印孚瑟斯Infosys Ltd. (INFY) 2002年年度報告「NYSE」.pdf

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1、1Managing enterprises in challenging timesAdversity has the effect of eliciting talents,which in prosperous circumstances would have lain dormantHorace(65 8 BC)It is easy for reasonably well-managed companies to do brilliantly in great times.Revenueskeep increasing with little managerial stretch;the

2、 creeping flab does not come in the wayof growing profits;earning targets are exceeded every quarter;and price-earning ratiosbecome stratospheric.The business model seems to work without a hitch.The real qualities of a company come to the fore in tough times.The stamp of anoutstanding enterprise is

3、in how it successfully uses adversity to alter,re-engineer andsimultaneously grow its businesses.Great companies anticipate shocks and downturns.Managements dig deep into their skill-sets and creativity to design solutions that candeliver in the face of difficulty.Every employee redoubles efforts to

4、 drive growth andprofitability not due to the fear of failure,but because of the yearning to win.Inviolatecore values are re-affirmed;business teams rejuvenated;innovations tumble out of longunused recesses of the mind;and adrenalin pumps like never before.There is a burningdesire to show that it ca

5、n be done that the greatest battles can be won in the face ofhardship.This year has been most demanding for the software industry,and we believe that thechallenges and discontinuities will be with us in the future.We therefore think it will beuseful to share with you how Infosys is dealing with this

6、 environment.2ContentsThe year at a glance3Managing enterprises in challenging timesBack to the basics:Imperatives for the technology services industry S.D.Shibulal4Leading the globally-competitive corporation Claude Smadja6Creating a flexible financial model Marti G.Subrahmanyam8Technology the comp

7、etitive differentiator Phaneesh Murthy10Awards for excellence 2001-200213Letter to the shareholder17Directors report20Financial statements prepared in accordance withIndian Generally Accepted Accounting Principles(Indian GAAP)Selective financial data40Managements discussion and analysis of financial

8、 condition and results of operations42Auditors report58Balance sheet60Profit and loss account61Schedules62Statement of cash flows79Balance sheet abstract and companys general business profile81Risk management report82Corporate governance report88Shareholder information101Additional information to sh

9、areholdersFrequently-asked questions106Share performance chart110Intangible assets scoresheet111Human resources accounting and value-added statement114Brand valuation115Balance sheet(including intangible assets)117Current-cost-adjusted financial statements118Economic Value-Added(EVA)statement120Rati

10、o analysis121Statutory obligations124ValueReportingTM125Management structure126Financial statements prepared in accordance with United States Generally AcceptedAccounting Principles(US GAAP)Summary of selected consolidated financial data128Managements discussion and analysis of financial condition a

11、nd results of operations129Report of management141Independent auditors report141Balance sheets142Statements of income143Statements of stockholders equity and comprehensive income144Statements of cash flows145Notes to financial statements146Information in Form 20-F of United States Securities and Exc

12、hange Commission157Infosys Foundation188Financial statements(unaudited)prepared in substantial compliance with GAAP189requirements of Australia,Canada,France,Germany,Japan and the United Kingdomand reports of compliance with respective corporate governance standardsAnnual General Meeting(AGM)notice3

13、The year at a glancein Rs.crore,except per share dataMarch 31,2002%March 31,2001%Growth%For the yearTotal revenues2,603.59%1,900.56%37)Export revenues2,552.47%1,874.02%36)Operating profit(PBIDT)1,037.63%764.84%36)Profit after tax(PAT)from ordinary activities807.96%623.32%30)Profit after tax and extr

14、aordinary items807.96%628.81%28)PBIDT as a percentage of total revenues39.85%40.24%PAT from ordinary activities as a percentageof total revenues31.03%32.80%Earnings per share(from ordinary activities)Basic122.12%94.23%30)Diluted121.37%93.93%29)Dividend per share20.00%10.00%100)Dividend amount132.36%

15、66.15%100)Capital investment322.74%463.35%(30)PAT as a percentage of average net worth46.57%56.08%At the end of the yearTotal assets2,080.31%1,389.64%50)Fixed assets net718.24%557.66%29)Cash and cash equivalents1,026.96%577.74%78)Working capital1,293.41%797.86%62)Total debt%)Net worth2,080.31%1,389.

16、64%50)Equity33.09%33.08%)Market capitalization24,654.33%26,926.35%(8)Market capitalization is calculated by multiplying the share price at the National Stock Exchange on March 31of the respective years and the shares outstanding as on that date.4The last two years have witnessed an unprecedented uph

17、eaval in the technology sector.The rapid increase in high-tech manufacturing capacity,the resultant pile-up of inventories,the demise of companies that depended excessively on this segment,the Internet bubbleburst,the near-halt in technology-financing activities these are now behind us.However,a lin

18、gering impact of these events is that technology investments by large corporations arevery different from the ebullience of the late 1990s.Growth rates have slackened acrossindustries and,consequently,corporate appetite for new technology initiatives hasdiminished.These are challenging times for the

19、 technology services industry.In fact,given the cautionin IT spending,growth rates across this sector have dropped.Moreover,client expectationson quality,cost,timeliness and service have increased,leading to margin pressures onservice providers.Consequently,the near-term outlook on corporate perform

20、ance in thissector is not optimistic.However,technology services companies that adapt their business models to these difficulttimes will emerge as winners in the marketplace.Business history is replete with cases of how companies,often faced with a bleak operating environment,successfullytransformed

21、 their business models to emerge stronger.Southwest Airlines transformed its business model through arelentless focus on operating efficiency.Today,it has an undisputed claim on cost leadership in the US market.Thetransformation of IBM under the leadership of Lou Gerstner has been widely chronicled

22、and acclaimed.Anotherstriking example of corporate transformation is that of GE under the guidance of Jack Welch.His“No.1,No.2,fix,close or sell”approach followed by a passionate adoption of globalization,market expansion through services andSix Sigma quality created unprecedented value for GE share

23、holders.More recently,GEs adoption of an e-businessstrategy has yielded benefits that easily qualify to be the envy of traditional corporations.Today,while there are several high-quality players in the Indian technology services industry,their strengths arelimited to a subset of operating parameters

24、.Technology services companies need to develop an industry-definingbusiness model.I have outlined ten essentials of this model below.11.The ability to understand a clients business,to identify process pinch-points,and to introduce a credible technologysolution through a consultative engagement addre

25、ssing a business problem.Unlike many of their global counterparts,most Indian IT companies have a long way to go in developing these skills on a large scale.High domainexpertise and a deep-seated culture of client focus in every transaction are the key attributes here.12.A disciplined approach to ma

26、naging topline visibility.A healthy portfolio of contractually assured open orders,relationship-driven revenue expectations,and one-off engagements is critical.Most Indian companies havebegun to address this only as a reaction to the downturn.13.The ability to maintain skill-sets on a wide spectrum

27、of technologies while ensuring depth that defies easy replication.This could range from the very latest technologies to niche,archaic platforms that have a scare supply of skilledpersonnel.14.A de-risked presence across industry verticals.Given the vicissitudes of business cycles,a significant prese

28、nce incounter-cyclicals can go a long way in ensuring revenue stability.Some of these markets can be difficult to sellto and have therefore not seen adequate penetration efforts by Indian companies.15.SEI-CMM Level 5 quality processes,execution capability for large multi-year engagements,and sophist

29、icated alliancemanagement for delivering value to clients.Execution capabilities and quality frameworks need to includequantification of payoffs to the client from technology initiatives.Further,the ability to manage large engagements,often leveraging alliances in the process,is critical.16.Credible

30、 global delivery capability.Globalized execution of engagements requires adequate talent and infrastructurein different parts of the world.Further,robust distributed project management methodologies are critical forproviding high-quality,rapid time-to-market and cost-effective solutions.17.The abili

31、ty to attract and retain high-quality people.Credible and widespread employee equity ownership,achallenging and empowering work environment,world-class physical and technical infrastructure,sensitizationto a global workforce,rigorous and ongoing training programs each of these is necessary for a tec

32、hnologyservices company to be an employer-of-choice.S.D.ShibulalExecutive Director,Infosys,and Head Customer DeliveryBack to the basics:Imperatives for the technology services industry518.Corporate integrity.Transparency and corporate governance not only attract global capital,but also build credibi

33、litywith clients,especially in these turbulent times.Stakeholders put a premium on companies that they can trustto be fair and transparent in their dealings.19.Flexible,client-focused organizational structures.A matrix structure that harnesses the right resources from acrossthe organization for clie

34、nt engagements is critical.In large organizations,formal processes that encourageteamwork among disparate groups through collaborative selling and execution are vital.10.A globally-respected brand.In addition to operating excellence,this requires well thought out image-buildingefforts.For Indian com

35、panies,the ability to derive high value per marketing dollar is especially critical.Further,thought-leading publications specific to technologies and industry verticals are a powerful means to establishinga credible brand.The world-wide drop in economic growth has,for the first time in recent years,

36、exposed the chinks in the businessmodels of technology service companies.The above ten elements,in my opinion,are key to the sustainability ofsuperior corporate results in this business.Finally,in the long term,industry players that use the slowdown as anopportunity to make their business models mor

37、e robust and focus on excellence in execution will emerge as thewinners of tomorrow.6Never before have CEOs been confronted with such extensive challenges,and been undersuch unrelenting pressures.Of course,it has already been several years since the combinedimpact of globalization and the IT revolut

38、ion drastically changed the role of the CEO andthe manner in which this new role was fulfilled.But,recent developments have createdadditional demands that make the CEOs job look something like“mission impossible”.Successfully managing enterprises today requires CEOs to reconcile the pressures of alm

39、ostinstantaneous responses to very fast moving developments in the technological,financialand business environment,with the steadiness and calm required to remain focused onlong-term strategic priorities and imperatives.They need to not only lead and inspireteams that are entrepreneurial,innovation-

40、driven and aggressive in acquiring new markets,but also to fulfil the highest quality standards and to reflect a set of core social values.Infact,managing a global company today means being able to fully meet the new expectationstowards the corporation and its top management.What are these expectati

41、ons?The first that comes to mind is the need for even greater transparency.Any corporationwhich falls short of creating the conditions that will convince shareholders and investors that the most stringentaccounting standards and best practices of corporate governance are met is bound to pay a heavy

42、price for such afailure.Todays corporation has to consider itself permanently open for inspection.Of course,one can see here the fallout of the Enron debacle.But,the trend towards transparency predates Enron.Two developments were becoming more and more apparent since the mid-1990s.First,global finan

43、cial marketswere going beyond the quality and reliability of the product or service delivered by the corporation.By the end ofthe 20th century,quality and reliability were taken as given.What has come increasingly into play is the image andreputation of a corporation,its social standards,and its cor

44、porate culture.Second,we have seen a perceptible shift in power from management to shareholders and other stakeholders who arebeing more assertive and are demanding greater say in corporate strategy and decisions,including those that affectthe financial health and viability of companies.While these

