Six Key Success Factors for a multi-dimensional approach
1. Anchorage to the top
- Internal sponsoring means relentlessly recalling the importance of the Key Account program (through website, newsletter, etc.), mentioning quantitative or qualitative evidence of its success, putting in place an Executive Sponsor program, and organizing internal events such as Key Account conventions and/or awards. It could more simply be organizing specific competitive steering committees for evaluating the investment projects for different key accounts.
- Outside sponsoring could lead to significant participation in end-of-year negotiations for example, or setting up an Advisory Committee with a selection of key accounts.
2. Attention given to business quality rather than business quantity
- A business built only on maximizing quantities sold can more easily be copied.
- This means that Key Account Managers must focus on differentiated business.
- Eventually, it means that their incentive schemes must be more and more aligned with some form of quality or profitability.
3. Openness to training needs
- Our experience shows that whenever we are directly invited to train current or potential Key Account Managers, soon comes a time when the organzation' progress requires a training operation (which does not preclue a different training approach) for top management, and even very often a consulting operation on internal reorganization.
- Then only can the Key Account orientation show its incredible potential!
4. Customer relationship orchestration rituals
The interaction with key accounts is by nature of the relational type, as opposed to transactional. This means that something mut go on at any time in the relationship, and it is widely known that you have more chances to decipher interesting business when you are not under short term negotiation pressure than otherwise.
- It is the Key Account Manager's responsibility to orchestrate this relationship over time. This can be done through multiple types of activities, some internal such as "sales funnel meetings", regular "operating meetings", others external such as business reviews with the customers or a "customer advisory board" (see above).
- However, ideally the form of these rituals should be validated by the Key Account Director.
5. Perform and apply Key Account segmentation
- Although it is a rigorous process, segmenting the portfolio per se (i.e. partitioning it) is not difficult. What is much more difficult is defining the rules monitoring the variations in resources and relationship management.
- However, when this is properly done, the resource allocation gets aligned with customers' potential, thus leading to more economic performance.
6. Internal competitive process for budget approval
- In this case, many organizations follow at best arbitrary rules for attributing these budgets and project teams, hence joining our likely "time waster" population.
- Others set up "Steering Commitees" at the Global or Regional levels in order to secure objective selection and optimal alignment with corpoate strategy. This in itself is often enough to explain success in Key Account Management.