Lessons from Intel's 'Tylenol Moment'

Then on the eve of this momentous event comes news that four key channel managers and executives have simultaneously decided to accept the company's offer for early retirement or, in corporatespeak, an early separation package. The key executives responsible for running the entire organization are thousands of miles away and, it's safe to say, caught off-guard. What to tell partners? What to tell editors calling for comment or an explanation? Well, all of this drama unfolded in late March and came to a head last week at the annual Intel Solutions Summit in Las Vegas, where hundreds of partners gathered to hear about the company's microprocessor and product road map along with its plans for the channel. You just can't make this stuff up.

Vendors might underplay this, but partners get downright upset when executives with whom they have built long-lasting relationships suddenly leave. Why? Because of trust. VARs don't trust large corporations to do the right thing or protect their interests—they trust certain individuals who understand their business needs and put them before those of even the companies they work for. VARs get spooked because disruptions cost them money. New executives who arrive on the scene may do one or two painful things. The first is they may start making changes in the name of efficiency; the second is that important handoffs from their predecessors may get dropped. That's why many channel-centric organizations take such care when making partner personnel changes. Partners want to understand the new guy's or gal's philosophy and see if they have a strong backbone. In other words, will they fight for them when the going gets tough?

So, to be critical of Intel, it really did not handle the early retirement of Shirley Turner, Nick Davison, Mike Steward and an unnamed sales manager well. This was a "Tylenol Scare" moment, when Intel's PR machine and executives needed to get out in front of the news and manage the process minute by minute until things settled down. I am not trying to compare the horror of the Tylenol poisoning to the changing of Intel's channel, but in channel circles this was serious news—especially for a company that plays such a huge and critical role.

At a time when Intel's chief competitor, AMD, is making tremendous strides in the channel, Intel's message needs to be crisp and clear and its partners need to understand exactly where new executives stand on the major issues facing them.

Do you think Intel executives did a good job handling this channel crisis?
Everything Channel Senior Vice President and Editorial Director Robert C. DeMarzo is at [email protected].