1. Strategic Account Management: Concepts & Implementation for CEOs and Sr. Executives
1/12/2007
K. Krishnan

2. Account Management structure

3. Business Development Structure

4. Business Development Structure

5. Business Development Structure

6. Content Session overview Client needs assessment Account action plan
Session summary

7. What is strategic account management
A business strategy focused on a small number of important clients viewed as corporate assets with significant long term value
Solution orientation, revenue share maximization at requisite margin level and customer value creation are three most important objectives
Find ways to help both parties make and save money
The voice of the customer within your company

8. Basics of Strategic Account Management (SAM)
Selection of the right account :
High revenue
Complex solutions
Multi locations
High growth
High margin
Definition of the value proposition
Appropriate solutions
Value for money
Long term orientation

9. Basics of Strategic Account Management (SAM)
Conducting needs assessment
Current scenario
Future plans
Technology preferences
Identifying key influencers
Create account action plan
Account strategy
Solution strategy
Competition assessment
Pricing strategy

10. Basics of Strategic Account Management (SAM)
Present findings to the client
Deploy cross functional team
Implementation of plans
Summarized results for senior leadership for long term strategic decisions
Help both parties find ways to make and save money

11. SEM – Key Account Selling
Pre Account Management Selling:
One to One contact
Supplier presentation focus on their own issues and concerns
Response to customer enquiries is “ Yes” and “No” based on assumed customer needs and supplier capabilities
Seller seeks volume potential
Customer seeks evidence of competence and competitiveness
Customer will judge competitiveness based on price
Customer may require trial period
The buyer may act as “Goal keeper” and prevent access to other buyers

12. SEM – Key Account Selling
Early stage account management:
Principal contact is between two people – buyer and account manager
The relationship may be competitive – each seeking advantage
Discussions dominate:
Price
Supplier capability
Customer still assessing alternative supplier

13. SEM – Key Account Selling
Mid stage account management:
Principal contacts start to facilitate other contacts through mutual trust
Increased time spent in meeting
Increased trust and openness
Mishaps can occur crossing set backs
This is a lot of work for both buyer and seller

14. SEM – Key Account Selling
Partnership stage:
Information is shared
Relationship is based on trust
Access to people is facilitated
Clear vendor ratings and performance measures are in place
Value is sought through integrated business practices
Value is sought through focus on customer needs

15. SEM – Key Account Selling
Strategic stage
Joint R&D
Transparent costs and margins
Focus on innovation (blue ocean thinking)
Joint business plans
Collaborative approach to customers, new markets and end users
Shared communications
Shared training
Help both parties find ways to make and save money

16. Needs Assessment What is needs assessment
A survey guide that is used to interview and document client representatives
How can it be used
One – on – One with your clients: The questions are asked by the Account Manager with or without presales team member and documents the response given by the customer
How long does this process last:
At senior levels the interview should last about minutes, at the middle management level about 2 – 3 hours and at a working level could vary depending on depth to which data collection is involved

17. Needs Assessment How often is it used:
With all the top accounts, this is an ongoing process and is not time consuming since the additional information is incremental. However, in the case of a new client this could be a lengthy process
How does one deal with the data collected:
Proper documentation
Summarizing essence of finding
Developing strategic solutions
Sounding out customers
What are the advantages of this process:
Improved understanding of customer needs
Improved customer relationships
Increased knowledge within our organisation
Higher closure rates
Better proposals and solutions
Increased customer loyalty
Well defined voice of a customer

18. Needs Assessment How many organizations use a client needs assessment
Global – 60%
Indian – 20%
Most successful account managers do proper needs assessment and documentation. Though this is not a very “exciting” part of the account management process, it leads to much higher success rate

19. Needs Assessment – Client interview questions
Strategic:
What changes have occurred in your industry during the last two years
How have these changes impacted your organization
What changes are forecasted for your organisation during the next year
What are the top three priorities for your department in the next year

20. Needs Assessment – Client interview questions
Operation:
How does your current business work
Complete supply chain starting from vendor end to consumer end
What are the current processes (capture workflow with input documentation, action at each step in the process and reports)
Level of automation and technologies used
Current problems and gap areas
Impact prioritization

21. Preparation for meeting
Define the clear objectives and goals of the meeting
Do some preparatory work about the industry, client organisation from the web or other published documents
Try to find out about the individuals whom you are meeting
In case it is an existing client, find out about the current status including customer issues, resolutions etc.

22. Long term decisions Organizational strategy Planning process
Competitive assessment
New products and services
Deployment strategy

23. Automatic Red Flags
Missing critical information: This should be identified at the earliest and gaps plugged. Gaps in information can lead to incomplete and incorrect solutions thereby loosing the account
Uncertain about information
Un-contacted buyers
Buyer is new to position
Re-organization at the client company

24. Perception Is Reality
Response is determined by buyer’s perception of:
Immediate business situation
How will the proposal change that situation
Whether or not that change will make the desired impact
Is the change marginal and is there value for money
Perception of buyer alone is not sufficient. All the people involved in the process of decision making should be positively impacted

25. Response Modes Desired state Desired state Result Current state
Discrepancy
Reality

26. Growth Mode Result Discrepancy Reality Probability of action:
Vitals:
Perceives discrepancy
Receptive to change
Change to improve a good situation
Probability of action:
Very high
Trigger words:
More
Better
Faster
Growth
Improved
Clutch
Your proposal should be the change agent
Result
Discrepancy
Reality

27. Trouble Mode Result Discrepancy Reality Probability of action:
Vitals:
Perceives discrepancy
Receptive to change
Change to fix a bad situation
Probability of action:
Very high
Trigger:
Help – sense of urgency
Clutch
Proposal must be the change
that will quickly reduce
or eliminate the discrepancy
Result
Discrepancy
Reality

28. Neutral Mode Result Reality Probability of action: Triggers: Clutch
Vitals:
Perceives no discrepancy
Not receptive to change
Nothing to fix
Probability of action:
Medium / low
Triggers:
Don’t rock the boat
Clutch
Proposal is a threat unless
another buyer pressures
or you can demonstrate
discrepancy
Result
Reality

29. Reverse Mode Probability of action: Triggers: Clutch Vitals:
Doing better than anticipated
Not receptive to change
Nothing to fix
Probability of action:
Low
Triggers:
Never been better
Clutch
Proposal has negative impact
on reality
Reality
Result

30. Buyer Types
Economic buyer
User buyer
Technical buyer
Coach buyer

31. Economic buyer Position: Rubber stamp
Role: Gives final approval for buying
Controls money
Has veto power
Focus
Bottom line impact
Organizational impact
Asked for:
RoI
Impact on organization

32. User buyer Position: Tester
Role: Judge impact on products / services on his / her job performance:
Will use or supervise use of products / services
Link between user buyer’s success and the success of product and service
Focus
Task on hand
Asked for:
Performance improvement for self
Performance improvement for the department

33. Technical buyer Position: Gate keeper
Role: Measures quantifiable aspects of products/ services against specification
Can’t give final approval
Can advise against based on technicalities
Criteria used: Price, delivery schedule, logistics, terms & conditions, regulations, credit etc.
Focus
Not win but play
Asked for:
Does it meet requirement

34. Coach buyer Position: Friend Role: Acts as a guide for sale: Focus
Provide / interpret information about validity of single sales objective, other buyers, long term plans etc.
Focus
Your success with this objective
Asked for:
How can we ensure that this solution is accepted