Management of Human Resources at INFOSYS
“Our assets walk out of the door each evening. We have to make sure that they come back the next morning” (as stated by Narayana Murthy former, CEO of INFOSYS.) At a time when organisations are debating the strategic importance of their human resources, Infosys, a consulting and software services organisation, includes its human resources on its balance sheet to affirm their asset value. The rationale for this is as follows: “The long term success of a company is usually examined on certain financial and non-financial parameters. Human resources are among these new non financial parameters that challenge the usefulness of evaluating corporate success solely on traditional measures. Human resources represent the collective expertise, innovation, leadership, entrepreneurial and managerial skills endowed in the employees of an organisation.” As a knowledge intensive company, Infosys recognises the value of its human assets in maintaining its competitive position. It realises that these assets can easily walk away, as competitors in India and abroad covet its IT talent. Consequently, the challenge facing Infosys is how to attract, retain and develop its human assets in a highly competitive and dynamic environment? Most of the current human resource practices at Infosys result from the vision of the leaders and the culture that they have created. Narayana Murthy, known for his leadership and vision is the public image of Infosys. His leadership style is humble and straight-forward, quite uncommon in the world of Indian business. He believes in sharing wealth with his employees and in leading by example. In a knowledge-based business like Infosys, he sees the importance of consistency in rhetoric and action in empowering employees. He is credited with creating a culture of closeness and empowerment at Infosys. His management style, rare among Indian business leaders, is based on western management.
Why does Infosys recognize the value of its human assets?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → To maintain its competitive position
Option (1) To reduce the hiring cost — Incorrect. Keeping people does reduce the cost of hiring. But the passage never gives that as the reason, and saving cost is not why a knowledge firm values skill.
Option (2) To build brand image — Incorrect. The case is about the firm’s standing against its rivals in the industry, not about the image it presents to customers.
Option (3) To maintain its competitive position — Correct. The passage gives the reason directly. Where the product is knowledge and not a manufactured article, the firm’s advantage rests on the skill and new ideas of its people, not on plant or patents. Able staff are therefore the competitive advantage itself. The passage adds the point that makes this urgent: such assets can walk out of the door.
Option (4) To maximize profit — Incorrect. Profit is a result, not the value being recognised here. The passage itself argues that success cannot be judged by the traditional money measures alone.
Note: The passage is the NCERT case study ‘Management of Human Resources at INFOSYS’, which has been reproduced by NTA in the exam. NCERT (2026-27 Edition): “Management of Human Resources at INFOSYS … As a knowledge intensive company, Infosys recognises the value of its human assets in maintaining its competitive position. It realises that these assets can easily walk away, as competitors in India and abroad covet its IT talent.” |