IBM Corp. today announced that Jim Whitehurst, the company’s president, has decided to step down.

Whitehurst’s departure is part of a broader leadership reshuffle that will affect several major business units. The company’s share price dropped more than 4.8% on news.

Whitehurst (pictured) joined IBM in 2019 after the company closed its landmark $34 billion acquisition of software maker Red Hat. Whitehurst served as chief executive of Red Hat from 2007 until the acquisition. Under the executive’s leadership, Red Hat established itself as a major player in the enterprise software market, with a portfolio spanning one of the industry’s most popular Linux distributions, applications for managing cloud infrastructure and software development tools.

After IBM completed the acquisition, Whitehurst came aboard as president and oversaw Red Hat’s integration into the company. The software products that IBM obtained through the transaction are now a central component of its strategy to boost revenue growth and improve profitability. The importance of Red Hat to IBM’s growth strategy makes the departure of Whitehurst all the more significant.

Red Hat’s sales increased 17% year-over-year last quarter when “normalized for historical comparability,” IBM said in April. The unit’s strong performance helped IBM surpass analyst expectations and return to revenue growth in the quarter.

“Jim has been instrumental in articulating IBM’s strategy, but also, in ensuring that IBM and Red Hat work well together and that our technology platforms and innovations provide,” IBM CEO Arvind Krishna wrote in the announcement of the leadership changes today. After stepping down from his current role, Whitehurst is set to continue working as a senior advisor to Krishna and the rest of IBM’s leadership team.

Whitehurst appeared on SiliconANGLE Media’s theCUBE studio in May (below) to discuss, among other things, IBM’s strategy. “We’re investing in areas where we think we can uniquely add value that need to happen that others aren’t doing,” the executive said, pointing out the company’s work in fields such as artificial intelligence and quantum computing.

On IBM’s approach to delivering technologies such as AI to its enterprise customers, Whitehurst said that “today, technology is the forefront of developing or building competitive advantage for almost any business, and so nobody wants to kind of hand the keys. So we no longer are necessarily doing things for our clients, we’re doing things with our clients.”

Whitehurst’s stepping down is a concern to some observers who thought Red Hat’s culture would be important to turning around IBM.

“To me it’s concerning,” said Dave Vellante, chief analyst at SiliconANGLE’s sister market research firm. “Whitehurst is Mr. Culture and a beacon for the Red Hat side of the house. The line has always been something like, if IBM becomes Red Hat, it’s a win but if Red Hat becomes IBM, they’re in trouble. His leaving says to me that he doesn’t believe enough in the hybrid cloud vision to see it through.”

Constellation Research Inc. analyst Holger Mueller said the move indicates the board is satisfied with Krishna’s direction. “It also means that despite all intentions not to make Red Hat IBMified, it still is happening,” he said. “And the board did not want an outsider so much anymore.”

IBM announced several other leadership changes in conjunction with the departure of Whitehurst. Bridget van Kralingen, currently the senior vice president of global markets, will become the senior vice president of special projects for one year and then retire from the company. IBM’s new global markets lead will be Rob Thomas, who currently heads the software, cloud and data platform unit.

Elsewhere in the company, Tom Rosamilia has been appointed as senior vice president of the cloud and cognitive software business. That’s the business Krishna led before becoming IBM’s CEO in 2020. The unit oversees key products such as IBM’s Cloud Pak lineup of cloud infrastructure management and artificial intelligence applications, which the company has been expanding recently as part of its revenue growth strategy. IBM’s cloud and cognitive software revenue reached $5.4 billion last quarter thanks to a 3.8% growth rate, one of the highest among its core business divisions.

Former Hewlett Packard Enterprise Co. executive Ric Lewis has been named as the new senior vice president of systems. Lewis previously led HPE’s Software Defined & Cloud Group, which encompasses many key components of the technology giant’s hybrid cloud business. IBM’s systems business includes its mainframe, server and storage equipment storage lines. 

The company also disclosed today that Kelly Chambliss has been promoted to the role of senior vice president, Americas and strategic sales at IBM’s global business services division, while Roger Premo will lead the business development group. 

“Bringing value to our clients is — and must continue to be — our north star,” Krishna said. “For our clients as well as for IBM, our technology platform and services serve as an important driver of business growth. With these changes, I am confident that IBM will be in a stronger position to help our clients and our business thrive.”

With reporting from Robert Hof

Photo: SiliconANGLE