HP's Gilroy Exits Channel For SMB

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It seems growing HP's worldwide SMB business takes precedence over bringing stability to its channel organization. In yet its latest shake-up, Kevin Gilroy has been promoted to the position of senior vice president of worldwide SMB segment operations.

Gilroy, who was VARBusiness' 2003 Channel Executive of the Year, is a 23-year HP veteran, 19 of which he has spent in the company's channel organization. Gilroy is replacing John Brennan, the former vice president of corporate strategy and development tapped last year by chairman and CEO Carly Fiorina to head up HP's Smart Office SMB initiative. Brennan has left HP to become senior vice president of corporate development at Adobe, where he will oversee strategic planning and mergers and acquisitions.

Clearly a major promotion for Gilroy in that it puts him in charge of a worldwide business unit, the move nonetheless adds uncertainty to HP's channel strategy. But Gilroy denies that his departure is bad news for the channel.

"I have a rock-solid team. I'm very proud of them. They will continue to execute like crazy," Gilroy says. "I don't think there's any need for rumination by our channel partners."

HP hasn't named a permanent replacement for Gilroy but has tapped Scott Anderson, vice president of partner operations and a former business manager.

"He's a very solid guy," says Gilroy's former boss, Mike Larson, senior vice president and general manager of HP's personal systems group in the Americas. "In a very short period of time, he has been doing great work in the operations area."

Larson would not say whether Anderson is a candidate to replace Gilroy, but says a search will take place both within HP and externally.

"Clearly, the kind of person we are looking to replace Kevin with is somebody who has a knowledge of the channel, can listen to the partners, understand the channel economics and understand how to be an advocate for the channel inside HP, which I think Kevin has done a superb job," Larson says.

While insisting that the move will have no impact on HP's channel strategy moving forward, the fact that Gilroy will be moving outside the company's Americas channel organization just two months after he was appointed to his current position has some channel partners concerned.

"This is certainly going to cause some channel jitters," says Dave Gilden, partner at Acuity Solutions in Tampa, Fla., whose biggest vendor is HP. "It's tough to say what the real effect of this will be because Gilroy has a solid team and operation on the channel side and it's not all dependent on one person."

Gilden notes that HP had made improvements with Gilroy in charge, but the company as a whole still has not realized the challenges its channel partners face in today's environment.

"They need to understand that it's hard to build a business on HP because you have to do a lot of volume to stay afloat, but a lot of their product is heavily commoditized," Gilden says. "HP is a good partner and they support us, but the bottom line is you have to sell a lot of product to get by."

Others were less rattled by the move.

"I don't think this is a gloom-and-doom kind of thing," says Don McDowell, vice president at Forsythe Solutions, which has partnerships with HP, as well as IBM, Sun Microsystems and EMC. "They have a strong layer beneath Kevin with Mike Coleman and Ken Archer. They are still very solid channel players with a lot of experience. I would expect this move will not put Kevin's plans at risk at all."

HP's quick appointment of Anderson as the acting head of channels is encouraging, McDowell adds. "HP has left plenty of holes in their org chart in the past, so at least they have someone there making decisions," he says.

Indeed, that is the message HP is hoping partners will take from what Larson describes as a good-news/bad-news situation.

"If I had my druthers, I'd keep Kevin where he is forever, but that [wouldn't be] fair to Kevin," Larson says.

HP officials say Gilroy will continue to work in the channel organization during the transition period. The officials also note that the majority of its channel business goes through the channels, and Gilroy intends to grow that business.

"The channel is a big play in SMB," Gilroy says. "There's a lot of challenges. There's a lot of work to be done in that area. It's exciting -- intellectually challenging. It plays to my career aspirations."

IDC analyst Janet Waxman says in the long run the channel could benefit from Gilroy's promotion.
"This is good for Kevin and it's good for the channel because they will have a strong voice representing the SMB which is where the growth is," she says.

Editor's note: How do you feel about Gilroy's promotion. Please drop us a line.

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