Hewlett-Packard’s Haas, Iannotti Leave in Executive Shuffle

May 21, 2011, 2:33 PM EDT By Aaron Ricadela and Cristina Alesci

(Adds KKR comment in the seventh paragraph.)

May 21 (Bloomberg) -- Hewlett-Packard Co. senior vice presidents Marius Haas, Tom Iannotti and Gary Budzinski are departing, people familiar with the matter said, adding to an exodus of managers from the computer maker.

The company is also looking for a new senior executive who may lead its software business, people familiar with the search said. Executive Vice President Bill Veghte currently is in charge of that division.

Haas, who led Hewlett-Packard’s computer networking business, is departing for private-equity firm KKR & Co., said two people, who asked not to be identified because the job change is confidential. Iannotti, who was in charge of enterprise services, is retiring, while Budzinski, who headed computer maintenance services, is leaving, two people said.

The executives follow Tom Hogan, the former head of business-computing sales, in exiting as Hewlett-Packard faces a drop in demand for personal computers and narrowing margins in services. Chief Executive Officer Leo Apotheker, who took the helm Nov. 1, aims to revive growth and slice costs after cutting $1 billion from his annual sales projection this week and issuing current-quarter forecasts that missed estimates.

“There’s been a shift in how they think strategically about the business,” said Abhey Lamba, an analyst at International Strategy & Investment Group in New York, who has a “hold” rating on Hewlett-Packard shares. The company is trying to emphasize revenue growth over short-term profit, he said. “You’re going to see people leave and new blood come in.”

Cisco Background

As head of networking, Haas managed Hewlett-Packard’s foray into the communications-equipment market led by Cisco Systems Inc. He previously worked as senior vice president of strategy and corporate development, responsible for such tasks as integrating acquisitions.

“Marius brings a great mix of deal experience as well as an understanding of business and technology,” said Adam Clammer, head of KKR’s technology group. “He’ll help us source deals and work with companies once we own them.”

Mylene Mangalindan, a spokeswoman for Palo Alto, California-based Hewlett-Packard, declined to comment on the departures.

Hewlett-Packard has lost 14 percent since the day before Apotheker became CEO. It slid 15 cents to $35.98 yesterday in New York Stock Exchange composite trading.

Interim Job

Iannotti managed Hewlett-Packard’s technology outsourcing and consulting services. He will stay until Hewlett-Packard hires a new executive to lead its services business, one of the people said. Budzinski’s departure was announced in a memo to Hewlett-Packard employees this week.

Executive Vice President Ann Livermore is managing the services business on an interim basis while the company searches for a new executive to lead the division, Apotheker told analysts on a conference call this week.

During the call, he said Hewlett-Packard was signing too high a proportion of less profitable technology outsourcing contracts, which involve managing companies’ information- technology operations, and too few consulting agreements that advise customers on introducing new software applications and online cloud computing services. Those are often more profitable.

Executive Vice President David Donatelli, who runs the company’s data-center hardware unit, now heads the technology services business that was managed by Budzinski.

Turnaround Effort

Hewlett-Packard’s disappointing forecasts reflect rivalry from tablets such as Apple Inc.’s iPad and lower margins in the computer-services division. Apotheker sent a memo earlier this month warning of “another tough quarter” in the July period.

Apotheker hired Martin Homlish as chief marketing officer, Hewlett-Packard said last month, as part of his turnaround effort. The move followed the exit in January of former marketing head Michael Mendenhall and came a day after Hewlett- Packard said Jan Zadak will run business-computing sales, replacing the departing Hogan.

In March, the company named Tracy Keogh, a former Hewitt Associates executive, as head of human resources. It has also hired Zorawar “Biri” Singh, a former executive at International Business Machines Corp., as senior vice president in its cloud-computing services unit.

--Editors: Tom Giles, Sylvia Wier

To contact the reporters on this story: Aaron Ricadela in San Francisco at aricadela@bloomberg.net; Cristina Alesci in New York at calesci2@bloomberg.net.

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

View the original article here