CRN Interview: Jim Lewandowski, McAfee

Within a month, Network Associates was renamed McAfee, the company launched a new three-tier channel program and its North American channel chief, Donna Troy, resigned. Despite all the transitions, Jim Lewandowski, McAfee executive vice president for North America sales, said the company remains committed to building a channel-centric sales model. Lewandowski highlighted recent changes to McAfee's channel model and the potential benefits for partners in an interview with CRN Editor in Chief Michael Vizard.

CRN: What impact will the resignation of Donna Troy have?

LEWANDOWSKI: If you think back, Donna and I started here together about a week apart. We've worked very closely building the direction and the plan for the company. The fact that Donna is leaving is regretful. We would prefer that she didn't. But that said, there isn't much of a difference in terms of the strategy that we've put together. While Donna was leading the execution of the strategy, we were very closely linked in terms of how our field teams worked with partners and what the strategy is for our partners. We don't have any core differences in opinions in terms of where we are going. It just means that a different person will execute the strategy that we have for North America. And having somebody else execute the plan in North America was already in the plan because Donna was next going to focus on building a global channel. Kevin Weiss runs all our worldwide field operations. He will replace Donna with a global channels executive who will continue to build the program. And we will also have a North American channel executive who will report to that person. Even if Donna had remained here, we still would have had a search on for a North American executive for three months now.

CRN: How will these changes affect partners?

LEWANDOWSKI: Any partner that we work with will have a channel manager that will report through to the channel executive for North America. The channel account manager will also link our direct-sales team with the partner's sales team. It's pretty traditional. The only difference is we're going to expand the number of channel account managers that we have. We're going to deepen the relationships with our partners. We will have fewer partners overall because we're driving our partners from a volume to a value continuum.

CRN: How many account managers are we talking about?

LEWANDOWSKI: It's a double-digit percentage more than we have now.

CRN: What are the core elements of the McAfee program?

LEWANDOWSKI: We've announced a three-tier partner program. We have Associate partners that have some basic interest in selling our products, but have not made a deep investment to differentiate us. There can be any number of Associate partners and we won't restrict the Associate partners. Then we have Premier partners that are another step deeper in their investment with us and then we have the Elite partners. For the Elite partners, we will be investing a lot more in terms of discounting, rebates and the MDF dollars that we spend with those folks. And we will try to focus in particular market segments with them. In the Premier and Elite categories, we would like to have as many partners as we can, but the fact of the matter is that there aren't that many willing to make the investment. Initially, you will find people segmented between our intrusion-prevention products and our core McAfee offerings. The investment to sell IPS is very much greater. We're finding quite a few that want to make the investment in that, but there are also some that have to do quite a bit of work to make that level of investment.

CRN: What are you doing to help partners make that investment?

LEWANDOWSKI: We built some training courses online so the cost of getting people trained and certified is on us. From an equipment perspective, we have special programs so VARs can get our equipment in an affordable manner. We're also investing in our channel managers to help provide on-site assistance to train people and assist in skills transfer. And we're going to give them extra margins on the transaction themselves.

CRN: Why do you need to keep the certification levels around IPS high?

LEWANDOWSKI: We've been very stringent about the IPS market because our customers are demanding people that have a high degree of skills. Therefore, the certification requirements are much greater than they would be in antivirus. When you put a product in the core of a customer's network that looks at every transaction, it's a pretty high requirement from a skills perspective. We have to require partners to be at the right levels of skills, otherwise our customer is going to be disappointed. We're trying to help our partners get over the barrier in terms of bridging the skills gap.

CRN: What impact do you think Microsoft's efforts in the security space will have on price? Won't Microsoft drive prices and margins down?

LEWANDOWSKI: I don't necessarily agree that average selling price will fall. It's unlikely that Microsoft will participate across the entire security product spectrum anytime soon. It may happen in a certain segment such as desktop firewalls or antivirus products, but when you look at the network or server side, I don't see Microsoft participating in that kind of market. If anything, demand is growing beyond our capabilities to meet it right now.

CRN: Despite that demand, do you think there will be some sort of consolidation among the vendors in the security market as network, operating system and systems management companies continue to bundle security features into their products?

LEWANDOWSKI: What is driving the business are security threats, which used to come just in e-mail. Threats now come not only from e-mail, but [also through] worms and other threats to the network. There are many more angles today for the bad guys to breach security and the velocity of those threats is continuing to increase. So the vulnerabilities are expanding in addition to the number of ways that people interact with data. To say that all of this is going to be built into the fabric is hard to conceive over the next three- to five-year time frame. Will there be consolidation? Absolutely. But this not about an industry that goes away. I can't see that in any shape or form.

CRN: At the end of the day, how will you measure your success?

LEWANDOWSKI: We've got market-share goals in retail, consumer, small business and the enterprise. We also have revenue objectives on each one of those. And then there are customer satisfaction goals across each of the products. We'll measure customer satisfaction, revenue and profitability. For channel account managers, compensation is almost exclusively tied to partner satisfaction. People in the field services organization also have compensation tied to partner revenue targets. There can be times when the direct sales and the channel have conflicting compensation goals, but we have gone to great lengths to remove those barriers. And we don't hear this issue come up today. That's a big step for us because it's not where we were in the past. When I joined Network Associates, we did not enjoy a reputation as a company that understood the channel and how it should work. Now our partners are telling us that not only do we get it, but that we are committed to it. They're telling us they are excited about our partner relationship-management program that we will roll out later this year. They are excited about our configuration management tools. In general, the ease of doing business with us is improving rapidly. Let's face it. Good products in an expanding market don't always carry the day. It still comes down to execution with partners. Our results in the next six months will bear out whether that story holds together.