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Motorola's No. 2 quits after 4 years

Motorola Inc. announced Wednesday that Mike Zafirovski is resigning as the company's No. 2 executive, a departure that had been widely expected since he was passed over for the chief executive's job a year ago.

Zafirovski, who helped engineer a turnaround at the cell-phone manufacturing giant, is scheduled to step down Jan. 31 as president and chief operating officer after more than four years with Motorola.

He was beaten out for the CEO's job in December 2003 when the company opted to replace Christopher Galvin with Ed Zander, former president of Sun Microsystems Inc.

Zafirovski, 51, arrived at Motorola in 2000 to head its then-struggling cell-phone business before being promoted to president in 2003. The company said he will serve in an advisory role during the transition to a new leadership structure, underscoring that he is leaving on good terms.

"Mike's intense focus on improving the company's operations and product quality has helped us execute on our commitments, enabling Motorola to achieve increased customer satisfaction and strong financial performance," Zander said.

Motorola spokeswoman Jennifer Weyrauch said Zafirovski will not be replaced. Instead, Motorola's four group presidents will report directly to Zander.

Zafirovski indicated he has not yet decided on his next job. He cited the company's recent spinoff of its semiconductor business into Freescale Semiconductor Inc. and its announcement of a new organizational structure as reasons for the timing.

"This is a decision I have considered carefully and which I discussed at length with Ed," he said. "This is the right time for me to start considering other opportunities."

Before joining Motorola in 2000, the native of Macedonia worked 24 years at General Electric Co., serving as president and CEO of four businesses at GE Capital. He joined Boeing Co.'s board of directors in October.

Morningstar Inc. analyst John Slack said the departure "definitely leaves a hole" at Motorola but was not unexpected. He said Zafirovski helped fix inventory and quality problems in the Schaumburg, Ill., company's handset business and spearheaded the effort to refresh its product line with "hot new phones" such as the ultraslim Razr.

"A lot of this stuff has come to fruition since Zander's been on board," he said. "But it was all set in motion before he got there, and Zafirovski was the leader of the group."

Analyst Kevin Dede of Merriman Curhan Ford & Co. said Zafirovski's experience at GE helped him institute more rigorous management controls at Motorola. "Profitability in their handset group has improved tremendously, and I think a lot of it is due to his leadership there even though he's moved up in the ranks," he said.

Motorola said last month it is realigning its businesses into four groups in organizational changes designed to improve its focus and operating efficiency. Their presidents are Ron Garriques, mobile devices; Dan Maloney, connected home business; Greg Brown, government and enterprise; and Adrian Nemcek, networks.

The company said Zafirovski will not run for re-election to its board of directors in May.

Motorola shares fell 17 cents to close at $16.47 on the New York Stock Exchange and are just below the middle of their 52-week trading range.