget. Internal Audit System This is a tool used by the Process Consultants (Quality Assurance) to track the compliance of a project to desired quality standards. This ensures that all processes relevant to the project are being followed. It, thus, enhances the predictability of the outcome. SPC (Statistical Process Control) This tool enables a statistical analysis of the defects occurring in a project. It is used for defect prevention activities. This ensures the quality of the delivered code & strengthens the application development process. Process Database / Process Capability Baseline These 2 tools are org-wide tools. They capture information on various parameters related to project execution. Conclusions are derived from the data & summarized. These conclusions provide guidelines for estimation. ILite Training of the people working on a project is a key-activity. Identification of training needs, technical as well as soft skills and definition of a training plan for each individual is done using I-Lite. The tool is then used to monitor compliance to the training plan. IPSP (Intelligent Production Support Platform) IPSP is a tool used in Production Support Assignments. This tool brings a structure to knowledge acquisition and diagnosis and also a formal way to store the acquired knowledge. Extensive usage of the tool ensures adherence to desired Service Level & also improvements in productivity over a period of time.

Packaged application implementation/ management The proprietary INSPIRE framework developed by Infosys around the lifecycle of a packaged application (from organizational assessment and package implementation through to rollouts and maintenance) aids in assessing the maturity level of the business processes in an organization. Infosys has developed a number of tools that enable an organization‘s business process to move from one level to higher levels of maturity. The following extract briefs the various tools available. Impact Analysis Kit The impact analysis kit comprises of configuration assessment templates for each level of maturity of the business process. This helps in analyzing the current configuration of the business process as compared to the expected configuration. The gaps between these two configurations could be identified that need to be bridged in order to take the business process to higher levels of maturity. Estimation Kit The estimation kit would be a by-product of Impact analysis. While the impact analysis kit identifies the gaps, the estimation kit meticulously analyzes each gap and what it takes to bridge these gaps. A detailed list of tasks would be identified and the effort required for completion of each task is estimated. The effort estimate could be used as a basis to arrive at the cost-estimate for the business process re-engineering. ROI toolkit With increasing skepticism on the tangible benefits of IT investments, the trend now is to evaluate the dollar returns on the IT initiatives to be taken up by the companies. Based on the rich IT implementation experience, Infosys has developed ROI toolkit that enables the evaluation of the dollar-returns arising out of the IT initiatives that take the business process to higher levels of maturity as per the INSPIRE framework. Upgrade toolkit In today‘s context, many organizations have already implemented enterprise packages to automate their business processes. The upgrade toolkit essentially aids in upgrading the enterprise packages to higher versions that improve the productivity, efficiency and effectiveness of the business processes. This toolkit encompasses all the templates and plans used in various stages of project management involved in a business process re-engineering exercise. It includes templates for scope assessment, estimation, requirements gathering, milestone analysis, user documentation and support & maintenance methodologies.

InTune For rapid upgrade of IT systems to higher versions of enterprise packages, Infosys has developed a tried and tested methodology called InTune. This clearly isolates the various activities that need to be carried out at different stages of package upgrade. InTune leverages the global delivery model of Infosys that delivers the values of lower total cost of ownership, faster time to market and superior quality of software implementation. InTune comprises of the following 5-phased approach to version upgrade distributed between offshore and onsite locations: 1. System Study and Solution Design Documentation on present setup, customizations and interfaces Draw up a list of tasks that can be automated 2. Offsite Trial Upgrade Documentation of new architecture Configure the new test environment Draw up list of customization, interfaces and transaction volume 3. Offsite Upgrade Draw up preliminary upgradation plan and test plan Revising and fine tuning the upgradation plan 4. Test Upgrade Finalize upgradation and test plans Checklist of onsite upgrade tasks 5. Production Upgrade Final upgradation plan on production environment Resources for system backup

IntERPryz ―IntERPryz‖ is the Infosys methodology for the implementation of enterprise-wide information systems, delineating a clear path for planning, executing, testing, and supporting the implementation process. Its modular and flexible approach covers all stages of an end-to-end implementation, and is based on our deep understanding of business requirements, continuous user training, and post-implementation support. It also leverages Infosys‘ proven strength in extending packaged solutions and enhancing their effectiveness through seamless integration of emerging technologies, so as to capture the unique business processes that differentiate the client from competitors.

