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How does your team strategically serve Key Accounts? Who is in charge of managing the account and driving sales and profits? The person who opened the account years ago? Does the local territory salesperson manage your key accounts? An independent sales representative firm? Or have you brought your large key customers in-house and you manage them internally? Another question we need to consider when solving the puzzle of key account development plans is: what are characteristics of a key account manager and what should the support team look like to give your company the maximum return from your key account development plan?

We have already determined why it is beneficial to have Account Development Plans.

We also discussed how to determine if account matches your companies’ ideal customer profile.

The next step in solving this puzzle was defining what a key strategic account is for your organization.

Now we need to assign the account to a key account manager and a team to insure this account achieves the desired profitable growth outcomes your company needs.

We often see sales problems when companies have the person who opened the account or the local territory salesperson manage key strategic accounts and their key account management plans.

Why?

The salesperson that opened the key account is a hunter; it’s what they do. They understand how to identify accounts that have a high probability of becoming customers and they know how to prospect, identify needs, and win the business. There are three reasons I have experienced why you don’t want your hunter managing a key strategic account.

1. The skills set to manage and grow an account are different than those to open new accounts.
2. Opportunity cost; your hunter has proven themselves very valuable doing what most salespeople struggle to do: identify, prospect and open new profitable business. Why burden them with account management when they could be using their time and skills opening additional key future accounts?
3. You want someone who will live and breathe this account, strategically start new relationships and identify new opportunities that may not have a return on their time invested for years. Sales Hunters have what is called a “High Utilitarian Trait”. What it means is the way they are wired they are willing to take on difficult tasks if they see a personal benefit quickly.

For all those fellow hunters out there I can hear your “ Ya Buts’”.

Ya but what’s the incentive for me to hunt and land whale accounts if you will take them away from me?

 Ya but I have built the relationship that opened this account.

 Ya but no one knows this account like I do.

 Ya but no one has the relationship with the key decision maker like I do

 And the big one..

 Ya but how’s this going to work in my goal plan and compensation?

All of these concerns and more can be strategically addressed proactively with the right expectations, compensation plan and account transition plan.

What about having the local territory salesperson manage the account?

Again the reasons they are not the ideal team members to manage key strategic accounts is very similar.

1. The skills set to manage and grow an account are different than those to manage and grow a territory.
2. Opportunity cost; your territory salesperson has proven them very valuable working with their distributors and growing their overall area of responsibility. They are gifted at keeping many spinning plates spinning while meeting and often exceeding their territory growth objectives. Why burden them with account management when they could be using their time and skills growing their territory?
3. You want someone who will live and breathe this account, strategically start new relationships and identify new opportunities that may not have a return on their time invested for years. They will build and leverage relationships to create a powerful relationship matrix in this account. A territory salesperson does not have that kind of time.
4. Key account managers have a much longer time horizon. Sales hunters and territory salespeople are focused (as you want them to be) on driving sales this week, month, quarter.

What does a key account manager look like?

What are some common skills and traits that I have seen key account managers have to drive the maximum results?

• Project management skills and or training
• Deeper product technical understanding
• Has professionalism, presence, and confidence to meet with buyers and other decision makers as well as the C-suite team
• Skilled at building and leveraging relationships within the account and with your subject mater experts internally
• Strong networking skills and today they includes social selling
• Strong financial understanding and business acumen
• Understands SPIN selling and demonstrates its use frequently
• Understands and can teach customers how to work with your company
• Someone with high EQ and situational awareness
• Customer focused approach / customer centric
• Often acts as champion for the customer inside your organization
• Understanding of your products and services and the value they provide, as well as the operations of your business and how to navigate known constraints
• If you are familiar with Social Styles like DISC, this person would be a DC style but have their placement near the center of the chart to easily move in and out of styles as needed
• Strong computer skills, ability to navigate your company systems and the customers
• Social with strong customer entertaining skills
• Strong communicator with your team, globally as well as the customers team globally
• Strong negotiation skills
• Strong competitive analysis capabilities and knows how to strategically differentiate your products and services
• Its how they sell as well as what they sell that sets them apart
• Team members of the key account often see them as one of their team and a trusted advisor

If a “hunter” opened this account think of your key account manager as a “gentleman farmer ‘ always working to maximize the return on investment from this account and aggressively looking for new field to plant.

