In most companies our key accounts contribute 70%- 80% of our revenues. Why wouldn’t we take the time to create strategic key account growth plans for each customer? In this post we will discuss how to put all the puzzle pieces you have gathered into a strategic account development plan that drives profitable sales growth today and well into the future.
I just read an article by Bain & Company and it asked an interesting question:
Is your strategic planning process a competitive advantage or a waste of time?
The article was about the strategic planning for your business, but it reminded me how often I have seen key account plans that were poor or at best just a budgeting exercise.
In this article they shared how they asked 300 global executives the above question and one out of three said their strategy met the three vital criteria of a good strategy:
- Bold Ambition
- Agile in the face of changing markets
- Concrete specific guidance for management and associates on the front lines
Few companies are achieving their sales growth plans each year and yet 60% of executives surveyed said they are satisfied with their strategic planning process.
My first blog posts was about: do you know what you don’t know?
In most of the accounts I served over the years they had very smart and talented teams of dedicated people. They delivered quality products and services. They intimately knew their product and service but often did not know what they did not know about strategic business development. Once we closed those gaps they realized explosive sales and profit growth.
From my observations over the last 35 years many leaders lack an understanding and a process to develop strategic plans that achieve sales and profit growth objectives.
Based on my past work I would argue one in ten companies truly understand how to develop and execute strategic account growth plans.
The good news is for those that do, they consistently produce profitable sales growth, have higher than industry average profit and higher perceived value by their shareholders.
The Bain & Company Article shared 5 key principles world-class companies incorporate:
- Strategic planning and budgeting are both essential but they are not the same
- Strategy amplifies the voices from the front lines and customers
- Resource allocation is purposefully undemocratic
- Don’t let the earth’s rotation around the sun determine when you make decisions
- Leaders focus on the most important decisions and simplify the rest
This is by far some of the best advice I have heard on the topic of strategic planning and it can and should be applied to key account strategic plans as well.
It’s time to review where we have been as we gathered the information we needed to develop a key account strategic plan.
We discussed why a strategic account plan is important
We determined how to pick accounts that need strategic growth plans
The support structure needed to drive results at key accounts
The importance of conducting a needs assessment
How to create key account profiles
We took a SWOT at our key account
We took a SWOT at our competitors that share our key account
Now it is time to put all the puzzle pieces from our market work into a strategic plan that will deliver value to our customer’s bottom line as well as our own.
A good strategic account development plan must have :
- Create a clear understandings of opportunities in this account
- Identify who you need to have a relationships with and a plan to build them
- Short term and long term goals and objectives
- Specific tactics you will follow to achieve each objective
- Determine what you will measure, how, and how often
- Present customer and gain their commitment
- Determine next steps plan for you and customer to achieve plan
To develop a strategy that drives the desired results at key accounts it always starts with answering the question:
How will this create value for the customer?
If your team cannot answer this question they are budgeting not creating a key account sales growth strategy. This is what most teams fail to have when creating strategic account growth plans. Poor plans are very clear on what you want and whom you plan to take it from. What they commonly lack is the “why” and how your plan adds value to the customer.
Based on your needs assessment and other research what is your targeted sales growth for this key account?
What were their sales over the last few years and how are they trending?
What should this account achieve if we did nothing new this year and just manage our products and service at this account?
Based on your history, current relationships and targeted new ones needed how long do you anticipate it will take for your plan to gain traction?
How will you measure your plan and when?
Next step is writing your strategic account development plan. It must be written and shared. Again I have worked with a number of salespeople who have a plan in their mind but never took the time to write and share their plan.
To execute your plan will it require investment? If so you must build a business case to win financial support for the investments. I have used the EVA model over the years but I am sure your company has a business case design process for making investments. What is critical is you identify the investments needed and their anticipated ROI, and by when.
It is critical your plan is designed to be agile. You will learn new information as you execute your plan and you must leverage this new data and adjust your plan to insure you achieve the desired results for your customer and your company.
As I have shared in prior posts most people do not do strategic work because it takes a lot of work as you can see. However when you do it will create sales velocity and improve your relationships with key accounts.
When you design and consistently deliver key account strategic plans that add dollars to your customer’s bottom line you are no longer a key account sales rep, you are now seen as a trusted advisor who delivers insight and value. Once you make this transition you are now invited to key internal meetings and projects at your key accounts. Your customers share issues they have not told anyone else. You are now in meetings with C-suite executives and hearing their needs.
Does your company have strategic key account development plans or account budgets?
Do your account development strategies start with how you will create value for your customer? Or your company and what you need?
Does your team have experience writing; executing and delivering strategic plans that achieve growth objectives?
This is my last post in this series discussing how to design strategic account growth plans.
If you would like to learn more I suggest the below links