Key I.B.M. Manager Jumps to Xerox

Key I.B.M. Manager Jumps to Xerox

By John Markoff
The New York Times

December 6, 1988

The International Business Machines Corporation executive who has served as a lightning rod for criticism of the company's personal computer marketing strategy resigned yesterday to head product planning, development and manufacturing at the Xerox Corporation.

The resignation of William C. Lowe, 47 years old, who was the architect of I.B.M.'s entry into the personal computer marketplace in 1981 and who has served as president of the company's entry systems division since 1985, focuses attention on difficulties now facing the computer giant.

In recent years, the I.B.M. personal computer line has been battered by competition from clone machines, and the giant computer maker has struggled in its attempt to differentiate its profitable mainframe computer line from increasingly powerful and inexpensive work stations and personal computers.

Mr. Lowe's resignation had been rumored for six months, but I.B.M. officials denied yesterday that his departure was related to infighting surrounding the company's PS/2 personal computer line, introduced in April 1987.

The new PS/2 computers have a feature known as the Micro Channel, for handling data, that is incompatible with the original I.B.M. Personal Computer and PC/AT products. Critics have said that the decision to discontinue the PC/AT computer line when the new PS/2 line was introduced was a mistake, giving I.B.M.'s competitors a chance to take away market share. The PS/2 line has been slow in gaining acceptance, although it has been showing strength in recent months, industry analysts said.

This summer the computer maker introduced a new machine that is compatible with its original computer line, and that system has been selling well.

Several industry analysts said yesterday that they did not think Mr. Lowe had been shunted aside, as has been rumored frequently in recent months, but that his chances for quick advancement had been limited at I.B.M. Several months ago, Richard T. Gerstner was appointed I.B.M. vice president and general manager of I.B.M. personal systems, the crucial position in shaping the company's strategy for desktop computers.

''My being here isn't so much a reflection on I.B.M.,'' Mr. Lowe said from his new offices at Xerox. ''I feel I still had runway there, but this seemed like such a great opportunity.''

Mr. Lowe said that he was familiar with Xerox's difficulties in bringing its technology from the laboratory to the marketplace and that he thought the company still had excellent technology that would make it competitive in the future.

''There are a lot of great things in the laboratories here that will serve us well in the future,'' he said.

Mark Stahlman, an industry analyst at Sanford C. Bernstein & Company, said, ''Bill Lowe has contributed to creating the desktop computer industry and his opportunities have just transferred to Xerox.''

Industry executives said they did not think Mr. Lowe's departure signaled a major shift at I.B.M. ''It's too bad to have Bill Lowe go,'' said William Gates, chairman of the Microsoft Corporation. But he added, ''Within I.B.M., one person changing doesn't signify a whole strategy shift.''

An Earlier Shake-Up

Mr. Lowe's departure followed a shake-up in which R. Andrew Heller, a computer scientist at I.B.M. who reported to Mr. Lowe and headed the company's PC/RT work station development effort, was given a special corporate science assignment recently. He had been I.B.M.'s vice president and general manager for advanced engineering systems in the entry systems division. Mr. Heller has been a contentious figure at I.B.M. because of his goal of bringing the power of the mainframe to the work station market at work station prices, rather than trying to preserve the mainframes' markets.

In the wake of Mr. Lowe's departure, I.B.M. restructured its personal systems division into two groups, splitting powerful work stations off from personal computers. Under Mr. Lowe, that division had been informally divided. Mr. Lowe said frequently during 1988 that I.B.M. was spending equally on research and development for both personal computers and work stations.

The New Appointments

James A. Cannavino, an I.B.M. vice president, was named president of I.B.M.'s entry systems division, reporting to Mr. Gerstner. Mr. Cannavino had been president of I.B.M.'s data systems division.

The new advanced work stations division will be headed by Nicholas M. Donofrio, who will also report to Mr. Gerstner. Mr. Donofrio was vice president of development at the entry systems division.

At Xerox, Mr. Lowe will succeed Wayland R. Hicks. Mr. Hicks, 45, will assume responsibility for worldwide marketing operations at Xerox on Feb. 1.