PLANNING
The only place to start when it comes to planning account management
activities is with the customer's business.
In
today's turbulent markets organisations have spent a great
deal of time and energy defining their mission, vision and
values. While they have done this essentially for internal
communication purposes they undoubtedly expect their suppliers
to understand and focus on them as well.
Where
these statements exist, good account managers not only record
them, but positively acknowledge them in their dealings with
their customers.
Behind
these statements of intent however lies the customer's actual
business. The history, the current objectives, the strategy,
the resources, the structures, the systems, and the skills
required of their managers and employees are all relevant
pieces of information for the successful management of the
account. All need to be understood by today's account managers
to enable them to place their products and services into the
overall context of the customer's business.
Increasingly,
customers also expect account managers to understand how their
business plans will impact their use of the account manager's
products. They expect account managers to be thinking about
the issues of cost saving and quality. They take for granted
that account managers will readily understand how their products
and services may need to change in the light of expansion
into new markets and territories.
From
the customer's point of view therefore good account managers
show that they have a complete grasp of their business and
their contribution as a supplier to its profitability and
growth. They can show that they have a real empathy with the
customer's situation and needs.
When
it comes to these issues, suppliers have the same interests
but for different reasons. Their interest lies in their desire
to constantly spot openings for more sales and to see opportunities
for the introduction of different products, technologies,
and applications. Their concern with these issues is more
to do with the vulnerability of the account to competitor
threat, and how the customer's future plans will present either
opportunities or risks for them. Empathy for them means staying
close to customers, and close is the only place to be these
days.
From
the point of view of suppliers therefore it is vital that
their account managers have a firm grasp of all the commercial
issues surrounding the account, because only
if
they do can they hope to get closer to the account, act in a
more strategic way, and so shut out the competition.
Planning account management activities also involves the people
issues which play a part in the successful management of the
account. Customers want their buying and decision-making processes
respected, and require sensitivity from account managers to
their internal politics, power-bases and personalities. They
want a sales effort that is co-ordinated with the account manager
involving specialists and other colleagues in a planned and
structured way. They want to have a say about the frequency
of visits and with whom they prefer to deal. In short, they
want to be managed but with the involvement and agreement of
their key people.
Suppliers
likewise want their account managers to plan and manage the
people issues. They know that internal roles, levels of authority
and discretion, and the structures (formal or informal) within
the customer all play a part in buying decisions. They know
that these decisions are not always rational but can be based
on perceptions, feelings and subjective judgements. They recognise
the need for individuals within the customer to feel included
and cared for. They understand that clumsy account management,
involving many different people in an unstructured way, will
annoy the customer and reflect poorly on them as a supplier.
They recognise that insights into the people issues at the
planning stage are key to their success.
It
is the job of account managers therefore to know, understand,
and to be able to use all available information to plan their
account management activities. Planning is the first step
to satisfy the needs of both parties.
Planning
then translates into defining account management goals and
strategies. Again there are two sets of requirements of the
account manager when it comes to approaching the task of achieving
the goals and strategy in the best way. The requirements involve
a complete understanding of the buying cycle-as seen by the
customer and as seen by the supplier.
MANAGING
THE BUYING CYCLE
Approaching the task of managing accounts involves seeing
the buying cycle from two perspectives-the customer's and
the supplier's. Both perspectives are similar but are subtly
different and it's important for account managers to understand
the differences if they are to play their dual role.
When it comes to the buying cycle from the customer's perspective
it follows a six step process. The process exists whether
the customer is an existing account or a prospective account.
1.
Need/problem identified
At this step the customer recognises that it has a need or
a problem which it has to address. Having ascertained that
it cannot supply the solution itself it embarks upon a search
to identify the best provider of the solution.
To
do this it may contact one or a number of potential suppliers
and briefs them on its need or problem. The intention is to
find the best solution.
2.
Exploration of options
The next step in the buying cycle involves the exploration
of options with various external suppliers. The customer will
make comparisons, weigh up the pros and cons of different
approaches put forward, and will make both objective and subjective
judgements as to whom comes closest to its buying criteria.
Those suppliers who come the closest are normally invited
to present their solutions more formally.
3.
Presentation of different solutions
By the time different potential suppliers are asked to present
their solutions, the customer will have prioritised the requirements
in their buying criteria and will have agreed the roles of
different individuals in the buying decision. At this step
the customer is looking for shortlisted suppliers to show
a complete understanding of its needs and priorities, and
is looking for a convincing presentation of the best solution.
4.
Decision to buy
The decision to buy is largely dependent on the quality of
the presentation of solutions and results from a number of
factors. Ultimately they can be summarised by the 'SPACER'
mnemonic as follows:
| Security |
Is
the organisation/ product/service a safe bet and risk
free? |
| Performance |
Will
the solution proposed perform as promised? |
| Appearance |
Will
those involved in the buying decision look good as a result;
will the customer look good? |
| Convenience |
Will
the solution be easy to implement? |
| Economic |
Does the solution provide a financial benefit? |
| Relationship |
Is
there a relationship which can be developed into the future?
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If,
for the costs involved, all or many of the above benefits
are supplied then the customer is likely to buy. If, on the
other hand, the costs do not provide the benefits, and in
addition involve risks, then the customer is unlikely to buy.
5. Implementation
Having decided to buy what is perceived to be the best option,
the customer implements the solution and experiences the reality
of its purchase. At this step the customer is usually anxious
in the early stages and seeks all the support and reassurance
the supplier can give.
