It is the end of the year, and before we can enjoy the Christmas bonus and stuffed turkey, Key Account Management professionals have the unenviable task of reviewing the past year and creating account plans for 2017. You have probably been doing it every year, so you have a basis or a template, and all you need to do is update that, add projections, etc. But is it that simple? It is not just a sales projection; it is an account plan.
We can think of dozens of questions you need to answer while planning for a key account and you can probably add on to the list as well. So where and how do you begin?
Before you dig out last year's account plan formats, the old ppts or excel sheets ask yourself these questions; “How are KAM professionals in competitor organizations and other industries preparing their account plans? Is my old method the best, most efficient way? Is there a way to make account planning easier, or to create a more thorough, robust account plan?”
If you have paused to think about these questions, your first step has been in the right direction! Our experience providing KAM technology for IT service industry clients has shown us that they face challenges that are often uniquely different from those faced by other B2B industries. As we examine these challenges, we reflect on how they affect account management and how technology can ease the pain and assist with account planning.
Service, an Intangible Product
Organizations that have a tangible product can easily demonstrate and communicate the uses and benefits of the product. Therefore they depend primarily on the product quality and back that up or accentuate it with a brand. In contrast, the service industry has an intangible product whose benefits are not as easily demonstrable. Therefore trust or a brand name and depending on relationships and people is what attracts and retains customers.
One of the benefits of KAM technology is its ability to calculate the relationships mapping strength of key accounts. Another is the convenience of having a unified view of organizational hierarchy, showing all people related to the key account, in the client's firm and yours.
Making an account plan is easy if you use all the relationship related features offered by technology; use CRM as a base, drag and drop to create a key account's organizational hierarchy, assign a status to people based on their affinity for your company and services, plan periodic interactions between people from different hierarchical levels and more.
The result, #painfreeaccountplanning, and the confidence that it provides metrics on relationship strength and throws up warning indicators as well. This year you can use specialized key account management technology to create a well-articulated account plan, one that converts relationships from hurdles into the backbone and strength of marketing.
Interaction between the buyer and seller
Research by Rawson, Duncan, and Jones found that customers of service industries judged satisfaction based on cumulative experiences across multiple touchpoints. In other words, each time the customer interacts with you, be it the receptionist at your head office, the automated caller menu and every client service assistant and manager, he or she is judging the experience and consciously or unconsciously rating his or her experience.
A product has only one or at best a few touchpoints between the seller and the buyer. On the other hand, providing a service has multiple touchpoints throughout the life cycle of the service contract. Therefore more white space opportunities to delight or disgust the customer!
Knowing this, who wouldn't want to track customer interactions in a systematic and objective way? The solution- use KAM technology to collaborate with internal stakeholders, enumerate mutually agreed expectations and targets, and create a unified action plan. This is your chance to plan systematically and make each touchpoint an opportunity to delight your strategic account management.
Make or Buy Conundrum
In keeping with the holiday season, imagine you are a manufacturer of chocolates who finds he has the insufficient inventory to meet demand. Would you think of buying a cocoa plantation to increase your raw material supply, or of manufacturing a machine to temper chocolate? Probably not. You are most likely to approach sellers and buy them outright, even if you had to increase production at the cost of lower margins.
But what if an IT service provider approached you with software that could better estimate cyclic consumption and enable you to plan production and inventories such that you would not face seasonal crunches? Would you consider it right now, put it off till after the holiday season production rush, wonder if the investment would really pay off or think about whether you could do something similar in-house?
If you said yes to either of the last two options, you have just highlighted the challenge of selling services. Services, particularly IT services, are rarely perceived as immediate requirements. Their investment-outcome ratio is endlessly debated and often an in-house, home-grown alternative is chosen.
Can you overcome the make or buy conundrum?
One way to do this is to sell solutions, not services. KAM technology enables you to systematically catalog client requirements, understand the client's end goal and align your company's products and services to offer solutions accordingly. While key account planning this year, you can use technology to create a whitespace analysis and depending on the results, design and offer the right solutions to a key account. Creating new avenues of business from an existing client not only adds to your revenue, but it also makes the client feel valued because you are proactive in helping them meet their end goal.
Customized versus Standardized
Products tend to have standard specifications. Any variations or customizations are generally made at the request of customers. Hence the cost of customization is relatively easy to calculate and is often passed on to the customer. But when you sell a service as a solution, not a product, you have to customize the service to meet the client's need or perceived problem. Since this customization has not been explicitly asked for by the customer, it is very difficult to justify the need or cost of customization.
However, if you as a key account manager do not push for customization and introduction of new services you are making yourself vulnerable to competition. Use KAM technology's competitor analysis tool to track your company's strengths and weaknesses. Identify areas where you can create value-added customizations to increase business from your key account. The time to plan for this is now, build it into your account plan and give yourself new avenues for key account growth.
A product manufacturer can produce, sample, test the quality and pass or reject goods before the product reaches the consumer. But the nature of service is such that it is being provided and consumed at the same time. Therefore defining, measuring, and maintaining quality is much harder for services than it is for products.
When managing quality is difficult, handling complaints becomes a critical factor in retaining key account clients. A study carried out by the Warwick Business School revealed that 53% of situations of outstanding service came about as a result of well-handled complaints.
While we are in no way suggesting you create problems or situations for complaint, KAM peers in service industries agree that a quick and effective response to a problem or complaint is a great way to increase customer satisfaction. But flawless execution requires forethought and follow-up, both of which you can achieve through a technology-enabled account plan.
KAM technology keeps the account manager in the loop about operational issues in real-time. While creating your account plan this year allocate responsibilities for complaint handling, who will do it, within what time, and how to measure satisfactory resolution.
Change is the Only Constant
2,500 years ago Heraclitus, a Greek philosopher, said:
"change is the only constant"
He was talking about life, but it is true about business too and applies to products, services et al. As a key account manager, we know that you try to consider all the eventualities while planning.
However, your key account strategy has to be flexible to meet the changing economic scenario. So why not create an account plan that updates automatically, is flexible and can be effortlessly revised?
Use KAM technology as a tool to simplify the account planning process, as well as to give you the added advantage of automatic alerts and warning indicators. These are signals to draw your attention to variances, and when you need to make changes to the account plan, technology provides flexibility along with ease of change.
Eventually, the success of your Key Account strategy depends on smart account planning and consistent execution. Whether you work with products or services, local clients or global ones, make a new year's resolution to eliminate the pain of account planning.
To gift yourself #painfreeaccountplanning signup and use DemandFarm's Account Planning tools, free until 31st December. At DemandFarm, we help you plan smart and make the account planning process pain free. The Account Planning Wizard is as simple as completing a form.
The wizard helps you link your key account plan with an existing CRM such as Salesforce. It then guides you through every step of the planning process, prompting you to fill in additional information wherever required. You can skip information that you don't have and retain the option to update later. You can view your account plan at a macro level as well as drill down to see details.
Finally, you can simply export the account plan as a presentation or document, or both. We are confident that once you experience the convenience, ease, and effectiveness of account planning using the DemandFarm technology you will want more!
Subscribe for a year, and we will keep your key account alive with all the features, including auto-updates linked to CRM, sharing with multiple stakeholders, reports, status and warning indicators, prompts for execution, and the flexibility to change the account plan as and when you need to. Happy New Year, and Happy Account Planning too!