√ New Year √ New Plan ? New Pain
It is the end of the year, and before we can enjoy the Christmas bonus and stuffed turkey, Key Account Management professionals have the unenviable task of reviewing the past year and creating account plans for 2017. You have probably been doing it every year, so you have a basis or a template, and all you need to do is update that, add projections, etc. But is it that simple? It is not just a sales projection; it is an account plan. We can think of dozens of questions you need to answer while planning for a key account and you can probably add on to the list as well. So where and how do you begin? Before you dig out last year’s account plan formats, the old ppts or excel sheets ask yourself these questions; “How are KAM professionals in competitor organizations and other industries preparing their account plans? Is my old method the best, most efficient way? Is there a way to make account planning easier, or to create a more thorough, robust account plan?” If you have paused to think about these questions, your first step has been in the right direction! Our experience providing KAM technology for IT service industry clients has shown us that they face challenges that are often uniquely different from those faced by other B2B industries. As we examine these challenges, we reflect on how they affect account management and how technology can ease the pain and assist with account planning. Service, an Intangible Product Organizations that have a tangible product can easily demonstrate and communicate the uses and benefits of the product. Therefore they depend primarily on the product quality and back that up or accentuate it with a brand. In contrast, the service industry has an intangible product whose benefits are not as easily demonstrable. Therefore trust or a brand name and depending on relationships and people is what attracts and retains customers. One of the benefits of KAM technology is its ability to calculate the relationships mapping strength of key accounts. Another is the convenience of having a unified view of organizational hierarchy, showing all people related to the key account, in the client’s firm and yours. Making an account plan is easy if you use all the relationship related features offered by technology; use CRM as a base, drag and drop to create a key account’s organizational hierarchy, assign a status to people based on their affinity for your company and services, plan periodic interactions between people from different hierarchical levels and more. The result, #painfreeaccountplanning, and the confidence that it provides metrics on relationship strength and throws up warning indicators as well. This year you can use specialized key account management technology to create a well-articulated account plan, one that converts relationships from hurdles into the backbone and strength of marketing. Interaction between the buyer and seller Research by Rawson, Duncan, and Jones found that customers of service industries judged satisfaction based on cumulative experiences across multiple touchpoints. In other words, each time the customer interacts with you, be it the receptionist at your head office, the automated caller menu and every client service assistant and manager, he or she is judging the experience and consciously or unconsciously rating his or her experience. A product has only one or at best a few touchpoints between the seller and the buyer. On the other hand, providing a service has multiple touchpoints throughout the life cycle of the service contract. Therefore more white space opportunities to delight or disgust the customer! Knowing this, who wouldn’t want to track customer interactions in a systematic and objective way? The solution- use KAM technology to collaborate with internal stakeholders, enumerate mutually agreed expectations and targets, and create a unified action plan. This is your chance to plan systematically and make each touchpoint an opportunity to delight your strategic account management. Make or Buy Conundrum In keeping with the holiday season, imagine you are a manufacturer of chocolates who finds he has the insufficient inventory to meet demand. Would you think of buying a cocoa plantation to increase your raw material supply, or of manufacturing a machine to temper chocolate? Probably not. You are most likely to approach sellers and buy them outright, even if you had to increase production at the cost of lower margins. But what if an IT service provider approached you with software that could better estimate cyclic consumption and enable you to plan production and inventories such that you would not face seasonal crunches? Would you consider it right now, put it off till after the holiday season production rush, wonder if the investment would really pay off or think about whether you could do something similar in-house? If you said yes to either of the last two options, you have just highlighted the challenge of selling services. Services, particularly IT services, are rarely perceived as immediate requirements. Their investment-outcome ratio is endlessly debated and often an in-house, home-grown alternative is chosen. Can you overcome the make or buy conundrum? One way to do this is to sell solutions, not services. KAM technology enables you to systematically catalog client requirements, understand the client’s end goal and align your company’s products and services to offer solutions accordingly. While key account planning this year, you can use technology to create a whitespace analysis and depending on the results, design and offer the right solutions to a key account. Creating new avenues of business from an existing client not only adds to your revenue, but it also makes the client feel valued because you are proactive in helping them meet their end goal. Customized versus Standardized Products tend to have standard specifications. Any variations or customizations are generally made at the request of customers. Hence the cost of customization is relatively easy to calculate and is often passed on to the customer. But when you sell a service as a solution, not a product, you have to customize the service