Inside your organization you will want to develop your cross-functional team and establish cross-functional goals to tear down any silo’s that may exist.

Common members I have seen as a part of the Key Account Management team include:

Customer service

Sales support

Data analytics

Marketing/Product Management

Someone from pricing team

A representative from quality

A representative from engineering

A representative from operations

A representative from accounts receivables

Now I hear the company CEO’s and Presidents saying; “ We can’t afford that kind of overhead and still be competitive!”

You can create the cross functional teams to support key account sales because some of the team will be dedicated just to this account but many of the support members are not dedicated exclusively to the key account.

Who manages your key accounts?

 Do they also have other accounts?

 Do they manage a region or other salespeople?

 Is the person driving the growth at your key accounts the salespeople who opened them?

 What skill sets has your team determined a key account manager needs to have to be successful in your business?

 To insure you solve your key account sales problems you must have the right key account manager and a cross-functional support team.

In the next post we will discuss creating an account profile and completing a needs assessment.

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:

1. Strategic planning and budgeting are both essential but they are not the same
2. Strategy amplifies the voices from the front lines and customers
3. Resource allocation is purposefully undemocratic
4. Don’t let the earth’s rotation around the sun determine when you make decisions
5. 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 

 Discussed how to define what a key strategic account is

 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

Articles

Strategic planning training

Basics of strategic planning 

7 Elements of a strategic plan

Strategic account planning 

5 important elements of a strategic account plan 

6 account management best practices 

What is strategic account planning

10-step guide: creating strategic account plans

 

Books

 Essential Account Planning

7 Keys to Managing Strategic Accounts 

Pocket Guide to Account Planning 

Readings in Account Planning 

Connecting to the Heart of Strategy 

 

You Tube

Strategic Account Planning

Art and Science of Account Planning

Quick and Effective Account Planning 

 

Association

Strategic Account Management Association

 

In my last post we discussed conducting a needs assessment with your large key strategic accounts. In this post we will discuss more information we must have to truly design strategic account development plans that create sales velocity.

What do you really know about your key customers? No… really?

Far too often the relationship we have with large accounts is about “getting”. We need to get what we want from the customer just like every other supplier. To truly create repeatable profitable sales growth with key accounts today that lasts well into the future our relationship needs to evolve to be focused about “growing together”. Your key account development managers must evolve in your customer’s eyes from “ just another sales rep” to a “trusted advisor” providing much needed insights to help key accounts achieve their strategic bottom line objectives. In this post we will share how critical it is to take a SWOT at your large key accounts at least once per year.

What does your team really know about your key customers?

Ok, so they know your total sales and how those sales are broken out into painful detail by part. They know how sales have been trending. They know the buyer and maybe a few other key influencers. They know the history of your company serving this account and they should know what the customer requires for you to be seen as a preferred vendor.

 Lets ask a few more questions if you don’t mind….

What is your key account’s biggest strength?

 

What is your key account’s biggest weakness?

 What opportunities can your key account capitalize on this year?

 What is the biggest threat to your key account’s business this year?

 For teams to develop key account growth strategies they must intimately know the answers to these questions when they develop their account growth strategic plans. When you cater your growth plan to capitalize on market opportunities for your customers and fix unresolved problems they have you become a trusted strategic business partner and not just another vendor. Could a lack of current market data be hurting you sales performance?

 Does this sound like too much work?

 Does your team consider these questions each year?

 Not sold yet?

 Let me share an example of how one team I helped levered taking a SWOT at a key account and it turned into dominating a market niche at high gross profit margins.

 One of the teams I served in the past made custom bent tubes and pipe. We identified a new market: Tanker Truck Manufacturers because it matched the criteria for an ideal customer profile. Each of the large 31 tanker truck manufacturers in North America currently had bent tube vendors or they fabricated them themselves.

