Regularly Quantify and Communicate the Value Received From and Delivered to Strategic Accounts

How can you ensure that you are regularly quantifying the value you receive from and deliver to strategic accounts?

1. Go through the lifetime customer exercise, initially with your three most critical accounts.

2. Take a hard look at the value you deliver to those accounts, their replacement costs, and what investments your people believe your company needs to make in those relationships.

3. During this exercise, if you question your profitability data, meet with the departments that have cost data and develop a profitability model to calculate what numbers really matter to them.

4. Calculate the cost of your processes. Your firm probably won't be able to do it as completely as BOS, but it can certainly focus on 20 percent of the processes that generate 80 percent of its costs.

5. Then, if you do not currently quantify value you deliver to clients, develop a means for doing so. Isolate the value of products from the value of services you deliver. As we saw with both BOS and Holland, a piece of software that automates this process can be very effective.

6. If you have industry or customer-performance data, compare for the account what it costs for it to do the business with what it costs you to do the business (assuming your process has greater efficiency and effectiveness than the customer's). Given the size of your critical customers, you may be able to make a case to do some activities-based costing at their firms and yours.

7. If possible, develop a normative performance database (as Holland did) with your clients to determine where their costs are too high.

8. If the value is very difficult to quantify, work with your strategic account. When you explain that you want to quantify the value it is receiving, the account usually will help you define that value.