Pareto prevails… even in sales. We all know the pareto principle that says 80% of the business will come from 20% of our customers or clients, often known as accounts.
Accounts can vary in scope: a business, a division, a team, or a single account. Key Accounts are any organizational entity where we hope to have significant long-term relationships based on mutual value creation.
Here are three common challenges I come across when working on Key Account Management with clients all over the world:
Investing time appropriately
I promote the idea of KNOW, GROW, SUSTAIN, when it comes to key client or account management, and it’s an ongoing cycle, rather than a ‘linear’ series of events.
Sales professionals often make serious mistakes in their investment in Key Accounts. It is easy to over-invest without understanding the situation, or that the potential for additional business is minimal. Conversely, it is also easy to under-invest by assuming that the account is stable and requires little work or defence from your competition.
Top performing account managers take time to KNOW the situation (and key stakeholders) in their accounts, from what is happening in their market, with their competitors, and their end-user customers or clients. They KNOW what the account values to succeed in their respective market. All of this is critical in order to GROW. In addition, you need to have a growth strategy i.e. a clear plan with timings and key steps to execute on the plan. Once you GROW significantly, you need to protect and SUSTAIN the business. This often necessitates a different level of time and investment.
Getting broader and deeper in relationships
It’s much easier to maintain ongoing relationships than it is to find new centres of influence and potential business. I see many Key Account managers working very confined and narrow relationships when they are very well placed as a result of their existing work, to generate new conversations. Interestingly, many sales leaders do not focus on this as an area of opportunity.
The blind spot I see regularly is not around our known contacts and existing relationships. It’s around who we don’t know and whether these ‘unknowns’ hold the power or influence to negatively impact us.
The challenge is often how to grow our footprint in terms of relationships, how to identify whether people are advocates or detractors for us, and how to change their perceptions of us and our organisation.
Weak Account Planning
For many account managers, planning is seen as an ‘admin task’ rather than an opportunity to engage actively with the client and work jointly on a plan that meets both parties’ needs. Worse are the plans that are completed and then consigned to the filing cabinet (or computer folder) and not reviewed, measured, tweaked and reset.
As a sales leader ask yourself the following questions:
- Have you identified those accounts that you need to designate as ‘key’ with clear criteria that everyone recognises?
- Is there a common approach to managing key accounts, however you define them? (I’m talking about the simple operational standards and service levels that the client or customer expects as a minimum.)
- Do you have a planning format and cycle that is robust and adhered to by all key account managers?
- Do ALL of your key account managers possess the skills and tools necessary for their job of managing and growing or defending your business?
- Is there a real leadership discipline to review performance on a regular basis and support key account managers in the pursuit of their goals?
If the answer to any of these questions is no, you need to get some help or make some changes.