45、developments have occurred first in the United States,they have gained significant ground in Europe,and are beginning to be felt more and more in Asia and LatinAmerica.These two factors have an impact on the image and positioning of a CEO.No doubt,corporate fashions come andgo.Yet,we seem to be movi

46、ng from the era of the CEO Superstar or Superman,to one where the CEO would ratherbe celebrated as the gifted conductor,with the ability to set the orientations of a company and also help bring out thebest from each member of the team,and each component of the entity known as the“corporation”.Anothe

47、r expectation regarding the corporation and its CEO is the ability to assess and manage new dimensions ofrisk in an ever-changing global business environment.Of course,financial and technological risks have always beenpart of the matrix of any CEO.But,today,these assume a new dimension.For one,globa

48、lization has definitelyincreased the prospects for financial volatility.For another,the processes of Schumpeterian“creative destruction”areoperating at much greater speed because of time compression,lesser transactional friction,and vastly reducedability of governments to erect protective walls.Risk

49、s facing corporations are no longer additive.They are highlymultiplicative,with complex feedback mechanisms and much greater powers of wreaking havoc.But these are not the only risks.What is becoming increasingly important is top managements ability to detect andassess what might be called the globa

50、l risk.How do we identify what are seemingly unrelated factors which,whenthey configure in certain ways,can create shockwaves affecting financial and business conditions in the farthestparts of the world?In more ways than one,todays CEOs of large global corporations need to pay as much attentionto g

51、eopolitical considerations as they normally do to efficiency,productivity and economic rationality.There is afairly substantial list of global corporations that,in recent years,have paid dearly for their failure to detect emergingglobal social and political trends.Beyond these requirements,the globa

52、l CEO must have the capability to master,to embody and to leverage for thebenefit of the corporation three additional components of power.First,knowledge power,or the ability to detect and encourage the kind of technological innovations that will notonly allow the corporation to remain ahead vis-vis

53、 the competition,but also ensure that every element of existingtechnology and knowledge capital at the disposal of the company is optimally leveraged to achieve maximumprofitability.In more ways than one,a key function of todays CEO is to be an inspiring Chief Knowledge andInnovation Officer of the

54、corporation.There is no underestimating the centrality of this inspirational role in thecontext of the knowledge-based global economy of the 21st century.Claude SmadjaIndependent Director,Infosys,and President,Smadja&Associates:Strategic AdvisoryLeading the globally-competitive corporation7Second,th

55、ere is the issue of networking power.Through his/her actions and ability to develop and nurture newstrategic linkages,the CEO will have to be at the center of a web of complementary networks that can extend thecapabilities of the corporation,root it even deeper in the social context from which it dr

56、aws strength and legitimacy,and further the reach of the company by consolidating its image in a world where branding and intangibles havebecome important components in defining corporate value.This implies the ability to manage and expand a systemof very complex and sometimes contradictory relation

57、ships,and to use them for the ultimate benefit of the corporation.Third,there is communication power.At the very least,this involves the capability to deliver messages that contributeto the sustainable value of the corporate brand.More profoundly,it means being able to integrate other groups andcons

58、tituencies beyond employees and shareholders in the strategic goals pursued by the corporation,in its valuesand the vision it develops for itself,and in the role that it can play at the national and global levels.Here again,therole of the CEO as the Chief Communication Officer cannot be underestimat

59、ed.This communication often as adaily exercise is the way in which the corporation asserts its position as a creator of wealth and innovation,as wellas a repository of social,economic and ethical values.Looking at the complexity of tasks required of CEOs,at the ever-increasing and sometimes contradi

60、ctory expectationsput on them,and at the wide range of qualities demanded of them,it is not surprising that CEOs today are witnessinga sharp reduction in their professional life expectancy.The real wonder and the source of strength of the marketeconomy is that growing complexities and increasing pre

61、ssures and expectations are proving to be additional incentivesin attracting greater and greater numbers of would-be entrepreneurs and CEOs in their attempt to meet the never-ending challenge of value creation.And,the fact is that the opportunities for meeting and besting this challenge have never b

62、een greater than in todaysknowledge-based global economy.8After an extended period of unprecedented growth and soaring stock market values in the1990s,the sharp downturn in the new millennium has come as a rude wake-up call tocompanies around the world.During the long boom of the 1990s,many people b

63、elievedthat business cycles were things of the past.Economic events of 2001 and the first quarterof 2002 have proved the optimists wrong.In spite of the tremendous advances in technologyover the past decade,the business cycle is very much alive,and it affects companieseverywhere.To be sure,better us

64、e of information technology in the future may keep inventories andexcess supplies in check and,thus,reduce the length and intensity of economic downturns.But,there will be booms and busts.And,the question facing companies in practicallyevery sector from core industries such as steel to software serv

65、ices in the technologysector is how to equip themselves for such downturns,present and future.Even companiesand industries that have good long-term prospects need to prepare themselves for survivalin recessions.A key element of a strategy for survival and even rejuvenation in a downturn is a flexibl

66、e financial framework withinwhich a company operates.In bad times,a company needs to cut its costs,protect its revenues,and also have acushion to fall back on to weather the vicissitudes of the downturn.Indeed,the most flexible and nimble playersmay gain a competitive edge over their less agile riva

67、ls in such times.There are several determinants of such financial flexibility:?Low operating leverage?Low financial leverage?High liquidity?High operating margin?High agility in augmenting revenues?Total transparency in financial transactionsAlthough these factors are not all completely within the c

68、ontrol of a company,corporate managers enjoy considerablelatitude in structuring their business to maximize financial flexibility on each of these fronts.How do these factors contribute to the financial flexibility of a corporation,and how can managers improve theirperformance on each of these dimen

69、sions?Low operating leverage.If this ratio is high,the fixed payout burden is relatively large,and the corporation will face agreater adverse impact in the event of a downturn.To illustrate the importance of this factor,consider the steelindustry,which has a high fixed cost component due to large ca

70、pital requirements.In the current recession,moststeel makers are getting hurt not only because their revenues do not cover their costs,but also due to their limitedability to reduce these fixed costs.In contrast,POSCO of Korea reduced its operating leverage by sub-contractingpart of its manufacturin

71、g,and building on substantial economies of scale in its key operations.It continues to beprofitable,and has even increased its earnings in the current recession.Low financial leverage.The higher the financial leverage,the greater is the fixed burden of servicing the debt.A corporation that is alread

72、y burdened by the stresses of reduction in revenues is affected even more adversely,because of the need to meet the pre-committed debt payments of interest and principal.A combination of highoperating and financial leverage makes it a“double-whammy.”This is what has badly affected most large compani

73、esin the global telecommunications sector such as France Telecom and Deutsche Telekom.Global Crossings is anextreme version of this problem,and had filed for bankruptcy earlier this year.In contrast,Hutchison Whampoa,the Hong Kong conglomerate with extensive telecommunications holdings,is using its

74、low leverage to pick uptechnologically-valuable assets at bargain-basement prices.High liquidity.Companies that carefully husband their cash resources in essence create negative financial leverage have a much better safety net to face a downturn.The networking giant,Cisco Systems,is feeling the pinc

75、h of therecession like every other technology company,but with over US$20 billion in cash and marketable securities,it iswell equipped to last out a prolonged recession.It may even be able to buy assets and companies at attractive prices.Hence,high liquidity combined with low financial leverage beco

76、mes an important strategic tool when times arehard.Creating a flexible financial modelMarti G.SubrahmanyamIndependent Director,Infosys andCharles E.Merrill Professorof Finance,Economics andInternational Business,Stern School of Business,New York University9High operating margin.While the first three

77、 factors affect the cost side of the equation,this fourth feature deals withthe cushion between the revenues and the costs.An example of high operating margins is the Indian IT servicesindustry,which has demonstrated its financial flexibility in the current recession.The best companies in this indus

78、tryhave been relatively better equipped to weather the storm because they can face the dip in revenue growth withoutdigging too deeply into their cash reserves.High agility in augmenting revenues.When business conditions are adverse,there is tremendous pressure to maintainand even augment revenues.T

79、his involves all the tools of marketing,including aggressive pricing,brand loyaltyaugmentation,and customer relationship management.Wal-Mart Stores,the giant retailer,has managed to grow bydouble-digit percentages through a combination of these strategies,even in the current period.Total transparenc

80、y in financial transactions.When times are good as they were during the dot-com boom only threeyears ago very few questions are raised about the financial practices of corporations.In downturns,the capitalmarket becomes much more demanding,and it becomes more difficult for companies to raise externa

81、l finance.Firms that adhere to the best practices of corporate governance and follow transparent processes in all their financialdealings are more likely to be able to raise capital,should they need it,in a down market.This factor is very much atwork even in the ability of countries to raise externa

82、l finance:witness the problems faced by Argentina,and thedowngrading of Japan,an erstwhile strong economy.Recent accounting scandals in the United States and elsewhere,involving companies such as Enron,highlight the importance of this factor.And,it could be argued that evencompanies that have a viab

83、le long-term model may be dragged into default and even bankruptcy,because theirfinancial dealings are under a cloud.Berkshire Hathaway,on the other hand,enjoys a substantial premium over thevalue of its portfolio holdings,in large part,due to the“clean”reputation it enjoys under Warren Buffet.How c

84、an a corporation improve its performance in each of these dimensions and hence its financial flexibility?While there are constraints imposed by technology and the market in certain industries,most firms can still undertakeactions to improve their flexibility.For example,a company can reduce its oper

85、ating leverage by outsourcing serviceswhere it has little or no competitive advantage.It can improve its operating margin by moving to lower cost locations,as the apparel industry has done successfully in the past decade.Firms in industries with intrinsically high operatingleverage can use debt more

86、 judiciously,so as not to exacerbate the overall fixed commitments they make.Lastly,allfirms can improve their performance by being more transparent in their financial transactions so that investorsrespond favorably when they need to tap the capital market.10As companies prepare for the next leg of

87、competitive differentiation,a central issue thatneeds to be addressed is the role of technology in creating and sustaining that delineation.The truth is that todays business leadership is increasingly being technology-driven.CapitalOnes Information-Based Strategy(IBS),GEs Global Supplier Network(GSN

88、),Wal-Martsweb-enabled sales support network for its 35,000 stores,and Dells integration of assemblyoperations with external logistics these are all compelling examples of technology-drivenleadership.At Capital One,a proprietary Information-Based Strategy(IBS)drives continuous productand marketing i

89、nnovations by allowing the company to test over 100,000 narrowly-definedcustomer segments,and to develop unique product combinations to profitably servicethese niches.The success of this program is in the numbers compared to those of theirpeers 40%annual revenue growth versus 8%to 10%for peers;26%an

90、nual growth inloans versus 6%to 8%for peers;and a charge-off rate that is 200 basis points better thanthe industry as a whole.GEs Global Supplier Network(GSN)handles a global network of 36,000 suppliers and supports over 25 divisionsof the company.GSN handles over 40%of the corporations annual spend