Interview with Olivier Riviere – Consultant & Head of the KAM Practice at Invalio
Olivier tell us about your journey as a Key Account Management Professional and how do you help companies achieve growth through focusing on their strategic partnership with the key account? In the course of my career, from junior team member to Executive in charge of Key Clients, I have always been involved in the relationship with truly strategic customers across various industries: design and manufacturing, semiconductors, Entreprise Software and B2B Marketing & Communication Services. In addition, and I am grateful for this, my job also always included driving a true co-creation process with strategic customers and initiatives aiming at influencing the whole business ecosystem. When I became a consultant, I have quite naturally put these topics at the core of my activities. With my partners, we help companies of all size, analyze their strategic context, customer portfolio, and organizational dynamic in order to design and implement a KAM/GAM approach in line with their strategy, resources, and culture. I insist on working simultaneously on the KAM system AND the people involved in KAM; their skills, their motivation and how they collaborate and with their Customers. When is the right time for businesses to start looking at their client relationships in the more strategic manner? There are many reasons why companies should run a sharp analysis of the true value of each Customer and drive the engagement with selected Accounts more strategically. In theory, you can start at any time and the sooner, the better. As an example, start-ups operating in a B2B environment could take advantage of using KAM techniques upfront, although very few do it. In reality, for medium-size and large companies, the trigger situation for KAM comes from a combination of internal and external factors. The major internal factor is when the Executive Team realizes that KAM is a powerful instrument to accelerate the execution of the company’s strategy, whatever its specifics. The external factors are related to an evolution of the environment: market concentration, competitive threat, new regulation, or the need for more innovation. The trigger situation can also simply be the request of a few Customers to receive special treatment. All in all, it is the job of the Executive Team to assess when to start KAM, and it is an area where some external help can bring very high value. What are the biggest obstacles you see businesses face toward becoming more oriented toward servicing & acquiring a deeper understanding of their strategic accounts? The biggest obstacle is definitely the culture. Exploring the true value of each customer and categorising them accordingly, developing a deep sense of the real Customer Experience and where it matters to improve it, further developing the network of personal relationships with Key customers, all of this requires teamwork, collaboration, and the capacity to drive a sustained collective effort that cuts across disciplines and organisational boundaries. Most companies and not only large ones have difficulties to do this. When you look at why KAM initiatives fail to deliver on their promise, the lack of attention paid to cultural change is always part of the picture. Another frequent challenge is the lack of depth of the analysis of the Key Account organization and the network of relationship. The superficiality of the analysis prevents the vendor’s team from finding new angles to strengthen the ties with strategic customers. Software is eating the world & account management could not escape! Do you feel there is a need of having specialized platforms or software for strategic account management? The answer is definitely yes. CRM systems are currently not adapted for true KAM.and other tools are required. This being said there are different sort of needs that can be covered with an adequate software application. Account Planning and monitoring of execution Definition and management of the Value Proposition Opportunities & Share of Business Management Relationship & Influence Management Communication and Operations (team portal and customer portal) These 5 themes are quite differentiated although they do overlap. I am not sure that a single platform will be able to cover all these needs at the same level of depth and for all type of companies in the near future, but I do not see this as a big problem. Companies need to assess their needs and explore where they should consider adding one or several KAM specific tools to their existing software stack (or replacing old applications by new ones). Will such tech platforms become ‘a must have’ for account managers and their leadership or do you feel it constitutes ‘a nice to have’ capability? We are in a transition era. Commercially available Software tools for KAM are just emerging. I strongly believe that the trend will accelerate rapidly and that the benefits of such platforms will be increasingly recognized by more and more KAM and IT professionals. As the awareness of such tools, and probably the breadth of the offering, improve, KAM practitioners will have to avoid to reproduce the same deadly mistake as in CRM: namely putting the tool before the people. KAM software tools will bring value only if the KAM methodology and toolset used by a company are adequate and if the KAM teams – all people involved in KAM – are sufficiently skilled. Such needs are not covered by any piece of software but by Skills development through training, on-the-job coaching, and experience sharing and by a true focus on teamwork. What is your one mantra for growing strategic client relationships? Act like an entrepreneur. Be able to think and help others think out of the box and secure support for these new ideas. In addition, don’t be rebuffed by resistance and demonstrate patience. Would you like to share an interesting business book you have recently read and what was the key takeaway for you? I recommend “Give and Take, Why Helping Others drives our Success by Adam Grant”. One of my customer, Head of KAM in a German industrial company, has used this book to open the eyes of his colleagues
How Many Key Account Managers in the World?