Throughout
the use of the product, process, or application it is the
visibility and frequency of contact between supplier and customer
that is all important to ensure total satisfaction with the
solution bought.
...READ ON
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6.
Progress and evaluation
The customer's future depends on its abilities to profitably
satisfy the needs of its own customers, and its customers' needs
will certainly change in the light of market conditions. These
days it is not long before progress and change are followed
by evaluation and new needs or problems are identified of concern
to the customer which impact the supplier's product. At this
point the buying cycle starts again and is repeated.
Seen
from the supplier's viewpoint the buying cycle is slightly different.
1.
Need/problem identified
Either by proactively seeking out the business, simply working
closely with the customer, or responding to an enquiry, the
sales person identifies the customer's needs or problems.
2.
Investigation
Depending on the complexity of the need, the sales person, alone
or with others, carries out a thorough investigation of the
needs or problems, and prepares a formal proposal, or simply
presents solutions (if the customer is well known and a good
relationship exists).
3.
Presentation of solution
The sales person presents his/her product/service/technology
as a solution to the need or problem and answers questions/objections
relating to the solution. Other suppliers may be asked to do
this as well if they have been involved at steps 1 and 2.
4.
Buying of solution
The customer buys the solution, with or without a negotiation,
and formalises the agreement to buy in a contract or agreed
terms of trading.
5.
Implementation of solution
The solution is implemented and the customer has the ultimate
'show proof' in the product/service/technology provided by the
supplier. After sales support is the key requirement of the
sales person at this step.
6. Progress and evaluation
As the customer's business moves on the requirements change.
They grow, they differ, they evolve, and as a result of the
customer's demands and market-place trends, needs are re-assessed,
problems identified and the opportunity for selling arises again
for the supplier, and the process is repeated.
While
the buying cycle is always obvious at the time of securing a
new customer, it is very often neglected when it comes to account
management. And yet it is this process that is constantly going
on and which produces the opportunities to protect and grow
the account as well as care for and cultivate the customer.
It is the process through which all successful account management
takes place.
The
successful account managers constantly monitor and evaluate
their customers' progress, needs, and problems and actively
use the buying cycle to spot and manage new sales opportunities.
Successful
account managers also know how to manage individuals involved
in the buying process, the next key ingredient to their success.
MANAGING
DECISION-MAKERS
The decision-making processes within an account vary significantly.
Rarely do they involve just one individual, and rarely are they
discernible simply by looking at the customer's organisation
chart.
Buyers,
line mangers, specialists, accountants, senior influencers,
directors and even entire boards can be involved in all or part
of the decision-making process.
Successful
account managers are able to understand the concerns, the role,
and the personality type of each influencer involved in a sales
opportunity, and are able to respond convincingly to each one.
Each
influencer will have a perception of the progress the organisation
is making, and the needs or problems it has. Account managers
need to understand these and the reasons behind them. To do this,
they need to enlist the help of a 'champion' who wants the sale
to succeed. Good account managers have 'champions' in every account
and know how to work with them to manage the decision-making process
in the best possible way.
From
the customer's point of view, account managers are doing a good
job in managing their decision-making processes when they can
relate to a wide population of people within the account and
can talk their 'language'. The issue ultimately is one of trust
born out of an account manager's credibility with a wide variety
of people
From
the standpoint of suppliers, the more people their account managers
know both up and across their customer accounts, and the more
aware they are of the decision-making process and influencers
within them, the greater the likelihood of ongoing success in
servicing and growing their key accounts.
Account
managers can only do so much to achieve success in these areas
on their own. The help of internal colleagues can make all the
difference. Their final skill is that of being able to manage
and motivate account management teams, usually made of individuals
over whom they may have no direct control.
MANAGING ACCOUNT TEAMS
Account management teams can exist for a particular sale, for
the duration of the relationship with the customer, or at a
point in time during the relationship with the customer. They
can vary in size and membership and the individual members usually
play different roles in the management of the account.
There
are many good reasons for having more than one person involved
in the management of an account.
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Greater
depth and breadth of expertise brought to the customer |
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Like
level people dealing with one another |
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Avoidance
of exposure to just one individual |
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The
gaining of different access points to the customer |
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Coverage
of split sites, different locations, and different decision-makers |
Account
teams however need to be managed, and this is not always easy
given that account managers may not have direct control or authority
over other team members. Accountabilities of team members can
often be very blurred.
Successful
account managers are able to influence others from within their
organisation to assist them; they can co-ordinate the efforts
of colleagues to bring an impressive team together for the customer's
benefit.
The
skills of consultation, persuasiveness, negotiation, and relationship-building
all play an important part in this aspect of the account manager's
role. Without these skills and the active support and involvement
of colleagues the account manager can be severely disadvantaged.
SUMMARY
Account management is a balancing act. It requires great sensitivity
to the needs of both the customer and the supplier. Both parties
rely on the skill of the account manager for the success of
the ongoing relationship.
The account manager needs to be constantly in touch with what
is going on within the account and how this translates into
the buying cycle. The buying cycle continually produces opportunities
for the account manager at the progress and evaluation stage.
At this point, being able to consult, manage, and influence
decision-makers is critical to the account manager's success.
The
whole account management process can be helped significantly
through the use of account management teams who need to be properly
led and co-ordinated.
Account
management is a difficult and demanding skill requiring planning,
insight and a high degree of sensitivity. As an extension of
both the customer and the supplier the ultimate challenge for
account managers is quite simply TO BRIDGE THE GAP.
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