Davies was previously joint CEO of CRM software firm Sword Group.

Alterian has also appointed Phil Cartmell, the current executive chairman of the technology group Corac, as non-executive chairman.

Cartmell replaces Keith Hamill, who had to delay his retirement after Eldridge’s departure to lead the search for a replacement.

Both Davies and Cartmell take up their positions on 5 September but join the company’s board from tomorrow.

Davies said: “I am looking forward to working with the management team to realise Alterian’s full potential. There are a number of challenges to overcome in transforming the business but the strength of the company’s people, products and clients underpin my confidence of being able to achieve a good recovery over the next few years.”

Alterian’s annual results for the 2010-11 period showed revenue down £1m to £37m and an operating loss of £4.4m. At the time Hamill explained the poor results were due to “an increase in costs aimed at expanding the business” that were “not matched by growth in revenues, which were substantially below plan”.