91、ing and more than 90%of the billing.Thishas helped GE improve its on-time payments by 10%.The tangible benefits realized by GE through his technology-driven program are far more significant savings of US$1.6 billion in 2001,with estimated savings of over US$10billion in the coming years.Such efficie

92、ncy in managing costs has helped GE to sustain earnings growth despite theeconomic downturn.As we look at what constitutes such technology-driven leadership,we believe that enterprises can evolve throughmultiple levels not only in technology sophistication,but also in associated levels of strategy,p

93、rocess,and organizationmodels.The“Enterprise Evolution”path developed by Infosys provides a guiding framework to realize such a leadership.The Enterprise Evolution ModelThe Enterprise Evolution Model can help a company define an evolution path from cross-functional processes atLevel 1 to a dynamic v

94、alue chain at Level 4.The guiding principle of this evolution is to enhance the scope ofenterprise optimization,based on specific business drivers and objectives.Invariably,IT is the pivot to extend reachand to consolidate resources not just across functions,but also with a focus on corporation-wide

95、 asset optimizationand value-capture.Technology the competitive differentiatorPhaneesh MurthyExecutive Director,Infosys,and Head Sales&Marketing,and Communication&ProductServicesMost companies,that we have analyzed at Infosys,including some of todays technology leaders,are at Level 2 withsome charac

96、teristics of Level 3.Level 3 is a significant shift from value extraction to value creation by drivingindustry value shifts.Enterprises at this level earn disproportionate profits relative to other players in the industryvalue chain through cross-enterprise optimization that sharply increases the sw

97、itching costs for customers andsuppliers.The ultimate goal at Level 4 is dynamic innovation on the fly what we call“Dynovate.”At this level,firms will be able to configure and re-configure the value chain for each transaction,in real time.11Each level of evolution varies along business,process,organ

98、ization,and technology dimensions.For example,thefocus of strategy in an organization must change from“core and context”ambiguity to extensive outsourcing,tightlyintegrated cross-company partnering,and eventually dynamic value chain optimization.Transaction models willhave to evolve from“one-size fi

99、ts all”to“pay-by-the-drink”,and then to event-driven transactions across dynamicpartners.Process sophistication must shift from definition and measurement to continuous improvement and SixSigma not only within an enterprise,but also across adjacent partners and eventually multiple value-chain partne

100、rs.Such evolution implies a shift in enterprise technology capabilities from widespread information sharing and earlyenterprise-wide integration of today to value chain optimization,and event-based,transaction-specific,anytime-anywhere technologies.These technologies will enable organizations to evo

101、lve from classical line and support functionsto distributed work models,where the home of enterprise intelligence will move from the center to the nodes,andeventually reach a stage where the intelligence is carried in the network.As enterprises chalk an evolution path for themselves,we observe that

102、misalignment of business and organizationrelative to technology is the crux of the issue.Challenge of enterprise evolution:The highest leverage pointThe highest leverage point for many of todays Global 2000 firms is also an opportunity to move from“the corporatemany”that have sufficiently high techn

103、ology maturity to“the select few”that apply this technology maturity withhigh business maturity.Getting there,however,requires corporations to closely examine where they are today,andthen define the journey to where they want to be.Three roles to drive enterprise evolutionWe believe that this opport

104、unity of business leadership through technology requires todays executives(the CXOand the CIO)to play three key roles:as technology strategists,as ROI hawks,and as change agents.The CXO-CIO roleWhat your peers say1.Technology strategist“When you look at technology,we are less than 5%of the way”VP,In

105、ternet Technology,IBM“Information architecture is as flexible as a building”Director,Center of Business Innovation“Every person gets the technology they deserve”Toffler Associates,Consultant2.ROI hawk“The challenge remains how to make money on the Internet”CEO,Genuity“Lots of money on technology ini

106、tiatives,but ROII(return on Internet investment)isnt necessarilythere”CTO,Merrill Lynch3.Change agent“The issue isnt technology.The issue is whether an organization can apply new technology”CMO,SAS Institute“seriously underestimate the discipline to absorb change”CIO,CIGNASource:Fast Company,Infosys

107、 Team SynthesisThe issue often is that the CXO-CIO has one or two of the attributes rarely a judicious balance of the three.Whichis why,more than ever before,technology will be driven by the CEOs.12This page is intentionally left blank.13Awards for excellence“I just try to be the best I can be and h

108、ope that is the best ever.”Tiger WoodsThe Awards for excellence,at Infosys,represent an important step in our excitingjourney to excellence.We firmly believe that the recognition of excellence is asimportant as the personal drive of every individual to excel.As we continue to growfrom strength to st

109、rength as an organization,we constantly try to do better than ourbest to ensure that we continue to have an enthusiastic workforce that believes inthe organization,its value system and philosophy,and in the aggressive targets itsets for itself.Infosys today is more than 10,000 people strong.The task

110、 of selecting a few highachievers from this veritable ocean of talent was indeed a challenging one.The oneswho have finally been chosen have demonstrated a commitment to surpassingcustomers expectations,and have set high standards in our business and transactions,thereby becoming an exemplar for all

111、.These individuals have shown an unstintingability to deal with myriad and complex situations,and have adapted to these skillfully.We are proud to present this years award winners individuals who believe incompeting against themselves;individuals who strive towards self-improvement,towards being bet

112、ter than they were the day before.14Awards for excellence 2001-2002Account/Sales ManagementBBU Team NigeriaAjith Nair,Anand Sundararaman,Amit Dua,C.S Vinay,T.N.GopalSales Management TeamMadhav Mohan,Ayan Chatterjee*ToshibaIndranil Mukherjee,V.Sriram,Sailaja Chintalagiri,R.Sridhar,Chandra Shekar Kaka

113、l*External Customer DelightBoeing CRDS ProjectRohit Kedia,Venkateswarlu Pallapothu,V.R.Renganathan,Madhu Janardan*NordstromR.Dinesh,Ganesh Gopalakrishnan,K.R.Nandakumar*,Pradeep Prabhu*,Dinesh Bajaj*First Prize Awards were presented by Mr.N.R.Narayana Murthy,Chairman and Chief Mentor*not present at

114、the function15Awards for excellence 2001-2002Second PrizeBrand ManagementAditi MadhokS.SukumarInnovationAjay DubeyAnand GovindarajanHarish KashyapG.LakshmananV.RajaSandeep GuptaSanjay Shankar DeshpandeA.V.S.B.ShankarDC ManagementMangalore DCDheeraj HejmadiGopikrishnan KonnanathKeerthinidhi HerleR.Mo

115、sesrajNarendran KoduvattatRichard LoboS.A.Samuel RajShaji MathewSudhir AlbuquerquePune DCS.BabujiChandrakanth DesaiChandraketu JhaM.K.ManjulaPriti Jay RaoShailendra JhaShalini DongreSnigdha MitraUday BhaskarwarThird PrizeValue ChampionsH.SudheerProgram ManagementIKON RPT TeamD.A.BalarajK.P.ManuRavi

116、Kiran TaireRavishankar KayyarK.SrikanthSrinivasa N.KaranthUmesh B.PrabhuNML TeamBasab PradhanBhaskar ChicknanjundappaBibhu R.PattanayakDevasenapathy Murugappan MuthuSamson DavidV.ShubhaInfrastructureFerrari CFPMV.V.AnanthalakshmiHema RavichandarKaushik RayU.B.Pravin RaoRaj Kumar BansalRajiv RaghuS.R

117、ameshSamit DebShivaprasad Gopalrao KuskurMangalore TeamAshok G.GadaviDinesh KumarGanesh H.ShenoyGeetha CoelhoLeo Daniel DSilvaP.Padmanabha BhatU.Ramadas KamathSankaran VelunathanJ.ShashikalaSystems and ProcessesIPM TeamGaurav JhambJyoti M.BhatNagajyothi BathulaS.NirmalaG.RameshRishikesh V.RaoRupa G.

118、KamatK.N.V.S.K.SubrahmanyamVishwajit SinghPayana TeamBadrinarayan SahooDeepak BhallaPrakash Nagaraj DevadigaB.RajeshSarala PamidiShailesh Kumar AgrawalR.Venkat RaghavanVikas Ravindra RevankarS.ViswanathanInternal Customer DelightPreeti ChandrashekharRangan VaradanSudhir G.PaiPU ManagementBanking Bus

119、iness UnitDeepak N.HoshingGirish G.VaidyaHaragopal MangipudiMerwin FernandesSpecial PrizeR.N.NagarajV.SrinivasanD.Thirumaleshwara BhatT.S.VenkataramananSocial ConsciousnessB.M.RaoM.S.S.R.R.KumarT.V.Mohandas PaiPrem Shyam MirchandaniU.Ramadas Kamath3COMAshish RayRajesh K.MurthySreenath MurthySrinivas

120、 V.BNSF TeamAlexandre Elvis RodriguesDebashish BanerjeeM.R.KishoreN.Shiv ShankarVijay N.KrishnaToshiba AmericaAnand SwaminathanEric Seubert16Board of directorsN.R.Narayana MurthyNandan M.NilekaniS.GopalakrishnanDeepak M.SatwalekarProf.Marti G.SubrahmanyamPhilip YeoProf.Jitendra Vir SinghDr.Omkar Gos

121、wamiSen.Larry PresslerRama BijapurkarClaude SmadjaK.DineshS.D.ShibulalT.V.Mohandas PaiPhaneesh MurthySrinath BatniCommittees of the boardAudit committeeDeepak M.Satwalekar,ChairmanRama BijapurkarDr.Omkar GoswamiSen.Larry PresslerClaude SmadjaProf.Marti G.SubrahmanyamCompensation committeeProf.Marti

122、G.Subrahmanyam,ChairmanDr.Omkar GoswamiDeepak M.SatwalekarProf.Jitendra Vir SinghPhilip YeoNominations committeeClaude Smadja,ChairmanSen.Larry PresslerProf.Jitendra Vir SinghPhilip YeoInvestors grievance committeePhilip Yeo,ChairmanRama BijapurkarK.DineshNandan M.NilekaniS.D.ShibulalNandita Mohan G

123、urjarAssociate Vice President Learning and Development HRDEshan JoshiManager Compensation and Benefits HRDChandrasekhar KakalAssociate Vice President Head Hyderabad Development CenterNarendran KoduvattatSenior Project Manager Head Mangalore Development CenterCol.C.V.KrishnaAssociate Vice President I

124、nfrastructure and SecurityBikramjit MaitraAssociate Vice President Head Bhubaneswar Development CenterN.Shiv ShankarAssociate Vice President Head Chennai Development CenterM.SridharManager Communication Design GroupS.SukumarManager Corporate PlanningPriti Jay RaoAssociate Vice President Head Pune De

125、velopment CenterC.RaviAssociate Vice President Head Mysore Development CenterJagdish VasishthaProject Manager Head Mohali Development CenterPadmanabhan VenkataramanAssociate Vice President Quality ImplementationT.S.VenkataramananAssociate Vice President Banking Business UnitVoice of the YouthAyan Ch

