Why manage accounts strategically?
“Too many people think only of their own profit. But business opportunity seldom knocks on the door of self-centered people. No customer ever goes into a store merely to please the storekeeper.”
Managing accounts strategically is a proven way to systematically monitor changes in your customers and competitors and make strategic choices for the future. Companies across industry sectors: pharmaceutical, medical products, financial services and manufacturing have successfully applied the Strategic Account Management (SAM) framework to drive relentless positive change in their business.
So, what are the benefits of working more strategically?
Improving your customer's business results
- Creating superior customer value: helping your best customers respond to change and build better business results
- Working closely with your best customers to accelerate innovation in new products, services and/or sales channels
Improving your competitive advantage
- Competing on more than just price
- Reducing product commoditisation
- Reducing the risk of losing your most important customers; retaining high value customers
Improving your business results
- Growing business with your most important customers
- Reducing costs by eliminating the costs your most important customers don't value
- Reducing costs by working with your best customers: streamlining, automating and standardising business processes
You might be puzzled that one of the benefits of managing accounts strategically is to improve your customers' business results. However, this is one of the fundamental insights that can transform a business relationship. Adding value to your customers' business can be done not only from your products and services. So, don't focus on your products and services; focus on your customers' business results. Bring ideas and actions to improve your customers' business results, specifically where these ideas and actions do NOT involve products and services. This also enables your customer to see how your products and services fit into the broader strategic context.
Not mentioning your products and services to executives may seem counter-intuitive. However, this approach can transform relationships between organisations. If customer executives realise you are serious about trying to find ways of improving their business results (not involving selling more products), they will recognise the value you can bring and will treat you differently. They will treat you differently to a supplier who talks to executives just to try and sell more products.
The conversations with your customers' executives will be truly strategic exploring ideas that will have an impact beyond this financial year. All of this begins with being interested in delivering better business results for your best customers!
So, become interested in delivering better business results for your best customers. You will discover many ways to improve their business results that do not include reducing the price of your products and services; they are 'buying' a relationship with your organisation. In brief, every department in your organisation - finance, HR, operations, legal and sales - potentially has ideas, contacts and information to improve the business results of your customers independently of your products and services.
As you find more ways to increase the business results of your best customers beyond your products and services, you will improve your competitive advantage. The customer is now 'buying' more than your products and services. So, the more you improve their business results, the less price competition you will see and the less commoditisation of your products and services you will see.
Once you are delivering better business results for your customer, beyond your products and services, you will start to improve your business results. The most obvious benefit will be increasing sales. Because the customers wants to reward you for bringing them better business results and because they see you as a strategic supplier who can help them improve their business results. More strategic discussions will also allow you to identify opportunities to reduce your costs and your customer's costs by working together differently.
Summary
If you help deliver better business results for your customer, then you will improve your competitive advantage and improve your business results. Managing accounts strategically will help you manage your business challenges and help you deliver your business priorities; managing accounts strategically will deliver you growth in revenue and growth in profits.
So, what are you waiting for?
The journey is not easy and it is not quick, but this book: Managing B2B customers you can't afford to lose will give you practical tools and insights to help you. Learn how to Manage Top Accounts to achieve your business results at the University of Newcastle, Sydney.