Time Inc. CEO Joe Ripp began putting his stamp on the publishing company Wednesday, when employees were told that editors will begin reporting to the organization's business side, a reversal that sent a ripple of anxiety through its editorial offices. Editors of the company's magazines, which include People and Time, had previously reported to the company's editor-in-chief.

Martha Nelson, a well-regarded veteran of Time Inc. who became its editor-in-chief in January, is leaving as part of the changes. Mr. Ripp named Norman Pearlstine to succeed her as the company's top editorial executive, but in the newly created post of exec VP-chief content officer. Mr. Pearlstine was Time Inc.'s editor in chief from 1994 to 2005, during which time he and Mr. Ripp developed a close working relationship, but has been chief content officer at Bloomberg for the past five years.

The changes are effective immediately.

The shakeup is meant to decentralize and streamline Time Inc.'s bureaucracy before the company splits from parent Time Warner next year, Mr. Ripp said in a memo to staff.

It's also the first big structural move that Mr. Ripp has led since joining Time Inc as CEO in September. Time Inc. agreed to buy American Express Publishing's titles just days after he began, but that decision that was in the works before his arrival.

"We believe effective collaboration across business and editorial lines is imperative if we are to succeed as an independent company," he said Wednesday in the memo. "We are confident this new structure will create a strong partnership between business and editorial, promote creativity and result in a cohesive vision for each of our brands that will be essential to long-term growth."

The moves will help make the individual magazines more nimble, Mr. Ripp and Mr. Pearlstine said in an interview.

"Whenever you have a very large organization as ourselves and important decisions need to be cleared through multiple layers it creates a slowdown of the process," Mr. Ripp said. "I'm a firm believer that businesses are more successful when you can empower people at a local brand level."

"It will help create entrepreneurship at the brands," Mr. Pearlstine said.

Ken Doctor, a media analysts with Outsell, said the moves help reinforce that all the brand people, whether from editorial and business, are thinking and working together. "The most important hierarchical line is through the brand," he said.

Under the new structure, editors will report to the group presidents of the three divisions -- lifestyle, news and sports, and style and entertainment -- with "dotted lines" to Mr. Pearlstine, who will report to Mr. Ripp. "In a typical dotted line relationship, as practiced in every other company I've been into, it's usually two to hire, one to fire, meaning both parties are required to hire a new editor and either one can fire an editor," Mr. Ripp said.

Mr. Pearlstine will have responsibility for issues around editorial policy.

Media buyers cheered the shift.

"I think it's a very positive development," said George Janson, managing partner and director of print for GroupM. "Everyone who is in a media organization, regardless of their job title or pay grade, needs to be commercially aware. At the end of the day everyone has some responsibility to profits and losses."

Robin Steinberg, exec VP and director of publishing investment and activation at MediaVest, said Mr. Ripp was making necessary changes. "Breaking traditional structures and approaches allows for greater consumer experiences and stronger marketing opportunities," she said.

But the changes made some editors nervous. Several top editors, who were not told in advance of the shakeup and found out from the same staff memo as everyone else, expressed shock.

"This is a big fucking deal," one editor said.

Ms. Nelson first joined Time Inc. in 1993, going on to help introduce InStyle, edit People and serve as the company's editorial director. Her ascent to the top editorial position this year made her the company's first female editor-in-chief.

Ms. Nelson was not available to comment Wednesday, a Time Inc. spokeswoman said.

A press release from the company quoted Ms. Nelson praising Time Inc. "I am very proud to have been part of Time Inc.'s history and to have had the privilege of creating and working with some of the best brands in the world," she said. 'As this era ends and another begins, I leave Time Inc. confident in the vision and commitment of the entire editorial staff. I believe in the future of our brands and the talented people of Time Inc."

Ms. Nelson was a powerful and effective editorial leader, one former Time Inc. editor said. "She could get into brand mentality and own it," said the former editor, who had worked closely with Ms. Nelson. "I was constantly impressed with her."

Although she helped merge the editorial print and digital teams at Time Inc., a current staffer said Ms. Nelson was ill-equipped to steer the company from analog to digital. "She was the definition of old media thinking," the staffer said.

Mr. Ripp and Mr. Pearlstine praised Ms. Nelson in a statement. "She has been a driving force for more than 20 years and has helped build some of our most vibrant brands," Mr. Ripp said.

The changes will not mean any erosion of the company's editorial standards, according to Mr. Ripp. "With the decentralization people might be concerned that we're losing our journalistic traditions," he said. "The very fact that Norm came here spoke volumes that it's not true. We are not only going to be respecting our traditions enormously, but setting the company to move forward. "

In other developments, the company said Lynne Biggar is joining Time Inc. from American Express as exec VP-consumer marketing. Lawrence Jacobs, a former News Corp. executive, is joining as exec-VP and general counsel. Maurice Edelson, who had held posts including general counsel and helped lead the company during a period of CEO turnover, is leaving for Time Warner.