126、atterjeeDinesh GanesanNitin GuptaEsteban HerreraVaishali V.KhandekarV.B.MadhavanM.K.ManjulaB.Madhu Krishna RaoKarthikeya N.SarmaManagement council inviteesInfosys FoundationTrusteesSudha Murty,ChairpersonSrinath BatniSudha Gopalakrishnan17Letter to the shareholderDear shareholder,We are pleased to p

127、resent your companys Annual Report and financial statementsfor fiscal year 2002.It has been one of the most challenging years for the IT industry all over the world,and your company has not been an exception.Global slowdown,slump in the USeconomy and falling technology spends,accentuated by the trag

128、edy ofSeptember 11,have all taken their toll on the industry.Long accustomed to highdouble-digit,even triple-digit growth,IT services providers have had to live witha much more modest and intensely more competitive reality.In April 2001,after closely examining all relevant economic and business indi

129、catorsof the US,the European Union and Japan,your company estimated a revenuegrowth of 30%for fiscal year 2002.At that time,many felt that we were beingunduly pessimistic.To them,the world economy was having a minor hiccup nothing that could seriously affect the high double-digit growth of Indias IT

130、 sector.To achieve the revenue target set out in April 2001 despite the effects of September11 has been satisfying.It reaffirms the resilience of your companysGlobal Delivery Model,the commitment and dedication of Infoscions,and the enduring nature of the value-based relationships that your companyh

131、as developed and sustained with its various business partners.Here are some of the key financial results.Under Indian GAAP,your companys revenues grew by 37.0%during fiscal year 2002 fromRs.1,900.6 crore in fiscal 2001 to Rs.2,603.6 crore in fiscal 2002.Profit after tax(PAT)from ordinary activities

132、increased by 29.6%,fromRs.623.3 crore to Rs.808.0 crore.Notwithstanding intense pricing pressures,Infosys succeeded in maintaining superior profit margins.For fiscalyear 2002,profit before interest,depreciation and taxes(PBIDT)as a share of total revenues stood at 39.9%;and PAT from ordinary activit

133、ies asa share of total revenues was 31.0%.Basic earnings per share from ordinary activities increased by 29.6%to Rs.122.1.Under US GAAP,revenues increased from$413.9 million in fiscal year 2001 to$545.1 million in fiscal year 2002 a growth of 31.7%.Operatingincome increased by 29.8%,from$137.5 milli

134、on in fiscal 2001 to$178.5 million in fiscal 2002.Net income grew by 24.6%,from$131.9 millionin fiscal 2001 to$164.5 million in fiscal 2002.Operating income as a share of revenues was 32.8%,while net income as a share of revenue stoodat 30.2%.Basic earnings per share increased by 24.9%to$2.51.Your c

135、ompany succeeded in meeting its financial targets in an extremely adverse environment.It was done by driving volumes,adding several newclients,having a repeat business rate as high as 87.6%,and by tight cost control in virtually all areas.Despite 37.0%higher revenue under IndianGAAP,your company cut

136、 costs amounting to 2.4%of its income.Indeed,the cost reductions could have been as high as 3.5%had it not been for theunanticipated increase in personnel cost in the US due to significantly higher floor pay imposed upon H1-B visa holders.To us,the more important story is how your company treated th

137、e adverse global circumstances of fiscal year 2002 as an opportunity to restructureand move towards becoming a finely aligned,integrated,end-to-end services provider in all key areas of the IT space.This is what we want toshare with you in the rest of this letter.Clients have always been central to

138、your company.Even so,a deeper understanding of the heterogeneous needs of various clients is more importantthan ever before.First,competition is much more intense,and there are enough global IT services providers to nibble at anybodys market share.Second,the days of“me-too”IT spends are over.The eco

139、nomic downturn has accelerated a process of change where corporate clients are very carefulabout their IT spending.They expect to rapidly maximize returns on such expenditure,and seek strategic initiatives that enhance infrastructureefficiencies,provide quick and demonstrable cost savings,while impr

140、oving their customer satisfaction.Third,the focus is rapidly shifting towardsworking with fewer,more reliable vendors,who have the capability to deliver,implement and maintain a full range of IT services.In this scenario,the future growth of your company depends on being a best-in-class,end-to-end s

141、olutions provider,and your company hasalready begun work towards achieving that goal.There have been several new services initiatives.For instance,an investment up to$5 million hasbeen approved for your companys foray into Business Process Management(BPM).A separate company is being formed.It will b

142、e headquarteredin Bangalore,and will leverage the obvious cost advantages of operating in India.The initial BPM focus will be in the areas of transactionprocessing and accounting services.One of the key target verticals will be financial services.Another new focus area is IT outsourcing.Your company

143、 has taken over the IT departments of two corporate clients a leading internationalnetworking equipment manufacturer and a global financial services major.In both instances,your company provides 24 hours a day,7 days aweek(24x7)support to mission-critical applications.Your company has also developed

144、 and deployed new e-business solutions for one suchclient.In addition,your company has also started marketing its systems integration services.However,your company has to pass many moremilestones in its quest for being a complete end-to-end services provider.As a part of reaching out to and strength

145、ening relationships with customers,your company now has over 70 account managers who have clearlydefined tasks of servicing the needs of each and every client.In fiscal year 2002,there were 143 Infoscions directly and exclusively involved insales and marketing.S.GopalakrishnanNandan M.NilekaniChief

146、Operationg OfficerChief Executive Officer,Presidentand Deputy Managing Directorand Managing Director18In a very arduous year,your company succeeded in attracting the business of 116 new clients,of which 62 were added in the difficult period ofSeptember 2001 to March 2002.Your company now has 25 five

147、-million-dollar clients(versus 19 in fiscal year 2001),and 16 ten-million-dollarclients(versus 11 in fiscal year 2001).Your companys Banking Business Unit(BBU)added 11 new customers during the year for its FINACLE,BankAway,and PayAwayapplications four in India and seven overseas.In the process,BBUs

148、revenues grew by over 100.0%during fiscal year 2002,and crossed the Rs.100.0 crore threshold.Steps have been taken to strengthen FINACLE the core-banking product by acquiring new functionalities andmodules.These are to be integrated with the core product,and will not only enrich FINACLE but also pro

149、vide crucial time-to-market advantagesover competitors.Your company has also expanded its presence in pharmaceuticals and medical care.Your company is helping an international pharmaceuticalmajor to design and develop a mail-order pharmacy and a durable medical equipment claims process.Another succe

150、ss has been the business ofa pharmacy benefit company,for whom Infosys is recommending the re-engineering of multiple applications.A major company in the medicalsector has retained your company to assess business and IT processes,and to create its IT blueprint for the next three to five years.With t

151、he deregulation of utilities,companies urgently need to develop and implement scalable and risk-free technology platforms.Your company hasbeen commissioned by CustomerWorks,a joint venture between two of Canadas largest utility organizations,to execute a high-level,customer-focusedrisk assessment pr

152、ogram.Servicing customers requires upgradation of people and processes.Throughout fiscal year 2002,these two areas have occupied a large portion ofsenior managements time.The HR challenges are to recruit,retain and enable the best and the brightest;create a readily deployable global talent pool;sust

153、ain high levels ofemployee motivation;enable competency-based roles within the company;and hard-wire the DNA of a high performance work ethic throughoutthe organization.Although there is much more to be done,your company has begun to achieve these objectives.Here are some facts:?Notwithstanding the

154、difficulties of fiscal year 2002,your company hired 1,548 people.Net addition for the year was 907,and the period-endheadcount was 10,738.?Your company continues to have one of the lowest attrition rates among comparable IT services providers in India.?Lateral hiring and local recruitment is on the

155、rise.Today,there are Infoscions from 29 nationalities developments that help your company tonot only concentrate on domain expertise,but also to have the cultural wherewithal to understand the needs of international clients.?The organization is being restructured into a role-based organization.All p

156、ractices and units are being aligned to competency-based streams.?Your company has some of the most demanding in-house training programs in the IT world 14.5 weeks of an integrated training programfor new recruits,plus several continuing executive education programs in technical,managerial and proce

157、ss related areas,which averageabout ten days per person,per year.In addition,there are intensive programs at the new Infosys Leadership Institute,Mysore,which meritsa separate paragraph.?Given the challenging times,it is critical to sustain and sharpen employee motivation.There is a new emphasis on

158、continuous communicationacross all groups and all employee levels;on institutionalizing knowledge management and dissemination;and on active participation inemployee satisfaction programs,whose results are better monitored and much more widely shared.Moreover,there has been a major shifttowards tran

159、sparent and well-designed objective-driven appraisals and performance-linked pay.The culture of a high performance work ethicis built around this Integrated Performance Management System.?All these initiatives are solidly integrated in your companys IT systems and processes.Your company has develope

160、d several internal systems,including the balanced scorecard and 360 appraisals to continuously monitor employee aspirations and performance.In addition,yourcompany has adopted the Malcolm Baldrige framework and the Six Sigma initiative to align with businesses and streamline its processes toaddress

161、the challenges of growth and scalability.These programs are paying off.This is reinforced through both internal and external benchmarks.In the Internal Employee Satisfaction Survey,scores indicate that employee satisfaction has gone up by 12.0%over last year.In 2002,for the second year in succession

162、,your company wasdeclared the best employer in India in the Business Today-Hewitt survey.Your company was also declared by Dataquest-NFO-MBL India survey asthe best employer in the Indian software industry,as well as ITs best employer in another Dataquest-IDC survey.Leadership development is critica

163、l to a companys growth.The Infosys Leadership Institute(ILI)at Mysore commenced its programs during theyear.Today,the ILI campus has a built-up area of 162,000 square feet.In a short span,ILI completed a round of“Leaders Teach Series”consistingof 11 workshops;executed 12 internal consulting engageme

164、nts;rolled out counseling process to the high potential employees of your company;and designed and launched a pilot program on Mentoring.Further,the director of ILI has conducted 5 external programs.Going forward,ILI will train 220 high potential employees for a duration of five days each;conduct 35

165、 leadership development programs of 2.5days each;provide counseling sessions to each high potential employee;execute consulting projects to internal and external customers;andpublish papers and conduct external seminars.That brings us to finance.Your companys policy is to maintain sufficient cash in

166、 the balance sheet to meet the following objectives:?To fund the ongoing capex requirements to meet its growth objectives;?To fund the operational expenses and other strategic initiatives for the next one year;and?To maintain business continuance in case of exigencies.19This year,too,your company re

167、ceived recognition from several organizations.The details are available in the Directors report.As in the last year,the senior management of your company conducted relevant studies to understand IT market trends for fiscal year 2003.Despite early signs of a slow global economic revival,your company

168、believes that conditions will remain tough for all.Your company has,therefore,projected 17.0%to 20.0%revenue growth for fiscal year 2003.This estimate is based on our current understanding of the marketplace.Naturally,we hope that conditions will improve.We will proactively update our investors in t

