Mitel Shakes Up, RefocusesMitel Shakes Up, Refocuses

New CEO Richard McBee announces business unit and sales changes, mid-market focus, and departure of longtime exec Paul Butcher.

Mitel yesterday announced an organizational shakeup and a focus on the mid-sized market, with a de-emphasis on the low-end 1-99-station market. As part of the shakeup, veteran President and COO Paul Butcher has left the company. McBee is assuming the title of President, and the COO role has been eliminated.

On a conference call yesterday, the company's new CEO, Richard McBee, said Mitel had three objectives with the shakeup:

* "simplify our organizational structure"
* "focus our R&D investments for the mid-market"
* "realign sales and our sales channel in the United States"

The re-organization will divide Mitel into three business units, as described in the company's announcement:

* Mitel NetSolutions: responsible for network and hosted services, mobile services, and broadband connectivity. Jon Brinton will continue to lead this business unit as the General Manager.

* Mitel DataNet: responsible for the distribution of third-party products to partners and customers. Ryan Donovan is promoted to the role of General Manager.

McBee also announced that Mitel would consolidate its sales organizations into two groups: North America and international.

As far as the shift in R&D focus to the mid-market, McBee said in the conference call, "We're not abandoning, obviously, the low end; we've had good success there. But I think that you have to understand that the sub-100 market space is really about a financial transaction. They’re much more focused on the cost of the solution. And the 100-500 and 500 to 2,500 are really kind of a best of breed play."

Mitel will continue to have a Major Accounts Group to support larger enterprise customers; but the 100-2,500-station market is one that buys through indirect channels, and so Mitel will emphasize that sales channel for its mid-market focus, McBee said.