An innovative and exhaustive tool for rapid implementation, the IntERPryz methodology harnesses the power of business with technology-enabled approach for effective integration of information and systems across the enterprise. It delivers optimal value by: Stressing accountability Integrating people, process, and technology Managing change effectively Invoking business transformation and not process automation

PRICING STRATEGIES

PRICING MODELS and LABOR RATE VARIATION The drivers for outsourcing solutions are in a state of flux today and differ drastically from client to client. Infosys approaches each client situation with a customized outsourcing solution pricing based on a consistent set of financial pricing and risk management models for the clients and for Infosys. We believe that our clients prefer the solutions approach we take to pricing. Starting from the client‘s preferences, such a pricing approach is driven by their current business drivers and strategic business goals. We customize our pricing model for each deal, deriving from the basic outsourcing pricing methods – Fixed Price or Time & Material. Value based and risk and reward components are incorporated into our pricing strategy where possible. As both the outsourcing marketplace matures and our clients have a better set of starting baseline metrics, we are beginning to drive more alternatives that add flexibility and agility to relationships emerging. Infosys does not believe in working with region wise differential labor rate. As a strategy, Infosys operates in a deliverables based pricing dynamic. As a practice Infosys works under the principles of value based pricing instead of differential labor pricing. By taking a solutions pricing approach to each deal, Infosys has created innovative financial models based on client‘s concerns and requirements. It is imperative to note that from a delivery perspective, pricing for outsourcing services – especially applications outsourcing with a global delivery model – has been based on rate cards associated with the location where the service is being delivered from. These could be: Onsite Offsite Near-shore Offshore A practice emerging in the context of the global delivery model is the concept of Blended rate structures – independent of delivery location. Infosys does not favor this model as the model does not create any incentive for the client or for Infosys to enhance the utilization of lower-cost offshore locations, and thereby reduces the value of the Global Delivery Model to the client. The Infosys preferred method for outsourcing pricing, especially with more mature clients, is a fixed price measured against an agreed set of service level agreements. Year to year improvement on productivity are committed upfront. Infosys takes the risk of meeting these committed prices while having freedom to move work offshore – provided service levels are met. This allows Infosys to continue to evolve the GDM and

Formatted: Bullets and Numbering

gives the customer predictable cost of service with year to year improvements. This approach also accelerates the GDM maturity for the client moving them quickly to management of deliverables not resources, and full exploitation of CMM quality processes.

Apart from the delivery options, another very important factor in deciding the best pricing model is the scale and complexity of the client‘s outsourcing portfolio and the maturity level each client‘s baseline metrics. The organizations with a well laid out strategy of outsourcing are in a position to foresee their requirements over the years and therefore are in a position to negotiate value based deals better. The deal can be structured in one of the popular models (which constitute 80%-85% deals) or more innovative, value based pricing models which are now coming into vogue as the industry is maturing.

Primary Pricing Models Infosys has used a variety of pricing models in its contracts. Historically the pricing models that have been most popular are: Deliverables based Time and Material Client is billed based on a pre-negotiated hourly or monthly rate structures. Payments are received based on meeting pre-specified deliverables / deadlines. Infosys is reimbursed at cost for materials used or other costs incurred, such as travel expenses. It is important to note that this is an extension of the contracting pricing model used for ―staff augmentation‖ and a structure that many of the less mature clients continue to prefer while engaging with an outsourcing service provider. Even within this structure, Infosys takes greater ownership of risk by providing effort estimates and fixed price bids based on a pre-negotiated rate. In such cases, Infosys takes on the risk of the delivering engagements to these estimates providing the risk cover of the fixed-price model even while engaging with a time & material pricing structure. Fixed Price Infosys is paid a fixed price decided at the beginning of the project. This approach is predictable and convenient. Service level credits can also be used with this pricing mechanism. Dedicated Offshore Development Center: In the ODC model, Infosys dedicates resources to the center and customer-specific knowledge is retained and leveraged. Infosys develops customized recruitment and training programs and a specialized management regime and infrastructure for the center. Our large centers occupy entire buildings that are dedicated to the customers they serve. Over time, an application-specific relationship could evolve into a center, as new applications are added to the Infosys portfolio. An Offshore Development Center provides the scope of delivering an integrated offering to the clients wherein the cost of dedicated infrastructure and resource management is built into the contract. Within an ODC framework, Infosys engages with clients using the variety of pricing models – such as the basic models discussed above as well as some of the emerging value-based and risk-reward models.