If you are into Key Account Management (KAM), this question would have probably crossed your mind? Originating from finding a solution to retaining Key customers to long-term relationship building to a full-fledged Key Account Management practice, KAM has become a vital ritual for organizations. With KAM, Organizations have recognized the need to ring-fence 80% of their revenue and more. We turned to LinkedIn to drum up the global population of key account managers. It stands at 306,000.Isn’t that quite a number? And if we further categorize the data by, Country Gender Age group We find some interesting data points. With data in, can an infographic be far behind? In this article, we have put all the above data onto one very easily consumable infographic. Please check it out here. Did you find anything interesting in the above infographic? The numbers from Germany and Switzerland definitely deserve a second look. It seems probable that there are job titles that contain ‘Key Accounts’ but are distinct from our conventional definition of Key Account Management. Possibly. What about the age group? Are younger professionals taking a greater interest in an account management career or is it just a function of the talent management approach for KAM organizations? I am interested in knowing your views. The data onto the above infographic were sourced from the LinkedIn Ad management tool. Within the tool, the DemandFarm team used the ‘Job Title’ parameter to determine the numbers. If you like what you see, do not hesitate to share it with the world. Explore the complete guide to Cross-selling and Up-selling to identify unexplored opportunities for your business as well as your clients’ business and grow better in 2021.
Demand Farming – Co-creating Customer Value
Many organizations are late in waking up to the value of a Strategic Account Management program. If you were to look at trends in the lead to deal funnel, Account Managers are predominantly talking about how data is not easily accessible or is not leveraged fully or effectively, there is a sustainability challenge in the process and therefore the results; how a formal Key Account Management process will boost results and how a software platform derived from best practices of KAM will help them. Reproducing here, some trends from DemandFarm Inc.’s report on ‘The Hype & Art of KAM’. Industry reports state that about 60% of organizations lose deals because competitors establish a better relationship with the customer. 50% of companies use the attribute “strategic fit” to select their key accounts, followed by 27% using “past/current revenue” for key/strategic account selection. 8 % of respondents identified access to customer executives and decision-makers as the main KAM challenge. 60% of respondents from best-in-class enterprises feel that their biggest KAM challenge is the balancing of short-term sales goals with long-term CRM goals. 2% of organizations still do not have a formal key account management process. 50% of respondents say data about key accounts in their organization is fragmented and not easily accessible. 83% of respondents believe that KAM planning and strategizing will receive a huge boost, with the adoption of a KAM software platform. 60% of respondents feel a software platform derived from KAM best practices would be useful to them. 28% of respondents feel a built-in account planning process would significantly aid them in planning and optimizing revenue from key accounts. To address these challenges, it is important to learn about the different stages of the enterprise lifecycle, how clients and providers view their relationships, what a good client relationship is about as well as how it can impact your results. While doing this, it is integral to adopt one of the two processes – transactional or transformational. Sitting on the fence between the two could prove to be a hindrance in creating and maintaining a happy account. The presenter, Adrian Davis, President, Whetstone Inc. also takes you through the above, as well as Winner’s Quadrant, the Knowledge Funnel, and other important things. He also helps you discover and discuss effective features of SAM software such as Account Whitespace Analysis, Organization Chart with Heat Map Analysis that could tilt the scales in your favor. The session happens now at SAMA’s Annual Conference 2016. Here’s to customer value! To learn more, join the session by Adrian Davis at #SAMAAC16‘.