169、he event of any material development.As a global corporation,your company focuses on succession planning and management continuity.In keeping with this,Mr.N.R.Narayana Murthyassumed the role of Chairman and Chief Mentor.In his new role,he mentors your companys core management team in transforming th

170、e companyinto a world-class,next-generation organization that provides technology-leveraged business solutions to corporations across the globe.He is alsoworking with leading thought-leaders all over the world to enhance the leadership position of Infosys.As already announced,Mr.Nandan M.Nilekani do

171、nned the mantle of Chief Executive Officer,while Mr.S.Gopalakrishnan has taken over thefunction of Chief Operating Officer.During the year,Mr.Ramesh Vangal retired as director.Your company is grateful to Mr.Vangal for his invaluable contributions during his tenure,and wishes him the very best in his

172、 future endeavors.Mr.Claude Smadja,Principal Advisor to the World Economic Forum and Director of Smadja&Associates:Strategic Advisory,was inducted as an additional director.Your companys vision is to be a globally respected corporation that provides best-of-breed business solutions,leveraging techno

173、logy,delivered bybest-in-class people.With your support,and the dedication of all fellow Infoscions,we will achieve that goal.BangaloreS.GopalakrishnanNandan M.NilekaniApril 10,2002Chief Operating OfficerChief Executive Officer,Presidentand Deputy Managing Directorand Managing DirectorForward-lookin

174、g statements in this letter should be read in conjunction with the following cautionary statements.Certain expectations and projections regarding futureperformance of the company referenced in this Annual Report are forward-looking statements.These expectations and projections are based on currently

175、 availablecompetitive,financial,and economic data along with the companys operating plans and are subject to certain future events and uncertainties,that could cause actualresults to differ materially from those that may be indicated by such statements.20Directors reportTo the members,Your directors

176、 are pleased to present their report on the business and operations of your company for the year ended March 31,2002.Financial resultsin Rs.crore except per share data*Year ended March 3120022001Income2,603.591,900.56Software development expenses1,224.82870.83Gross profit1,378.771,029.73Selling and

177、marketing expenses129.7992.07General and administration expenses211.35172.82Operating profit(PBIDT)1,037.63764.84InterestDepreciation160.65112.89Operating profit after interest and depreciation876.98651.95Other income66.4159.37Provision for investment15.29Profit before tax and extraordinary item943.

178、39696.03Provision for tax135.4372.71Profit after tax before extraordinary item807.96623.32Extraordinary itemTransfer of intellectual property right(net of tax)5.49Profit after tax and extraordinary item807.96628.81AppropriationsInterim dividend49.6316.53Final dividend Proposed(Subject to deduction o

179、f tax,if any)82.7349.62Total dividend132.3666.15Dividend tax5.068.70Transferred to general reserve670.54553.96Earnings per share(equity shares,par value Rs.5 each)Basic122.1295.06Diluted121.3794.76*1 crore equals 10 million.1 lakh equals 100,000.Results of operations?Total revenues grew to Rs.2,603.

180、59 crore from Rs.1,900.56 crore,a growth rate of 36.99%.?Operating profit grew to Rs.1,037.63 crore(39.85%of total revenues)from Rs.764.84 crore(40.24%of total revenues),a growth rateof 35.66%.?Profit after tax,from ordinary activities,increased to Rs.807.96 crore(31.03%of total revenue)from Rs.623.

181、32 crore(32.80%of totalrevenue),an increase of 29.62%.DividendAn interim dividend of Rs.7.50 per share(150%on par value of Rs.5)was paid in November 2001.Your directors now recommend a finaldividend of Rs.12.50 per share(250%on par value of Rs.5)aggregating Rs.20.00 per share(400%on par value of Rs.

182、5),for the current year.The total amount of dividend is Rs.132.36 crore,as against Rs.66.15 crore for the previous year.Dividend(including dividend tax),as apercentage of profit after tax from ordinary activities,is 17.01%,as compared to 12.01%in the previous year.Until March 31,2002,the receipt of

183、dividend was tax-free in the hands of the shareholders,under the Indian Income Tax Act,1961.EffectiveApril 1,2002,the dividend income is proposed to be taxed in the hands of the shareholders and,accordingly,is subject to deduction of tax,if any.The tax on distributed profits,paid by the company on t

184、he interim dividend was Rs.5.06 crore.As per the proposed tax regulations,there is nodistribution tax on the profits distributed after March 31,2002.Increase in share capitalYour company issued 28,013 shares on the exercise of stock options,issued under the 1998 and 1999 employee stock option plans.

185、Due to this,the outstanding issued,subscribed and paid-up equity share capital increased from 6,61,58,117 shares,during the previous year,to 6,61,86,130shares in the year under review.BusinessThe year had been one of the most challenging years for your company.The impact of the global slowdown coupl

186、ed with the tragedy of September11 posed tremendous challenges.Despite this,your company performed well and showed all-round growth.Under Indian GAAP,revenues grewby 37%over fiscal year 2001 while net profits from ordinary activities witnessed an increase of 30%.In April 2001,your company estimated

187、a21revenue growth of 30%for fiscal year 2002 and has achieved that despite all odds including the tragedy of September 11.Your companycontinues to focus on building long-term relationships with Global 2000 corporations worldwide.This is reflected in its repeat business rate of88%.Your company signed

188、 up 116 new clients,a substantial number of whom are large corporations,and had a total client base of 293 at the endof the year.Further,your company had 83 million-dollar clients(80 in the previous year),25 five-million-dollar clients(19 in the previous year)and 16 ten-million-dollar clients(11 in

189、the previous year).During the previous year,due to the changes in the capital markets and general economic conditions,your company expressed its intention toreduce its exposure to venture-funded companies.We are pleased to announce that your company has been highly successful in transitioning itsrev

190、enues from venture-funded companies to Fortune 500 companies and other well established corporations.The year also saw your company scaling up on the human resources and infrastructure front.Net of separations,907 employees were added,taking the total strength to 10,738.Your company added another 9.

191、97 lakh square feet of physical infrastructure space,taking the total spaceavailable to 26.63 lakh square feet.The number of overseas marketing offices as on March 31,2002 was 24,compared to 21 as on March 31,2001.Your companys software export revenues aggregated Rs.2,552.47 crore,up 36.20%from Rs.1

192、,874.02 crore the previous year.During the year,71.2%of the revenues came from North America,19.5%from Europe,and 7.3%from the rest of the world.The share of the fixed-pricecomponent of the business was 31.6%,as compared to 28.2%during the previous year.Revenue productivity,in dollar terms,declined

193、by 4.4%.Your company remains optimistic about the long-term opportunities while at the same time meeting the short-term challenges.Your companyresponded to the challenges by enhancing customer focus and by building an efficient sales engine.Your company is closely monitoring themarket situation,and

194、believes that its unique business model and prudent risk-management practices,coupled with a strong customer base anddeep client relationships,gives it a sustainable long-term competitive advantage.Your company will aggressively pursue new opportunities,andwill ensure adequate internal preparedness

195、to take maximum advantage of such opportunities.Banking Business Unit(BBU)The Banking Business Unit has shown remarkable growth during this year.Your companys product FINACLE,is an integrated core bankingsolution that is centralized,multi-currency and multi-language-enabled,functionally-rich,and add

196、resses both retail and corporate bankingrequirements.During the year,your company took several steps to strengthen FINACLE by adding new functionalities and modules.Targeted at the bankingindustry,FINACLE CRM is a new product offering from your company.It covers areas such as Sales,Marketing,Support

197、,360 degree View,Loanorigination,and Analytics.Banks can effectively deploy FINACLE CRM to gain competitive advantage by proactively addressing customersneeds and expectations.FINACLE CRM integrates banks multiple channels such as call centers,branches,fax and web while providingcomprehensive access

198、 to various product processing systems at the back end,thus,greatly enhancing the banks ability to maintain relationshipsand improve profitability with customers.FINACLE has a market share of over 60%among the Indian banks that have adopted technology modernization measures 4 out of 6 oldgeneration

199、private sector banks,5 out of the 8 new generation private sector banks and 1 out of 2 public sector banks in India are now poweredby FINACLE.The Banking Business Unit has consolidated its position in the African market,and has also expanded into the Middle East.During the year,itacquired 11 new cli

200、ents,4 in India and 7 overseas,for FINACLE,BankAway,and PayAway applications.The Banking Business Unitundertook engagements for the Kenya Commercial Bank,Kenya the biggest bank in East Africa,and the First Bank of Nigeria,Nigeria thebiggest bank in West Africa,during the year.FINACLE was ranked amon

201、g the top three best selling retail banking systems in the world by IBSpublishing,UK for the year 2000-2001.Development centers in IndiaYour company incurred capital expenditure aggregating Rs.322.74 crore as compared to Rs.463.35 crore during the previous year.Of the totalcapital expenditure,Rs.67.

202、40 crore was spent on technological infrastructure as compared to Rs.113.84 crore in the previous year.In Bangalore,the Management Development Center was completed with a built-up area of 75,500 square feet.An additional 60,000 square feetof software development space to accommodate 600 professional

203、s and one more software development block of 93,827 square feet with acapacity of 577 seats were completed.Additionally,civil works were completed for two more software development blocks with a built-up area of2,06,000 square feet.The existing capacity at Bangalore comprises 11,16,000 square feet c

204、apable of accommodating 5,050 professionals.Phase II of the Pune campus is progressing as per schedule.One software development block of 1,14,440 square feet to accommodate 800professionals and a dining block of 17,000 square feet were completed.One more software development block of 800 seats capac

205、ity was completedand the employee care center is under completion.Civil works were completed for the customer care center.Currently,the campus has a built-uparea of 3,33,500 square feet with a capacity of 2,076 seats.In Bhubaneswar,a second software development block of 75,000 square feet to accommo

206、date 600 professionals and a food court of 28,000square feet were completed.Currently,the campus has a built-up area of 1,89,000 square feet with a capacity of 1,200 seats.In Chennai phase I,one more software development block of 75,000 square feet capable of accommodating 600 professionals and a fo

207、od court of30,000 square feet were completed.Construction of phase II of the campus is on schedule.In phase II,one software development block of 600seats capacity was completed.Civil works were completed for one more software development block.Currently,the campus has a built-up area of1,98,000 squa

208、re feet with a capacity of 1,300 seats.In Hyderabad,one software development block of 1,23,000 square feet with a seating capacity of 325 professionals was completed.The remaining355 seats in this block will be completed as and when required.Construction of the food court is proceeding as per schedu

209、le.Civil works werecompleted for one more software development block.Currently,the campus has a built-up area of 1,35,800 square feet with a capacity of 325seats.22In Mysore,one software development block of 1,06,000 square feet with a seating capacity of 200 professionals was completed.The remainin

