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Former server exec gets new role at HP

Mary McDowell, who has been on a sabbatical, steps into a new role that oversees corporate strategy, putting to rest speculation that she might head to one of HP's rivals.

Hewlett-Packard has shifted former server executive Mary McDowell into a new role in which she will help oversee corporate strategy, CNET News.com has learned.

McDowell, who has been on a sabbatical since a May restructuring of HP's high-end computing business, returned to work last month as senior vice president of strategy and corporate development. In the new post, McDowell will help the company with its strategic review process, coordinate functions between HP's five major business units and plan its acquisition strategy.

Although McDowell served a stint in a planning role at Compaq Computer before heading the company's Intel-based server business, the new job is a shift.

"Consumer is new; printing is new," McDowell said in an interview Wednesday. "It's back-to-school time."

In finding a new position for McDowell, HP is hoping to put to rest speculation that the executive might head to one of HP's rivals in the server business. HP leads in the sale of Intel-based servers but trails behind IBM for the overall server revenue crown.

McDowell, who will report to Chief Technology Officer Shane Robison, is part of the company's office of strategy and technology, which manages acquisitions, divestitures and minority investments. The unit also oversees companywide initiatives, including efforts in mobile technology, security and multimedia.

HP is made up of "very strong businesses run by very strong general managers," McDowell said. "One of the opportunities for this group is to look for white space between the businesses."

The company is also seeking to return to profits--a year after completing its merger with Compaq. Although widely praised for its early integration efforts, HP has come under fire after missing sales and earnings expectations last month. The company briefly returned its PC unit to profitability and had narrowed the loss in its high-end computing group, but both businesses posted hefty losses last quarter.

In response, HP has cut more jobs, particularly in the unit that sells servers, software and storage, and has said it will reach its goal of returning that unit to profitability this quarter. On the PC side, HP said it was hurt by reducing prices too much. Even with the lower prices, Dell grew market share at a faster clip.

In her new role, McDowell replaces John Brennan, who will switch to a new position heading up sales to small- and medium-size businesses. Brennan will report to Duane Zitzner, head of HP's PC unit.

The change likely waters down McDowell's role, Illuminata analyst Jonathan Eunice said. "She could now be Carly's right-hand woman for all we know, but she's now an influencer and no longer the decision-maker," he said. "Make her executive vice president and general manager of corporate strategy if you want; it's still a staff job compared to the line job she held--in a product line-division that she essentially created and wrangled with great success for (several) years."

CNET News.com's Stephen Shankland contributed to this report.