Peerless Group Inc. has promoted Kevin Marsh to executive vice president in charge of directing the company's marketing strategy in banking software and outsourcing.
The move comes amid an unexpected lag in software sales to Peerless' primary market-community banks and credit unions.
"We had hired some new people, and they weren't getting the kind of management attention that a new sales force needs," said Rodney L. Armstrong Jr., chairman and CEO at Richardson, Tex.-based Peerless.
For the past year Mr. Marsh, 44, worked in the company's upstart service bureau division, which officials said has been more successful.
Before that, Mr. Marsh led the sales effort for Peerless' core banking software.
"We have some very good salespeople" in the software unit, Mr. Marsh said. They "need someone who can provide a little guidance and mentoring."
He said he will coach them in dealing with banks and credit unions that may take six months before deciding to buy a system.
"I have absolute confidence that we will be able to turn (Peerless) around in a very short time," he said.
Mr. Marsh had been with Electronic Data Systems Corp., Plano, Tex., since 1980. He left when Peerless was spun out of EDS in a 1989 management buyout.
Peerless' lagging sales will apparently have a bottom-line impact. Last week the company disclosed to investors that it will not meet its third- quarter earnings projection of 14 cents a share.
That news and subsequent analyst downgrades sent the stock down to $5.125 last Friday, a loss of $1.125.
The earlier move of Mr. Marsh to outsourcing may have hurt software sales, said Robert Meeder, senior vice president at George K. Baum & Co., Kansas City, Mo. He said Peerless appeared to be suffering from "some growing pains."
He downgraded the company to "neutral" from "buy."
"We are taking a show-me attitude to see the backlog build and some actual contracts signed before we go positive on the stock," Mr. Meeder said.
The company may earn only 6 cents in the third quarter, based on revenues of $7.4 million, Mr. Meeder said. That would be up from $6.7 million a year earlier.
Mr. Meeder said the company's overhead has also grown, with increased sales staff and higher research and development costs involving year 2000 preparations.
Peerless' management, which owns about 25% of the company, said it has begun a program to boost the stock. Shares have recovered somewhat; they were trading at $5.625 early Wednesday.