210、g400 seats in this block will be completed as and when required.The Infosys Leadership Institute(“ILI”)with a built-up area of 1,62,000 squarefeet and the hostel facilities with a built-up area of 91,750 square feet were also completed.The food court is nearing completion.Currently,thecampus has a b

211、uilt-up area of 3,79,000 square feet.As of March 31,2002,the company had 26,69,600 square feet of space capable of accommodating 12,050 professionals and 9,31,000 square feetunder completion.Overseas branchesTo accelerate the sales effort in overseas markets,sales offices were opened in the Netherla

212、nds,Singapore and Switzerland.During the comingyear,additional sales offices are expected to be opened in North America,Europe and Asia.Expansion of the overseas sales network will help yourcompany access new markets and broaden its client base.As at the year-end,your company had 24 marketing office

213、s overseas.Yantra CorporationYantra Corporation provides e-business software solutions for managing supply chain transactions across the extraprise.Yantra has built a high-quality management team and has taken several initiatives to implement its growth objectives.During the year,your company swappe

214、d 55,00,000 common stock in Yantra Corporation,USA(“Yantra”)for a fully paid warrant to purchase55,00,000 common stock.As a result of this,your company holds around 44%of the outstanding common stock of Yantra.Accordingly,Yantrais no longer a subsidiary of the company as per the Companies Act,1956 a

215、s at March 31,2002.Your company holds around 16%of Yantra,ona fully diluted basis.Strategic investmentsYour company had made selective investments in leading-edge companies and select venture capital funds that have the potential to yield substantialbusiness benefits.Benefits from these investments

216、are primarily in the form of revenue and net income enhancements,through technologypartnerships and access to the latest technological developments.Your company has leveraged the expertise derived from its investee companiesto deliver value to large clients across the globe.During the year,your comp

217、any invested Rs.10.32 crore in Workadia Inc.USA(“Workadia”)purchasing 22,00,000 fully paid Series“B”convertiblepreferred stock,par value of US$0.0002,at US$1.00 each(adjusted for stock splits).Workadia will provide companies with comprehensive,customizable business intranets through browser accessed

218、 hosted portals,and also offer consulting services to help customers select and deploytheir intranet applications,content and services.Your company is foraying into Business Process Management(“BPM”)and the board of directors of your company has approved an investment ofup to US$5 million for this i

219、nitiative.The initial focus of BPM services will be in the areas of transaction processing and accounting services andthese services will be offered in multiple forms as business process re-engineering,shared services platform and business intelligence services.Itwill leverage the obvious cost advan

220、tages of doing the work from India.Financial services will be one of the key target verticals.The frameworksdeveloped for the BPM offering is based on your companys InFlux methodology.These frameworks will enable client processes to be transitionedand executed smoothly.Human resource managementThe k

221、ey resource for your company is its employees.Your company has been able to create a favorable work environment that encouragesinnovation and meritocracy.Your company has put in place a scalable recruitment and human resource management process,enabling it to attractand retain high-caliber employees

222、.Your company added 907 employees,net of separations,taking the total strength to 10,738 up from 9,831at the end of the previous year.Entry-level engineers are put through intensive technical training and are also exposed to cross-functional training that helps hone their soft skills.Further,all emp

223、loyees are eligible for your companys stock option plan.Your companys attrition rate,at 6.2%for the year(11.2%for theprevious year),is testimony to its ability to attract and retain high-quality talent.In order to ensure a safe and congenial workplace,your company has formulated and implemented a po

224、licy against sexual harassment.Processimprovements have also been made in the areas of recruitment,training and visa processing.The efforts of your company in the area of employee management and HR practices have been widely acclaimed in various fora.Your companywas adjudged the Best Indian software

225、 company in the Softwares Best Employers study,a Dataquest survey,in May 2001.It then emerged firstamong Indian ITs Best Employers,a Dataquest IDC India survey,in August 2001.Further,your company went on to become the best employerin India for the second time in a row,in the Best Employers in India

226、study,a Business Today Hewitt listing of the 25 most desirable companies towork for in India.QualityYour company firmly believes that“Pursuit of Excellence”is one of the most critical components for competitive success in the global market.Yourcompany has achieved high maturity through rigorous adhe

227、rence to highly evolved processes,which have been systematically benchmarkedagainst world-class operating models,viz.ISO 9001-TickIT,SEI-CMM and Baldrige.Your company is rated at Level 5 of the Capability MaturityModel(CMM),which is the world-class benchmark in software process management.To address

228、 the challenges of the future and to ensure performance improvement in an integrated manner,your company has launched the InfosysExcellence Initiative(IEI),which is a single umbrella for all quality initiatives within the organization.This initiative spans various functions in theorganization,namely

229、 core delivery processes,functional and cross-functional processes,and organizational management processes.It envisagesleveraging CMM Level 5 for delivery processes,the Malcolm Baldrige framework for organizational management processes and Six Sigma CrossFunctional Process Mapping(CFPM)techniques fo

230、r improving cross-functional processes.23Your companys best practices and processes in the area of project management are showcased in the book“Software Project Management inPractice”by Dr.Pankaj Jalote(Addison Wesley,2002)published under the SEI series.Your company has helped many of its clients im

231、prove their processes and systems by providing high-end software process consulting services,which is a testimony to its process leadership.Infosys Leadership InstituteLocated on 217 acres of land in Mysore,India,and operationalized during the year,the Infosys Leadership Institutes(ILI)mandate is to

232、 enableand empower the present and future leaders of your company to achieve its vision.The ILI campus includes state-of-the-art leadership development,training,and learning facilities,including comfortable hostels for the participant Infoscions.Since its inception,ILI has designed and facilitated a

233、series of highly successful,innovative,and dynamic leadership workshops led by your companys board members under the“Leader TeachSeries.”Other high-value added services taken up by ILI include counseling high-potential Infoscions in their leadership journey and internalconsultancy assignments includ

234、ing facilitating strategy-planning and team building sessions.InStep global internship programInStep,your companys Global Internship Program,plays an important role in increasing the brand awareness of your company internationally.Byattracting students from the top academic institutions around the w

235、orld,InStep has not only built brand equity for your company,but is also keyto its International Recruitment Initiative.Through the internship program,your company selects students,for summer projects,from the leading educational institutions across the globeand places them in live business and tech

236、nical projects in your companys offices worldwide.Since its inception,the program has recruited interns from diverse milieu.Interns range from IT students from Ecole Des Mines De Nantes tobusiness students from Stanford.This year,your company has held InStep Information Sessions in the US,UK,Japan,F

237、rance,India and Canada,and has received over 1,000 applications for just 20 internship positions.The new information infrastructureYour company firmly believes that its internal IT initiatives are key drivers of scalable and sustained corporate excellence.The key,ongoing focus last year has been to?

238、drive information availability to a global work force,?integrate cross-functional processes,?enable scalable,sustained excellence in execution,?enhance employee and process productivity,and?further strengthen our client partnerships.Towards this,your companys Information Systems(IS)team?deployed an

239、exhaustive home grown suite of solutions for Integrated Project Management(IPM)to scale and sustain excellence inexecution in its core delivery processes;?deployed an extranet for connecting our worldwide workforce,enabling them with a rich set of online corporate resources on arobust,secure and sca

240、lable delivery channel;?custom-built a CRM solution integrating key processes across the service chain and across the customer life cycle.Built leveraging state-of-the-art technologies and our extranet,this program is currently under deployment throughout our customer touch-points worldwide;?is curr

241、ently focusing on a future ready,globally scalable.NET infrastructure that leverages investments made in its intranet backbone,secure extranet,SAP R/3 4.6 and state-of-the-art Storage Area Network to enhance global delivery and 24 x 7 operations;?has further enriched the large automation footprint w

242、ith a range of custom-built,web-enabled systems that address your companyschanging business needs;and?initiated a Balanced Score Card implementation to strategically align IS initiatives for maximizing contributions to your companys globalcompetencies and strategic business objectives.Currently in a

243、n advanced state of implementation,key learnings from this exercise havealready been used successfully to enhance our engagement opportunities with some of our customers.Additional information to shareholdersIn earlier years,your company provided additional information in the form of intangible asse

244、ts scoresheet,human resources accounting,value-added statement,brand valuation,economic value-added statement,current-cost-adjusted financial statements,and financial statements in substantialcompliance with GAAP of six countries,in addition to the US and India.This information is provided in this y

245、ears Annual Report also.Corporate governanceThe current economic downturn,the unprecedented events of September 11,the Enron issue and recent business failures have combined tocreate a very challenging financial reporting environment.All these have resulted in a larger focus on corporate governance

246、issues by companies.Your company continues to be a pioneer in benchmarking its corporate governance policies with the best in the world,and its efforts are widelyrecognized by investors in India and abroad.Your company has complied with all the recommendations of the Kumar Mangalam Birla Committee o

247、n Corporate Governance constituted by theSecurities and Exchange Board of India(SEBI).For fiscal 2002,the compliance report is provided in the Corporate governance report in this AnnualReport.The auditors certificate on compliance with the mandatory recommendations of the committee is annexed to thi

248、s report.In addition,your directors have documented your companys internal policies on corporate governance.In line with the committeesrecommendations,the managements discussion and analysis of the financial position of the company is provided in this Annual Report and isincorporated here by referen

249、ce.Your company has also continued its practice of providing a compliance report on various corporate governance recommendations in vogue in sixcountries,in their national languages,for the benefit of our shareholders in those countries.24Responsibility statement of the board of directorsThe directo

250、rs responsibility statement setting out the compliance with the accounting and financial reporting requirements specified underSection 217(2AA)of the Companies(Amendment)Act,2000,in respect of the financial statements,is annexed to this report.Employee Stock Option Plan(ESOP)Your company has introdu

251、ced various stock option plans for its employees.Details of these,including grants to senior management,are givenbelow.Senior management includes directors of your company and members of its management council.1994 Stock Offer Plan(the 1994 plan)The 1994 plan came to an end in fiscal 2000;no further

252、 options will be issued under this plan.1998 Stock Option Plan(the 1998 plan)Your company has issued 9,08,500 ADS-linked stock options to 494 employees during the year under the 1998 plan.Details of such optionsgranted under the 1998 plan are given below.DescriptionDetails1.Total number of shares3.2

253、0 million ADS representing 1.60 million shares2.The pricing formulaNot less than 90%of the fair market value as on date of grant3.Ratio of ADS to equity sharesOne share represents two ADSs4.Options granted during the year9,08,500 options representing 4,54,250 equity shares5.Weighted average price pe

254、r option granted$49.50(Rs.2,415.10);100%of fair market value on theduring the yeardate of grant6.Options vested(as of March 31,2002)3,29,054 options representing 1,64,527 equity shares7.Options exercised during the year55,966 options representing 27,983 equity shares8.Money raised on exercise of opt

255、ions$9,51,422(Rs.4.59 crore)9.Options forfeited during the year1,55,546 options representing 77,773 equity shares10.Total number of options in force at the end of the year22,62,494 options representing 11,31,347 equity shares11.Grant to senior managementNo.of optionsNo.of optionsBrian Joseph King11,