We leveraged our relationships at a local large manufacture of tanker trucks , met with their leaders and set out to learn about the business of their business.

What were this large key account’s strengths?

In speaking with their customers (fleet owners) in VOC interviews we heard they made a high quality tanker truck. They were not the cheapest but their trucks lasted about 30%-40% longer than the other cheaper models and had much less downtime. Fleet owners valued their service and relationship as well as their aftermarket capabilities. Even the fleet drivers preferred their trucks!

What were their weaknesses?

 Like many family run businesses that explode into large organizations they continued to manufacture as they always have. If it isn’t broke don’t fix it right? They had not leveraged LEAN yet and there were a number of opportunities to drive cost and time out of their manufacturing processes from our observations.

What were their market opportunities?

 We asked a lot of questions and did market research on their large fleet customers. At the time the fracking market was booming and we discovered each fracking job site received on average 8,400 truckloads of something each year. For example in the fracking process they require very fine fracking sand and some of our targeted customer’s trucks were hauling frack sand and other chemicals to fracking well sites. The trouble was all tanker manufactures were so busy they their production was often sold out for 12 to 18 months. If one of their lifetime loyal key fleet customers came to them with a much-needed new order they could not provide the same turnaround the customers were accustomed to.

What were their market threats?

 If you could not keep up with your key fleet customers needs for trucks you were forcing them to start relationships with your competitors who often made less expensive trucks. Once they started buying from them your gross profit margins often eroded on future orders because the salespeople were not trained to sell based on value.

Our key account could make large capital investments to grow their production capabilities but there was a huge risk in doing so due to the cyclicality in the price of oil per barrel. We found when oil was over $78 / barrel the fracking sights were booming and when the price dropped the wells were caped.

Each of the large tanker truck manufacturers were buying custom bent tubing in pieces and welding them together to make their tanker trucks. It would often take 32 welds and expensive heavy clamps to make one taker truck. It was a real art form to watch the welders fabricate the tubes on taker trucks. If the customers were not buying custom bent tubes they invested in a tube bender and were making their own very basic parts.

The company I was helping was known for making high quality custom bent tubing and their added value engineering capabilities. They built the engineering and manufacturing capabilities to make some innovative parts that previously would have needed to be welded or clamped together. Their parts were used in many other markets to improve performance and reduce labor cost and time of assembly.

So we developed a key strategic account development plan based on a few sales hypothesis what if’s:

What if we could look at our customers designed that currently included over 30 welds and numerous heavy expensive clamps and design custom bent tubes that removed the need for welds and clamps?

What if we shipped our parts in a kit and helped our customers standardize their designs?

What if our kits would move down the production line as the tanker truck was being assembled reducing assembly time, searching for parts and scrap?

What if welders that were in high demand could move to more value added parts of the assembly process?

What if the customer could reduce the number of heavy Victaulic clamps, reduce weight and the fleets could haul more fuel in my customer’s trucks than the competitor’s. (now that’s a competitive advantage! Every pound of weight we could remove resulted in the fleet being able to haul 7 more gallons of billable fuel!)

What if our designs and kits helped increase the number of trucks our customer could produce by week?

We used all of the above and more and presented our value-based solution to the leaders of this company and converted the majority of their orders to us.

Word spread in this fragmented niche market and we were asked to share what we did at the TTMA trade show. I had 9 minutes; (I will never forget that, toughest presentation I ever had to make), 9 minutes in front of the owners and executives of all the tanker truck manufactures in North America to share how we helped create value :

• Increase production
• Reduce weight
• Improve quality
• Reduce manufacturing costs
• Reduce scrap
• Better utilize welders that were in short supply

 Within months executive teams from the top tanker manufacturers were touring our facility. On those tours they saw our capabilities and that triggered other unresolved problems they had which resulted in more new products.

How about your company?

 Are you just another vendor or a trusted advisor providing insights to help your customers grow?

 How often do your key account managers take a SWOT at their accounts?

