The Getting-Started Actions

We have discussed customer assessments and how critical it is to capture customers' expectations and concerns before developing a strategic account management program. If you find two large customers who are solely interested in lower price, for example, you can save yourself a great deal of investment. But here also is a rare opportunity for leveraging research: use video focus groups as a part of these assessments, and you will have a way of demonstrating what the customer said to all those employees supporting strategic account management. Video focus groups, where the customers directly address the viewer, are a powerful way to help create alignment. And, at the beginning of such a tape, when the customers introduce themselves, we strongly suggest using a graphic overlay showing the 10-year value of the customer's business. The overlay changes a talking head into a multimillion-dollar voice. That way it becomes much easier for everyone to see how much that customer's good opinion means to the firm.

Once the company gathers the customer data, it's time to start having the cross-functional alignment discussions that will ensure that the strategic account management program will be a business rather than a pure sales initiative. The approach has to generate short- and long-term sales, yes, but as a business initiative, the program will generate more revenue if the entire supplier is actively behind it. Strategic account managers will have to spend significantly less time selling projects internally if the firm is already on board.

These alignment discussions involve looking at the ways in which the supplier currently deals with strategic accounts. Supplier policies, practices, and systems can deal with such customers. It will be very important to study them and to determine from the accounts which of them is working and which is not. For example, how many personal relationships—both inside the supplier and at the customers—do SAMs currently have to manage?

It's also time to do a portfolio analysis on potential strategic accounts—as in-depth a view of customer profitability as possible. In some cases, this analysis can teach you more than you want to know about your large customers. Given the investment a strategic account management program takes, it's better to identify true returns before designating a given customer as a strategic account. Basing potential returns solely on revenue or averaged profits can cost a firm a great deal.

A supplier can also examine other successful strategic account management approaches. This used to be far more challenging, but now, with new sources and conferences available (including those put on by the Strategic Account Management Association), you can hear presentations from and maybe even get an introduction to directors of successful strategic account management programs. Usually a noncompetitive firm is willing to answer questions; occasionally it will let you come speak to a contact there.

Value quantification is crucial to strategic account management success. A group of executives can start to develop a profitability model for targeted customers as well as a model to quantify the value of delivered products and services. Recall the words of the strategic account manager in Chapter 6: "Unless it is quantified, value doesn't exist."

The results of the getting-started actions include, most importantly, an aligned strategic account management program (SAMP) purpose and strategy—commitment from various functions to support the efforts of the SAMP. This includes agreements and processes by which multiple functions can effectively work together.

With customer input about the level of account manager contact desired, the supplier can work backward to determine an appropriate staffing model. The one presented in Chapter 5 is an effective way to cross-validate how many relationships an account manager should manage.