256、500T.P.Prasad3,000Sanjay Joshi20,000Srinjay Sengupta4,000Subhash B.Dhar6,000V.Sriram3,000Ashok Vemuri10,000Jan DeSmet3,000Basab Pradhan4,000Total options granted to senior management during the year64,50012.Employees receiving 5%or more of the total number of options granted during the year:Nil1999

257、Stock Option Plan(the 1999 plan)Your company has issued 20,50,500 stock options to 6,063 employees and 8 independent directors?during the year under the 1999 plan.Thedetails of such options granted under the 1999 plan are given below.DescriptionDetails1.Total number of shares66,00,000 shares2.The pr

258、icing formulaAt the fair market value as on date of grant3.Options granted during the year20,50,500 options representing 20,50,500 equity shares4.Weighted average price per option grantedRs.3,094.41(100%of fair market value on the date of grant)during the year5.Options vested(as of March 31,2001):4,

259、48,530 options representing 4,48,530 equity shares6.Options exercised during the year30 options representing 30 equity shares7.Money raised on exercise of options:Rs.0.01 crore.8.Options forfeited during the year1,75,635 options representing 1,75,635 equity shares9.Total number of options in force a

260、t the end of the year46,68,815 options representing 46,68,815 equity shares25DescriptionDetails10.Grant to senior management and independent directorsNo.of optionsNo.of optionsDeepak M.Satwalekar7,000B.G.Srinivas12,000Ramesh Vangal*7,000Satyendra Kumar10,000Prof.Marti G.Subrahmanyam6,000Sanjay Puroh

261、it2,290Philip Yeo3,000G.K.Jayaram15,000Prof.Jitendra Vir Singh2,000V.Balakrishnan2,000Dr.Omkar Goswami2,000H.R.Binod1,500Sen.Larry Pressler2,000U.Ramadas Kamath1,500Rama Bijapurkar2,000Y.Parameswar2,000Ravindra Muthya Pranesha Rao3,000Girish G.Vaidya3,000Mohan Sekhar8,000 J.Sivashankar2,000Total opt

262、ions granted to senior management during the year93,290*Resigned during the year and hence forfeited the option.11.Employees receiving 5%or more of the total number of options granted during the year:NilLiquidityYour company continues to be debt-free,and maintains sufficient cash to meet its strateg

263、ic objectives.Your company believes in maintainingadequate liquidity in the balance sheet to maintain a fine balance between the need to provide adequate returns to the shareholders and the needto cover the financial and business risks that management foresees in the business.Liquidity enables your

264、company to reduce financial risk andallows a rapid shift in direction should the market so demand.During the current year,internal cash accruals have more than adequately coveredworking capital requirements,capital expenditure of Rs.322.74 crore and dividend payments,and have resulted in a surplus o

265、f Rs.449.22 crore.As on March 31,2002,your company had liquid assets of Rs.1,026.96 crore,as against Rs.577.74 crore at the previous year-end.These fundshave been invested both in rupee and dollar deposits with banks and highly rated financial institutions.Your company believes that the existingcash

266、 is adequate to meet its capital expenditure and working capital requirements for the near future.Research and education initiativesDuring the year,your company trained around 771 entrants as part of its entry-level training program.Further,continuing education has beenimparted,both in advanced tech

267、nologies as well as in managerial skills.The total training imparted by your company to its employees during theyear aggregated about 1,21,700 trainee person days.The Infosys Fellowship Program instituted by your company at 14 premier academic institutions in India to support research work leading t

268、o aPh.D.has been well received,and the number of fellowships instituted in the areas of information technology,management and law has beenincreased from 42 to 54.Your company spent around 0.57%of its revenue on R&D activities during the year.Your company is making steady progress in its journey towa

269、rds realizing its vision of leveraging the collective knowledge of the organization forcompetitive advantage and delivering better customer value.The program,inaugurated during August 2000,has reached a state of maturityevident in the active generation and widespread use of reusable knowledge,as tes

270、tified by the 200+(and increasing every month)knowledgeassets published per month in the companys intranet Knowledge Management(KM)portal,and the download of one knowledge asset for useevery 2 work-minutes.Your companys KM program has received widespread recognition amongst customers,practitioners,b

271、enchmarking agencies and academicians.Your company was one among the 37 finalists(the first Indian company to achieve this distinction)for the 2001 MAKE(Most Admired KnowledgeEnterprises)awards.Your companys KM Program is being used as case studies in two of Indias leading management schools.The pro

272、gram is also featured as a case ina chapter dedicated to it in a book titled“Knowledge and Business Process Management”being published by the Idea Group Publishing,Hershey,PA,USA.This is in addition to several publications in national and international journals,and presentations at various conferenc

273、es and KMcommunity forums.An important indicator of the recognition for the companys KM initiatives worldwide was an invited lecture from yourcompany at the event,“Knowledge Exchange Partnership for Global IT Organizations(KEP GIT)”,presented to a select group of CIOs of top-rungglobal IT companies.

274、Infosys FoundationYour company is committed to contribute to its social milieu and,in 1996,established Infosys Foundation as a not-for-profit trust to supportinitiatives that benefit society-at-large.The Foundation supports programs and organizations devoted to the cause of the destitute,rural poor,

275、thementally challenged,senior citizens and illiterates.It also helps preserve certain arts and cultural activities of India which are under threat of fadingout.Grants to the foundation during the year aggregated Rs.3.75 crore,?as compared to Rs.5.26 crore in the previous year.A summary of the work d

276、one by the Foundation appears in the Infosys Foundation section of this report.On your behalf,your directors expresstheir gratitude to the honorary trustees of the Foundation for sparing their valuable time and energy for the activities of the Foundation.Community servicesYour company,through its Co

277、mputersClassrooms initiative launched in January 1999,has donated 1,185 computers to 435 institutions acrossIndia.Your company has also applied to the relevant authorities for permission to donate an additional 382 computers to 149 institutes in the nearfuture.Microsoft continues to participate in t

278、his initiative by donating relevant software and we would like to place on record our appreciation forits continued support.26AwardsYour directors are happy to report some of the awards that your company received during the year.?First rank among 37 India-based companies in the Review 200 Asias Lead

279、ing Companies survey 2001 by the Far Eastern EconomicReview?First rank in the Best Employer Study by the Business Today-Hewitt study for the second year in succession?First rank in the Dataquest“Employee Perception Survey”carried out in the top 20 Indian software companies?First rank in the Business

280、 Worlds survey of“Indias Most Respected Company”?Corporate Citizenship Award by The Economics Times of India?The Institute of Company Secretaries of India National Award for Excellence in Corporate Governance by the Ministry of Law,Justice andCompany Affairs,Department of Company Affairs,Government

281、of India?Golden Peacock Award for Excellence in Corporate Governance in the Global Category by the World Council for Corporate Governance,London?No.1 rank in the CG watch 2002,the CLSA study on corporate governance practices in emerging markets?Award recognizing contributions in the social area usin

282、g IT by Computer World magazine?The Institute of Chartered Accountants of India award for best presented annual report in 2001 for the seventh successive year?Best regional software house award by Financial Technology Asia?Asiamoney award for best investor relations in India for 2001,best managed co

283、mpany in India for 2001 and best managed company of thedecade in India 1991-2001?Award for outstanding contribution towards the promotion of Indo-German Economic Relations-2001 by the Indo-German Chamber ofCommerceFixed depositsYour company has not accepted any fixed deposits and,as such,no amount o

284、f principal or interest was outstanding as of the balance sheet date.DirectorsDuring the year,Mr.Ramesh Vangal retired as a director and your directors inducted Mr.Claude Smadja,Principal Advisor of the World EconomicForum,as an additional director of the company,in his place.His appointment require

285、s the approval of the members at the ensuing AnnualGeneral Meeting.As per Article 122 of the Articles of Association,Mr.Nandan M.Nilekani,Mr.K.Dinesh,Mr.Philip Yeo,Mr.T.V.Mohandas Pai and Mr.PhaneeshMurthy retire by rotation in the forthcoming Annual General Meeting.All of them,being eligible,offer

286、themselves for reappointment.AuditorsThe auditors,Bharat S Raut&Co.Chartered Accountants,retire at the ensuing Annual General Meeting and have confirmed their eligibility andwillingness to accept office,if reappointed.FII investment limitRecently,the Government of India raised the investment limit i

287、n an Indian company for Foreign Institutional Investors(FII)from 49%to themaximum level approved under the FDI for that industry,subject to the approval of the board of the investee company and a special resolution bythe shareholders of such a company.The maximum FDI level applicable for the softwar

288、e industry is 100%,at present.Your directors are of theopinion that it would be in the interest of the company to increase the limit of such investment to 100%.The necessary resolutions are beingplaced before the members in the ensuing Annual General Meeting.Conservation of energy,research and devel

289、opment,technology absorption,foreign exchange earnings and outgoThe particulars as prescribed under subsection(1)(e)of section 217 of the Companies Act,1956,read with the Companies(Disclosure of particularsin the report of Board of Directors)Rules,1988,are set out in the annexure included in this re

290、port.Particulars of employeesAs required under the provisions of section 217(2A)of the Companies Act,1956,read with the Companies(Particulars of employees)Rules,1975,as amended,the names and other particulars of employees are set out in the annexure included in this report.AcknowledgmentsYour direct

291、ors thank the companys clients,vendors,investors and bankers for their continued support during the year.Your directors place onrecord their appreciation of the contribution made by employees at all levels,who,through their competence,hard work,solidarity,cooperationand support,have enabled the comp

292、any to achieve consistent growth.Your directors thank the Government of India,particularly the Ministry of Communication and Information Technology,the Department ofElectronics,the Customs and Excise Departments,the Software Technology Parks Bangalore,Chennai,Hyderabad,Mohali,Mysore,Pune,Bhubaneswar

293、 and New Delhi,the Ministry of Commerce,the Ministry of Finance,the Reserve Bank of India,VSNL,the Department ofTelecommunications,the state governments,and other government agencies for their support,and look forward to their continued support in thefuture.For and on behalf of the board of director

294、sBangaloreNandan M.NilekaniN.R.Narayana MurthyApril 10,2002Chief Executive Officer,President andChairman and Chief MentorManaging Director27Annexure to the directors reporta)Particulars pursuant to Companies(Disclosure of particulars in the report of the Board ofDirectors)Rules,19881.Conservation of

295、 energyThe operations of your company are not energy-intensive.However,adequate measures have been taken to reduce energy consumption byusing energy-efficient computers and by the purchase of energy-efficient equipment.Your company constantly evaluates new technologiesand invests in them to make its

296、 infrastructure more energy-efficient.Currently,your company uses CFL fittings and electronic ballast toreduce the power consumption of fluorescent tubes.A building automation system to control the working of air conditioners and to makethem more energy-efficient has been implemented.Air conditioner