 Do your key account managers know the business of your customer’s business?

 Do your key account managers clearly understand challenges your large accounts face today and how you may be able to serve them?

Are your key account mangers seen as vendors or trusted advisors that impact the customers bottom line?

Would your team value explosive key account growth at higher gross profit margins?

Taking a SWOT at your key strategic accounts is a key step in solving the puzzle of key account strategic development plans that drive sales velocity.

To fix key account sales growth problems we must understand our customers’ business.

If you would like to learn more about SWOT Analysis please visit the sites below:

Airtable

Mind tools 

LivePLan 

Business News Daily 

Bplans 

The next step in the puzzle of fixing sales problems at key strategic accounts is taking a SWOT at competitors that share your key accounts and we will discuss this step in the next post.

In my last post we discussed why it is important to take a SWOT at your key accounts and understand the business of their business as we build key account strategic growth plans. To be seen as a trusted advisor who continues to deliver industry insights we need to do our homework. How much do you know about your competitors that share your key accounts? In this post we will discuss why we need to take a SWOT at your competitors as well.

As I have shared in past posts I have served many teams over the past 35 years helping them identify and fix sales problems. Each team had it’s own strengths and weaknesses and they all taught me a great deal about new interesting markets, business models and various channels to go to market. In each assignment we conducted voice of the customer research to insure we clearly understood what our customers wanted and needed today. We discovered the buying process and the buying criteria their buyers and decision influencers required to make a buying decision today.

I hope you are sitting down for what I need to ask you next….

What do you really know about your competitors?

 What are their strengths?

 What are their weaknesses?

 What are their opportunities for growth based on their distinctive competencies?

 What threats could negatively impact them?

 “Learning and talking about competitors is like talking about fight club and no one talks about fight club…and it’s wrong.”

• Mark Allen Roberts

 Why is this the case?

How can we strategically build sales growth plans at our large key strategic accounts if we do not objectively understand the competitive landscape?

There was one common trait that caused many of the teams who hired me that had sales problems and needed my services: Hubris.

Hubris: “describes a personality quality of extreme or foolish pride or dangerous overconfidence,^[1] often in combination with (or synonymous with) arrogance”

When I have agreed to help  teams I meet with their senior leaders and I ask questions about their business and their competitors. Maybe its because sales is a full contact sport, or maybe it is wishful thinking, or even a dated view…but often senior teams say things like the following about their competitors:

“They suck! …Their service is terrible and they give their products away…”

 “Our company is the Best…”

 “We are the most Innovative in our industry…”

 “We are the leader in our industry…”

 “We are the only one in our market who can _______”

 “We have the best quality…”

 “We have the best people…”

 “We have the most robust processes…”

 If you were in my shoes at this point, what is the problem?

If you said: “they did not answer your question” … you would be correct.

Even if everything they shared above were true it does not help me shape a sales strategy to beat the competition at their key strategic accounts.

Now don’t get me wrong in many cases there was a time, years ago, their company was probably the dominant player in their market but the trouble is the competitors have caught up and they never adjusted their strategy. Think about how much has changed in the last 10 years. They are executing a strategy today based on an outdated information and it should not surprise us that less than 60% of the sales team achieved sales growth goals last year…again.

So once again, now that we got that out of your system….

What do you know about your competitors that share each of your key accounts?

 When I provided consulting services back then I had no emotion for my client’s competitors. I had no political worries if I shared something that might make the owners and or the board uncomfortable. I had one CEO say: “Wow you really break glass don’t you? You just throw it all on the table?”

Yes, and the good news is your company would not have lasted this long if you did not have smart dedicated team members and good processes, so what do you say we feed your team facts of today and let them shine building strategic sales plans?

Many times after conducting voice of the customer work I had to share good things customers shared with me as well as throw the skunk on the table and share problems their customers had with how they did business.

