Key account management is the strategic approach that companies take to manage and grow their most important customers. In other words, the ultimate purpose of key account management is to develop long-term, mutually beneficial relationships with the specific business to meet strategic goals and optimize the value in both companies.
This requires taking concentrated, strategic, and holistic efforts that start with understanding both customers’ need for products as well as services and how customers want to be served. To capture these benefits, this article proposes 7 best practices for effective key account management. These practices can be leveraged by any size company in transforming its key account performance.
Choose your key accounts carefully
You are going to spend a lot of time and company resources on this account, hence choosing an account that you think will significantly benefit your company and deliver a large amount of revenue is crucial. To determine which accounts are worthy, you can develop a selection criterion that aligns with the two organizations. This criterion can include 3-8 objective parameters like product fit, revenue potential, growth potential, cultural fit, and existing relationships, among others, weighted in relative importance to your organization.
Conduct research to identify the needs of your key account
As a key account manager, you must know your client inside and out. To do this, you need to research the client company to build out a comprehensive profile. You can investigate and assess the client’s business, its markets, challenges, goals, and competitors. During this entire process, your aim should be to understand your client’s pain points and goals to identify opportunities for added value and collaboration.
Create a rock-solid strategic plan for your key account
Based on your needs’ assessment, drill down to the best strategic opportunities and draft an account plan. This plan is your strategic roadmap for the next 1-3 years and should include things like: Strategic recommendations (e.g., potential partnerships with other companies, creative solutions, etc.), Specific long-term goals with short-term benchmarks and Resource requirements. To further increase the effectiveness, you should also refresh this strategic proposal at key junctures- annual planning, quarterly business review and, when the competition starts to nip at the customer’s heels.
This is your chance to demonstrate to the client that you have done your homework, gone above and beyond the call of duty, really taken its business problems to heart, and put your best people on those problems to come up with ideas for solving them and being more successful.
Have a firm grasp on the key players within an account
As part of your key account management strategy, you will also want to ensure that you have a firm grasp on the key players within an account. You will want to know who the strong influencers and potential buyers are to optimize your time. The key thing to remember is that you should not limit yourself to just one point of contact within the business as nothing puts an account at greater risk than having just one contact. Studies show that businesses rarely sell to just one individual; rather, they sell to a group of decision-makers who hold different positions throughout their entire company. Thus, part of a strong key account sales strategy should involve contacting each of these decision-makers and discussing the benefits of your solution.
Establish a cadence for meeting and reporting your key account
Once you have a strategic plan in place, you should set a regular cadence for ongoing communication with your key accounts. You must outline a schedule for each touchpoint, meeting, and follow-up to ensure your client is in the loop and has the opportunity to give feedback, communicate changes, or ask questions. This schedule will help you stay updated on what your client needs, how they are using your product or solution, and how you can help.
Continuously monitor the performance of your key account
It is critical to measure your performance continually so that you can keep the plans on track and pivot or reassess as needed. For this, you can focus on answering questions like what progress have you made on your short-term and long-term goals? How do your results measure against your KPIs?
Monitoring performance is not only important to ensure that you deliver on your end but also to track how well the key account fulfils its obligations to you. While you want to drive value for the client, the goal is one of mutual long-term benefit. If the relationship no longer holds the same strategic value for your organization, then it is better to identify that sooner rather than later.
Be proactive and keep deepening relationships
Rather than waiting for your clients to bring up issues or ask about certain product and service options, it is vital to be proactive. You should regularly check in with your key accounts to ensure they are satisfied. They probably do not often research changes to your company, so keep them updated on your new, improved offerings. By actively communicating with your key accounts, you gain trust and insight into their health. It is essential to understand that unless clients feel that companies genuinely care for them and have their best interests at heart, they would not do business with you.
Conclusion: Based on these 7 best practices, it can be concluded that key account management transformations are not only about offering more competitive pricing and locking in larger contracts, which in the end can simply lead to a race to the bottom. Instead, key account management is a holistic process that requires concentrated efforts.
Keeping this in mind, InspireOne has developed a program for effective Key Account Management. This program employs the RAST (Research, Account Analysis, Strategy, and Tactics) framework and focuses on increasing productivity from a key account by giving account managers the essential edge they need in the management of critical stakeholders in an increasingly competitive business environment. To know more about this program, feel free to connect with us!
References:
6 Account Management & Account Strategy Best Practices. (2020, November 20). Retrieved December 28, 2020, from https://www.richardson.com/sales-resources/strategic-sales-key-account-management-strategy/
The 7 Habits of Highly Effective Strategic Account Managers. (2018, November 02). Retrieved December 28, 2020, from https://yesler.com/blog/customer-engagement/the-7-habits-of-highly-effective-strategic-account-managers
