Riverstone Networks' board of directors this week named Romulus Pereira as chairman of the board and acting CEO, effective immediately.

Pereira, the CEO of Riverstone since its inception, succeeds Piyush Patel as chairman, who will remain on the board as a director. The company also announced that it has launched a search for a new CEO to lead Riverstone's day-to-day operations.

The moves come as Riverstone attempts to tap new markets, such as enterprises and the federal government, to offset sluggish sales to its service provider customers. Like other equipment vendors in the telecom market, Riverstone has been hit hard by the three-year slump in customer spending, posting several consecutive quarters of losses.

The management move allows Pereira to spend more time formulating Riverstone's product and market strategy rather than running daily operations, says Andrew Feldman, Riverstone vice president of corporate marketing and corporate development. Feldman says the management shift was not precipitated by a specific event or series of events.

Indeed, the change means it is business as usual at Riverstone, says Michael Kennedy, principal of Network Strategy Partners.

"This represents no change in business strategy in any way," Kennedy says. "They're sticking with the program. They're not panicked by their results; otherwise, you'd see a more radical change."

Despite Riverstone's new focus on the enterprises and the federal government, Kennedy believes the company should find a CEO who is familiar with selling to large incumbent carriers.

"They need to find someone who can sell to the large U.S. telephone companies," Kennedy says. "It needs to be somebody who knows how those companies buy, someone they can respect as a peer."