Applicability of Pricing Models For applications where there is not enough service level data to allow adequate scoping up front, Infosys recommends using T&M billing for the first 3-9 months, until enough data has been assembled to allow a transition to Fixed Price. Where sufficient data exists, Infosys bids projects on a Fixed Price basis from the beginning. If multiple applications are to be outsourced as a group, a dedicated Offshore Development Center (ODC) may be preferable. In many deals, we will fix-price the transition and knowledge transfer phase, which includes the baseline gathering and metric setting work, and be in a position to commit to the final fixed price after the transition phase. In other cases, the work content is scoped well enough by the client to allow us to fix price both the transition phase and an ongoing fixed price deal, but final year to year productivity commitments and related pricing variations tied the fixed-price deal get locked in after transition. The driving factors are flexibility for the client and speed to respond to a solution offset by the amount of scoping metrics and time allowed.

Value Based Pricing The complexity and differences between each client‘s business drivers and strategic intentions for a global sourcing strategy, limit our ability and desire to deliver canned pricing approaches. As a solutions-focused company we look for innovative pricing mechanisms within each deal to find opportunities to offer value based pricing to customers. This approach requires us to understand the requirements of the client and propose an appropriate solution rather than offering our services and asking them to select one or more of them. Selling solutions has provided us with opportunities for value based rather than cost plus pricing. Among the types of pricing included under Value Based Pricing are – Gain Sharing, Shared Risk / Reward, Business Benefit based. Gain-sharing or incentive pricing This model bridges the gap between IT operations and business results by offering the outsourcer a stake in savings or revenue. It differs from outsourcer incentives, such as service-level credits or bonuses for exceeding expectations, in that it links rewards to tangible business benefits—such as lower operating costs. Some of the examples of gain-sharing engagements at Infosys include: Sharing of cost-savings realized by the client for a pre-defined period, based on Infosys‘ ability to reduce the total cost of operations for an application. Sharing of cost-savings based on Infosys‘ ability to consolidate multiple redundant applications within a clients‘ portfolio. Shared Risk / Reward Infosys and the service receiver share the cost of developing the service or project, as well as the subsequent revenue (based on pre-defined goals and sharing ratios) generated by the new product or service.

Risk / Shared Reward Infosys bears the full cost of developing the service or project, and while sharing the reward, commands a larger portion of the first year revenue generated by the new product or service. The client can expect full reward value in the out years. Business-Benefit-Based Infosys is paid in proportion to the business value generated by the project or service, such as a percentage of increased profit or decreased cost. Other factors that affect the pricing include deal size, complexity, and associated risk. Risk includes penalties and likelihood of success and exposure, both public and financial.

Variable Pricing Models In the recent past, Infosys has started offering variable pricing models to clients, structured in multiple ways. While pay-per-use pricing is gaining early acceptance for large, infrastructure outsourcing, the use of such utility pricing models for applications outsourcing is yet to evolve and depends on and whether the applications lend themselves to be defined in the form of unit prices.

Following are some examples proposed by Infosys for variable pricing to clients:

Pricing for Vanilla Services This involves taking up application portfolio maintenance at a fixed cost and committing to re-align or optimize the portfolio on this fixed price / fixed time basis.

Risk and Reward Services This involves 2 variations – MTTO (Modernization through Temporary Transfer of Ownership) and Subscription. The basic premise is that Infosys will take ownership of the portfolio maintenance and will, over a period of time (say 3 years) modernize the application. Infosys will partner in sharing the initial cost required for this and recover over a period.

Ownership Services Infosys has offered three variations of this pricing model – Sustenance Ownership, Application Portfolio Ownership and Business Process Ownership. These services involve Infosys taking ownership of the portfolio at an application, application + infrastructure OR at the Business Process level and taking responsibility for the evolution of the portfolio in line with changing needs for the client.

These models are depicted in the diagram below:

Business Process Ownership

Level 6

Appln. Portfolio Ownership

Level 5

Sustenance Ownership

Level 4

Subscription

Level 3

MTTO

Level 2

Vanilla Maint. & Re-engg

Level 1 Low

Partnering in Risk

High

The diagram below summarizes the pricing models currently used at Infosys for different offerings:

Pricing Models Offerings

T&M

Consulting & IT Strategy

Custom Application Development

Labor Rates

Application Maintenance

Labor Rates

Reengineering and Migration

Labor Rates

Package Implementation

Labor Rates

FP Fixed Project Bids Fixed Project Bids Fixed Operating Costs Fixed Project Bids Fixed Project Bids

Value Based Business Outcomes Shared Risk/Reward Ownership / Subscription Gain-sharing

