Dell exec departures spark worry

The man who led Dell's acquisition strategy has left for Blackstone and analysts wonder how it'll affect the company's software and services strategy.

In recent months, Dell has lost its senior vice president of corporate strategy, the head of its storage business and the leader of the company's services business. The revolving door has analysts questioning whether Dell will remain committed to its merger and acquisition-led transition to become more of a software company.

On Tuesday, Dell said Dave Johnson, senior vice president of corporate strategy, is leaving to go to Blackstone, a top investment firm. Johnson joined Dell in 2009 from IBM and started an acquisition spree to beef up the company's software and services business.

The overall goal for Dell is to diversify away from the PC business. Johnson orchestrated the Compellent and Quest Software acquisitions.

Johnson's departure comes after the company said Steve Schuckenbrock, head of Dell's services unit, would leave to pursue outside opportunities. Schuckenbrock, who will stick around until March to ease a transition, joined Dell in 2007 and was visible.



In addition, Dell's enterprise storage leader, Darren Thomas, left the company. Both the Thomas and Schuckenbrock departures were outlined in December.

Now Dell has executives to replace the ones leaving. Johnson job will be split between Prakash Jothee, who will take corporate strategy, and Chris Kleinman, who will focus on corporate development.

Dell also hired Marius Haas as president of enterprise solutions and that move could have sent Thomas packing. Suresh Vaswani, a former Wipro executive, takes over for Schuckenbrock.

Regardless, analysts are wondering about Dell's strategy amid the high-level departures in December and January.

Barclays analyst Ben Reitzes said:

Dell attempted to take on more characteristics of IBM – and worked to steer its business away from PCs. We believe Dell still has a long way to go since we calculate about 70% of revenue are actually tied to PC’s if maintenance is included – and maintenance is Dell’s most profitable business.

Reitzes added in a research note that how Johnson's departure affects Dell's strategy remains to be seen. Reitzes also questioned future growth for Dell's storage and services units.

Meanwhile, Cindy Shaw, an analyst at Discern, said that Johnson's departure was a "crucial loss for Dell" since he was the linchpin behind the company's acquisitions and attempts to change its culture.




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