Setting Up A Key Account Management Process in 9 Steps – Part 1
The title may make it all sound easy, this process of setting up Key Account Management as a process in 9 easy steps, but you and we, both know it is not easy. However, the sooner begun, the better done. Let’s cut to the chase and start knocking out the 9 steps easy and quick. In this part I, we will look at the setting up part. In Part II, we will look at running and the review part. Portfolio vis-à-vis profits: Every business decision needs to be weighed and analyzed for its ability to make a profit. Similarly, the portfolio that will come under the purview of the KAM process needs to be precisely analyzed. You need to make sure that the business sectors, lines that you are in, are deliberately chosen; you need to know why they are chosen and whether they are there for their profit-making capabilities. In business, there is no room for happenstance or chance. Every decision has to be a deliberate one. Understanding the customer in-depth: Dissecting the customer on a whiteboard is a good idea. This will help you know who your customers are? Who is good and who is bad? What makes them so? What are their needs – specify them? What are their loves and pet peeves – professionally and in terms of your products? How much are they worth to your business? Detail their behavior patterns when they make key decisions regarding your product or category- new buys, renewals, moving to a competitor? Why do customers buy from you? What are their deepest fears, issues, and challenges? Remember, God is in the details! Relationship X-ray: A relationship scan is always good to maintain the health of the relationship or improve it. What insights has the relationship mapping of your key accounts provided? How is it seen within your department and within the organization? Do you have the right talent mix within your team to service these customers? Can you accurately or at least closely put a number on the longevity of the relationship, are you aware of the issues involved and the history? How are your key accounts distributed percentage-wise, in your total share? Do you have data and insights on possible opportunities for developing more business? Draw up a Key Account plan blueprint: This blueprint should clearly state the main direction, opportunities, and priorities for each Key Account. It should have a direct link to customer information and should be built as a collaborative effort between internal and external stakeholders. This should then be made available and accessible to all involved in the account. It is a good idea to check if you have had the customer involved and if he has been cued into this plan. You will also need to be clear which information is important and which is not; and also be clear about the source of this information and the source of having it regularly updated and in real time if possible. In the next part, Part II, we will see how to run and review the KAM process. See you soon!
How to Effectively Drive Prospect Engagement
You may have a strategy to make a sale, but what about the period after the sale? Keeping clients engaged after a sale is made is equally important as it is the window to future opportunities. Engaging with prospective customers assumes another level of significance as they are half convinced and might need a slight push to bring them on to your side. Driving this engagement demands the creation of a winning strategy that requires careful planning and execution. Here are a few tips that can help you drive engagement and help nurture your leads: Form a bond It always helps to form a bond with prospective customers to get an insight into their thinking. Be transparent about the information prospects seek, as they will then find it easy to establish faith and confidence in your business. Try and thoroughly understand their needs and expectations. Then highlight the features of your product or service and tell them how it will be beneficial in solving their problem. Once you have made them comfortable and familiar with your business, making the sale will be relatively easy. Think long term Making a sale is not considered a short-term goal anymore. It extends beyond forming a long-term relationship where clients look to you for effective and quick after-sales services. By showing that you care even about a sale is made, clients will likely return to you for their next requirement or recommend you to their contacts. Nurturing leads should thus be a top priority in your strategy that should not be compromised at any cost. Get the questions right Asking the right questions will not only help you devise a successful strategy but also go to show your prospects that you have done your homework and are serious about your offerings. Garnering details about their budget, objectives, challenges, and goals will help you recommend a well-suited solution for them. That way, you stand a chance to not just meet but exceed expectations. However, avoid questions that make prospects uncomfortable, or make them question your credibility and capabilities. Avoid language that sounds manipulative or high-handed. Devise a successful strategy You need to keep your prospects engaged at all costs. This can be achieved by devising a sales effectiveness strategy that focuses on establishing credibility, showcasing thought leadership traits, and displaying where you score over competitors. However, it is important to avoid sounding pompous. Highlight how a client stands to gain from your products and services and back it up with some case studies or testimonials of satisfied clients. Also, always show your prospects that you are open to feedback at any stage. Ensure that communication lines are always open and that emails and queries through other channels are addressed at the earliest. In account-based selling such as this, making the sale is does not complete the job. Keeping engagement alive with clients and even with prospective clients, as they demonstrate the intent of positive action in the future becomes essential. Always remember to nurture the lead as this helps form a lasting bond that could translate to bigger rewards in the future.