Infrastructure Management Services

Business Process Outsourcing

Labor Rates

Fixed Operating Costs Fixed Operating Costs

Gain-sharing

Gain-sharing

Labor Rate Variation Infosys works on a business model based on global delivery (the Global Delivery Model). This model is based primarily on our ability to offer solutions and services from a backbone of strong program management capabilities and domain competencies, seamlessly across locations. Our responsibility for the successful execution of a client project is not at a resource level, but at a value-delivery level. Thus, most of our projects are based on an output/ outcome based or deliverables-based model, and not on a resource-based or FTE-based pricing. This extends to encompass all our ‗Time and Materials based‘ projects where we use pre-negotiated rates and transparent effort estimations, where Infosys takes SLAs on

estimation accuracy and effective use of the Global Delivery Model. Level One Focus on…

Inputs

Pricing

Labour based

Base Mix (Infosys)

Not Offered

Value Drivers

Level Two Inputs Resource-based

Quality of people Onsite-offshore ratios Rapid ramp-up/ down Estimation accuracy

55%

Level Three

Level Four

Outputs

Outcomes and Ownership

Fixed price/ Performance- based

Risk/Reward, Gainsharing, Value-based

35%

10%

Estimation accuracy Productivity Quality Timeliness of Delivery

Risk- sharing

Infosys operates here Other offshore vendors operate here Value to Customer

Deliverablesbased project outsourcing Onsite Staff Augmentation

Business solutions/ Portfolio Ownership

Offshore Staff Augmentation Scale and Complexity

Capabilities

Skilled workforce Cost advantage Legacy skills Offshore staff

Strong execution Quality excellence Project Management Committed delivery Global Delivery Model

Solution innovation Domain and Consulting skills Investments into R&D Program and Client Management End-to-end services

While there are obviously differences between the rates for both technical as well as managerial staff from region to region, these are variables that reflect in our internal costing rather than directly as a rate-perresource that we charge to clients. Indicative Rates:

Continental Europe

APAC (Varies by Region)

Offshore India

Offshore China (predistomer ucted rates) 1.2 x

US

UK

Developer

(2.5 – 4) x

(2.5 – 4) x (3 – 4.5) x

(2.5 – 4) x

x

Project/ Program Manager

(3 - 5) x

(3 - 5) x

(4 - 6) x

(3 - 5) x

(1.5 - 2) x 2 x

Architects/ Specialists

(5 - 6) x

(5 - 6) x

(5 - 6) x

(5 - 6) x

2x

---

(6 - 10) x

(6 - 10) x

6x

---

---

Business Process/ Strategy (6 - 10) x Consultants x = Base rate

PROMOTION: Long Term Customer Relationship Management Participate in Trade Fairs, Seminars, Webinars and Events Infosys Blogs, Social Networking – Twitter, Micro Sites Print Ads – Eg: Finacle and Sexual Harassment Awareness Public Relations – Press Releases and Publicity

Growth over the years

Revenues ($ 4568mln) - LTM September 30, 2009

Financial Performance Over $28 Bn in market capitalization on the NASDAQ (as of September 30 09) Zero debt company with sound cash reserves, and a de-risked operating model Financial reporting under Indian GAAP and IFRS. 98% repeat business as on September 30 2009 as compared to 99.8% during previous year. Strong client addition - added 35 clients during the quarter ended September 30 2009. Stable short-term liquidity position. Infosys policy is to maintain liquid assets at a minimum of 25% of revenue and at a minimum of 40% of total assets i.e. fixed assets, investments, net current assets and other assets.

Revenue breakup (by service, geography as well as vertical)

REVENUE BY INDUSTRY

% of revenue (30-Sep-09)

Insurance, Banking & Financial Services

33.5

Insurance

7.4

Banking & financial services

26.1

Manufacturing

19.3

Retail

14.1

Telecom

16.2

Energy & Utilities

5.9

Transportation & logistics

2.3

Services

5.0

Others

3.7

REVENUE BY GEOGRAPHICAL SEGMENT

% of revenue (30-Sep-09)

North America

65.9

Europe

23.2

India

1.2

Rest of the world

9.7

REVENUE BY SERVICE OFFERING

% of revenue (30-Sep-09)

Development

18.1

Maintenance

22.7

Business process management

6.2

Consulting services and package implementation

23.8

Infrastructure Management

7.8

Testing Services

6.2

Product Engineering Services

2.3

System Integration

4.4

Others

4.4

Total services

95.9

Products

4.1

Total revenues

100.0

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