In one such discussion I asked the son of the founder, who just shared how much the market leader in their industry , his competitor, sucked…

Does your competitor really suck? (It was like someone sucked all the air out of the boardroom or it was like I told him his baby was ugly) Everyone in the room was looking at me in disbelief. Senior managers were looking at each other uncomfortably and waiting for the ball to drop. What was interesting was his father the founder had a bit of a smile.

So I asked a few questions based on my market work…

If your competitor is so bad …please answer a few why questions for me….

Why are their sales 3 ½ times your sales?

 Why has their EBIT as a % of sales grown 2.25 % in the last 2 years and yours dropped 3%?

 Why did they just win an award for another innovative new product?

 Why did they successfully launch into a new market 3 years ago you do not sell into and they now are the dominant supplier?

 Competitors also have negative issues and we need to bring everything out into the light of day to truly develop key account strategic growth plans that create sales velocity.

All politically driven emotions aside please answer the following questions honestly…

What are your competitors value propositions?

What markets do they serve?

Are they particularly strong in one market or another?

In the markets they are strong in …tell me about the gross margin. Is it high or low?

How cyclical are their key markets?

What are they really good at?

Where have your customers told you they struggle?

Based on analysis you have done, where are they vulnerable?

What is their biggest threat?

What do we know about their sales for the last 3-5 years?

What do we know about their profitability over the last 3 years?

Have they made any strategic acquisitions in the last 5 years and how to they fit with their other products?

What have they shared on their website and in their shareholder reports we need to know?

In the accounts you share, why does the account buy what they do from the competitor and not you?

In the accounts we share why does the customer buy what they do from us and not them?

What has your key account shared your competitor does very well?

Is there anything your key account wishes your competitor would start doing or stop doing?Have you bought your competitor’s products and sent them to an outside third-party test lab and run side-by-side performance and durability testing? What were the results?

Where do your competitor’s products ship from? Near by, in the region, international?

How do they package their products?

How do they price their products?

How wide and deep is their product portfolio? Where are their product gaps?

Are there any patented proprietary parts they supply this account and they are leveraging?

What terms do they give your key account?

What industry certifications do they have and can they meet?

Does your competitor provide training, research and development, and or other services? If so what are they? Are they free or is there a fee?

How long has your competitor sold your key account?

What % of the customer’s buying dollars does your competitor have? Is it growing or declining in the last three years and why?

How would you rate their key account manager’s relationships in this account? Shallow or wide and deep?

Does she have relationships with all the key decision makers or just the buyer?

Has she worked her way up to the C-suite? If so how did she do it?

Once you take an objective SWOT at your competitors your team will be able to build a strategic plan based on current facts that drives sales velocity and provides tremendous value to your customers.

So how you doing?…

Leaders I have served with high emotional intelligence and are focused more on winning, increasing shareholder value and becoming the dominant market leader  love having these discussions and learning about their competitors. They enjoy building key strategic account development plans based on current facts not politically corrected dated beliefs.

Leaders who have the ability to objectively review competitor strengths and weaknesses based on data and voice of the customer research create plans that drive profitable sales growth and create sales velocity for years to come.

If you are feeling uncomfortable why do you think that is?

I had one president share in one of my sessions: “You make me feel uncomfortable, you are asking things we should know but we don’t. It makes me wonder how effective any of our sales strategies are ,,,”GOOD!

 

Today is a new day and we can gather what we need and help your team win!

If you really believe all your competitors suck then I promise you your salespeople are struggling, you are loosing orders you should have won because your salespeople  are selling naked. They lack an understanding of how to strategically leverage your distinction and beat the competitors. Your salespeople are using a dated sales process. The market today is not about working harder, its about making a smarter plan based on today’s realities .

Please have your team conduct competitive analysis and take a SWOT at your competitors.

In our next post we will discuss how to use the information you have gathered to design a key account strategic growth plan that results in explosive profitable growth for both your customer and your company.If you would like to learn more about competitive analysis (after you cool down) please visit the below websites.

How to do Competitive Analysis 

57 questions to ask in competitive analysis

8 steps to Competitive Analysis

Harvard: Mapping your competitive position

Social Media competitive analysis 

Track your competitors with Klue