Key Account Management, The Jewel in Sales’ Crown
Sales is a critical function in any organization and have always been able to attract internal resources, both human and capital. Key Account Management began as an add-on to sales or a different way to structure departments and assign responsibilities. Though it received plenty of account management focus, there were few specialized human resources and even less capital or technological resources. Only when the number of key account managers reached a tipping point did firms felt the technology-pinch, unable to support collaboration, consolidation or standardization of methodology. But the times changed and with them the behavior of the Key Account Manager.
So why have companies been willing to spend resources on CRM, sales training, etcetera but not on KAM?
It could be because top-line results are credited to front-line sales while key account managers slog behind the scenes. Top management commitment is important, but it is not enough to create a successful KAM program. Without adequate resources can a company create the foundation on which to build a robust KAM system?
In our experience, a three-pronged approach to KAM yields the best results.
1. Choosing the right Key Account Managers: Your best salesperson is not necessarily the best key account manager. Along with influencing skills, they also need collaborative and general management skills, the ability to interact with internal and external stakeholders, to identify problems and design appropriate solutions. It definitely helps to have a manager who can take a long-term perspective on building relationships. While you may choose a person for the role based on some inherent traits and skills, it is also important to invest in training key account managers to help them achieve their full potential.
2. Choosing the right technology: Just as sales managers are enabled with CRM, key account managers need to be enabled with KAM-specific technology. Key Account Management software draws data from a CRM like Salesforce, thereby avoiding data entry and duplication. It supports collaboration across multiple departments and executives at different hierarchical levels. It helps create a relationship matrix and identifies white space or white space opportunities. A standardized process and unified view help improve performance.
3. Measuring and monitoring achievements: Here is a truism that is often ignored: Sales targets and key account goals are not the same. If you want a key account manager to develop a long-term perspective, you have to create long-term goals and pick quantifiable criteria that measure the health of a key account. Account management tools are a great asset as it gives you a multi-dimensional view of the key account; revenue, profitability, deals in the pipeline, relationship strength, untapped potential, share of customer’s purchase and more. Each parameter is measured and monitored individually, followed by analytics to calculate the overall health of a key account.
The first CRM software, introduced in the nineteen-eighties, was a simple digital Rolodex! It took several decades and massive technological innovation before CRM became a necessity, not an option or luxury for sales professionals. However in today’s technologically advanced world, decades have shrunk into years and companies that have not invested in KAM technology are not able to exploit, or even recognize, the potential of their key accounts. Your budget should no longer be a debate about CRM or KAM. If you want to maximize growth and tap the potential of your key accounts you need to enable your key account managers by investing in KAM technology. Stop treating KAM as a stepchild. In today’s customer-focused, solution-oriented market, KAM is the jewel in sales’ crown.
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About the Author
CEO & Co-Founder, DemandFarm
Milind is CEO & Co-Founder of DemandFarm. Having practiced and evolved the ‘account farming’ principle for over a decade he established DemandFarm and is passionate about delivering the best B2B key account management tool to serve the needs of key account managers. Milind also serves on the Board of LeadEnrich & is a Strategic Adviser.