Almost nine months after Infosys Technologies established its subsidiary in the US for targeting over a $100-billion government outsourcing market, Eric Paternoster-the current head of insurance and healthcare business at the company, has taken charge as the chief executive of Infosys Public Services.
Paternoster will report to Ashok Vemuri, who heads Infosys’ US business, and also work with the company’s independent director Jeffrey Sean Lehman.
Infosys Public Services board is constituted of SD Shibulal, Mohandas Pai, Vemuri, Lehman and Paternoster himself.
When contacted by ET last week, S (Kris) Gopalakrishnan, the Infosys CEO confirmed this appointment, and said his company is currently in the process of fine-tuning its strategy for addressing government outsourcing market in the US.
Infosys, which serves top corporate customers such as American Express, Bank of America and BP Plc, leads domestic rivals Tata Consultancy Services (TCS) and Wipro in terms of profitability with almost 30% operating margins.
While both TCS and Wipro have several state governments as their public sector customers in the US, Infosys, according to rivals and some experts, may have been late in addressing the opportunity. Rival Wipro already has a nine year $407 million outsourcing contract from the State of Missouri for delivering health care services to US citizens. “We are never late,” said Mr Kris. “As we scale up the business, we have to look at all sectors. We will always be selective about what we want to work at, depending on the business model and services to be provided, we have to look at what is profitable,” he added. US IT budget is $82 billion for fiscal 2010, of which $35 billion is in the defense department. Other departments that might be available for vendors such as Infosys are justice, transportation, homeland security, health and human services, commerce, energy, veterans administration, agriculture and treasury, said experts.