297、s with energy efficient screw compressors for central air conditioning areused and air conditioners with split air conditioning for localized areas are used.High efficiency,hydro-pneumatic pumps are being used inwater pumping systems.As energy costs comprise a very small part of your companys total

298、expenses,the financial impact of these measuresis not material.In addition,your company is using amorphous core transformers in place of conventional transformers in all its locations,which operateat an efficiency of 97%.Your company is also using power factor correctors at the supply level of the s

299、tate grid power to achieve highenergy efficiency.2.Research and Development(R&D)Research and development of new services,designs,frameworks,processes and methodologies continue to be of importance at yourcompany.This allows your company to enhance quality,productivity and customer satisfaction throu

300、gh continuous innovation.a.R&D initiative at institutes of national importanceThis initiative has been described in the research and education initiatives section in the directors report.b.Specific areas for R&D at your companySince business paradigms and technologies are changing constantly,continu

301、ous investments in research and development are of paramountimportance.Your company has taken the approach that its research must be beneficial to the company and to its clients either in the short-term or in the medium-term.As in earlier years,your company continues to conduct research in the areas

302、 of software engineering,projectmanagement,global delivery,emerging technologies,and new tools and techniques.Research has been continuing in the areas of software architecture and performance engineering.This is to help deliver high-performanceand high-transaction-volume software solutions to clien

303、ts.Research has also been continued in object and component technologies to createmodules that enable repeatability across projects.Your company continues to undertake research in the following areas:?E-commerce:Your company carried out extensive research in the areas of legacy integrations,web serv

304、ices and other technologies ofinterest.?Concept centers:Initiatives were taken to set up concept centers in advanced technologies and,presently,are in advanced stages ofconclusion.?General software engineering:Your company is constantly improving its methodologies to increase quality and productivit

305、y,and toreduce time-to-market for its clients.?Products:Your company continues to enhance and develop additional products in the banking area.Your company has various groups engaged in R&D.The Education and Research(E&R)department conducts short-term and long-termresearch in the areas of knowledge m

306、anagement,performance testing,e-commerce,education and training methodologies,and technology-based mechanisms for delivery of education.During the year,the E&R team published 25 papers in leading international/national journalsand conferences.Some of your company employees were invited to deliver pr

307、esentations.The Infosys Performance Testing Center establishedlast year has provided performance solutions to a number of development projects.c.Benefits derived as a result of R&D activityYour company has been able to maintain margins despite changes in technology and increased personnel costs.Furt

308、her,the Infosys PerformanceTesting Center and the e-commerce research labs have been instrumental in building expertise in the areas of software performance solutions,testing,architecture and prototype development.d.Future plan of actionThere will be continued focus on,and increased investment in,th

309、e above R&D activities.Future benefits are expected to flow in frominitiatives undertaken this year.e.Expenditure on R&D for the year ended March 31in Rs.crore2002%2001%Revenue expenditure14.40%14.97%Capital expenditure0.46%2.14%Total R&D expenditure14.86%17.11%R&D expenditure as a percentage of tot

310、al revenue0.57%0.90%283.Technology absorption,adaptation and innovationDuring the year,your company successfully migrated the enterprise messaging infrastructure to the Microsoft Exchange 2000 backbone.Further,your company made significant additions to the number of servers used for software develop

311、ment,and to the number of file andprint servers.During the year,your company also implemented video streaming and web-casting facility using Multicast technology to reach out to allemployees.Your company has strengthened video conferencing capabilities for internal use and customer communication by

312、deployinghigh-end Accord Video Bridges and Polycom Conferencing systems.Remote access facility to your companys network is extended to itsemployees worldwide by value added services such as IPASS and Extranet.Your company entered into special agreements with telecomservice providers to extend voice

313、communication from customers to employees residences and vice versa using Voice VPN technology.Your company further invested in middleware technologies,mobile technologies and legacy modernization technologies.Your company hasset up laboratories and Centers of Excellence for technology research and

314、competency building.Your company joined several technicalstandards organizations,and continues to be capable of providing total technology solutions to its clients using new technologies and tools.4.Foreign exchange earnings and outgoa.Activities relating to exports,initiatives taken to increase exp

315、orts,development of new export markets forproducts and services,and export plansYour company has had a strong export focus in the past,and expects its export thrust to continue in the future.In fiscal 2002,98.04%ofrevenues were derived from exports.Over the years,your company has established a subst

316、antial direct marketing network all over the worldand now has marketing offices in North America,Europe and the Asia Pacific region.These offices are staffed with sales and marketingspecialists who sell your companys services to large,international clients.During the year,your company opened marketi

317、ng offices in the Netherlands,Singapore,and Switzerland.Your company also launched aglobal initiative to increase the awareness of the Infosys brand,and of its products and services.Several press and public relations exerciseswere launched in the US to enhance your companys visibility.Further,your c

318、ompany plans to take part in several international exhibitionsto promote its products and services.The long-term goal of your company is to be a highly respected name in the global market for its services and products,and to continue torealize a significant portion of its revenue from exports.b.Fore

319、ign exchange earned and used for the year ended March 31in Rs.crore20022001Foreign exchange earnings2,495.501,728.23Foreign exchange outgo(including capital goods and imported software packages)1,072.15727.53For and on behalf of the board of directorsBangaloreNandan M.NilekaniN.R.Narayana MurthyApri

320、l 10,2002Chief Executive Officer,President andChairman and Chief MentorManaging Director29Annexure to the directors reportb)Information as per Section 217(2A)of the Companies Act,1956,read with the Companies(Particulars of employees)Rules,1975,and forming part ofthe directors report for the year end

321、ed March 31,2002Sl.NameDesignationQualificationAgeDate ofExperienceGrossPrevious Employment DesignationNo.(Years)Joining(Years)Remuneration(Rs.)1.Aashish BansalBusiness Development ManagerB.Tech.,PGD3717.02.20001369,47,276HSBC Capital Markets India Pvt.Ltd.,Senior Manager2.Abhay M.KulkarniDelivery M

322、anagerB.E.3526.02.19901413,95,046Tisco,Graduate Trainee3.Ajay DubeyVice PresidentB.Tech.4407.06.19932214,10,039ANZ Bank,Technical Team Leader4.Ajita KiniPrincipalB.Sc.,PGD3616.10.20001369,54,835KPMG Consulting Pvt.Ltd.,Manager5.Akash MaitiSenior AssociateB.E.(H),M.A.,PGD3105.07.2000756,69,877Anderse

323、n Consulting,Senior Consultant*6.Akihiro KomiyamaBusiness Development ManagerMBA4219.11.20011614,34,941Breit Consulting Co.Ltd.,Managing Director7.Albena De AssisSoftware DeveloperB.Sc.2717.07.2000418,38,591Siemens,Software Developer8.Albert Denis LewisSenior Program ManagerMS,MBA4205.02.20012053,47

324、,099Profitech,Consultant*9.Alex W.YangSenior AssociateBS,MBA3330.07.2001736,48,434Onsite Access Inc.,Senior Manager e-business*10.Alexander Graham McgregorAccount ManagerB.Sc.,Diploma4916.07.20012921,34,427Syntel Inc.,Senior Project ManagerPringle*11.Alexander ZmoiraSenior PrincipalBS,MBA3725.06.200

325、1858,63,700Intnl Business CGE&Y,Senior Manager Consulting Services12.Alexandre Elvis RodriguesBusiness Development ManagerB.Tech.,MBA3103.08.1998865,86,274Modi Xerox,Production Sales Manager13.Amar VaidyaBusiness Development ManagerB.E.,MBA3230.11.2000938,27,807Andersen Consulting,Consultant14.Ameer

326、 SaithuAssociateB.Tech.,PGD2927.03.2000644,27,826PricewaterhouseCoopers,Consultant*15.Amit KhetarpalBusiness Development ManagerB.E.,MBA3410.09.2001913,05,279Booz-Allen&Hamilton,Associate16.Amit Kumar BhadraSenior Manager and HeadB.Sc.,M.Sc.3622.01.19981612,42,890Unit Trust Of India,Asst.General Man

327、agerImplementation Internet BankingBanking Business Unit*17.Amit NangaliaSoftware EngineerB.A.2325.06.2001123,26,38018.Amitabh Pushparaj MudaliarSenior AssociateB.E.,PGD3020.03.2000748,76,264PricewaterhouseCoopers,Consultant19.Amy(Yuen Chun)WongSoftware EngineerB.Sc.2422.01.2001227,12,009Hewitt Asso

328、ciates,Quality Assurance Analyst*20.Amy VelozAdministrative AssistantBBA2921.06.20011114,48,417Eclubbuy San Juan Capistrano,Senior Product MarketingAssociate/Supervisor21.Anand KrishnaSenior PrincipalB.E.,MBA3612.07.20001232,68,355Pricewaterhouse Coopers,Sr.Manager Transaction Services22.Anand Naray

329、anaswamyProgrammer AnalystB.Com.2802.04.2001826,81,659Paras International Gmbh,Prokurist(General Manager)*23.Anand P.ArkalgudBusiness Development ManagerB.E.,MBA3019.11.2001812,52,483Techone Inc.,Sr.Manager Business Development*24.Anand SubramanianSenior AssociateB.Com.,CA2908.06.2000623,03,116Arthu

330、r Andersen,Senior Consultant25.Anand UppiliBusiness Development ManagerB.E.(H)3514.12.20001442,13,097Tellabs International Inc.,Product Manager26.Ananda RaoBusiness Development ManagerB.E.,M.Sc.4325.10.19991551,86,288Se IT Technologies,Regional General Manager27.Anant NatekarProject ManagerB.E.2609.

331、02.2001428,90,794Fourth Technologies Inc.,Consultant28.Andi BerkowitzAdministrative AssistantB.A.,ASL4912.04.19991222,23,183Newton Wellesley Chinopractic,Office Manager29.Andreas SuweProject ManagerBLaws,Diploma3505.03.2001828,72,812Tucows Inc.,Project Manager*30.Andrew K.NoelBusiness Development Ma

332、nagerB.Com.2613.08.2001421,53,446Kumaran Systems Inc.,Account Manager*31.Andrew R.FriedmanPrincipalB.Sc.,MBA3926.11.20011522,38,281Convergent Group,Director Customer Relationship Mgmt.Prac.*32.Aniket Kishore UllalBusiness Development ManagerB.A.,PGD2628.05.2001513,51,808Indstudent.Com,Co-Promoter*33

333、.Aniket Rajiv MaindarkarBusiness Development ManagerB.Sc.,MBA3001.06.2001836,29,255Patni Computer Systems,Manager Business Development34.Anil RoyProgrammer AnalystB.E.2719.02.2001536,45,569Air Check Virginia,Database Administrator35.Anilkumar NechiyilProject ManagerB.Sc.4103.01.20011943,83,543First Data Merchant Services,Project Technical Leader36.Ankur GuptaBusiness Development ManagerB.A.(H),PGD