We’ve been talking a lot about key account management lately. It is undoubtedly the most significant change in the way companies sell in recent years and is critical to the success of most corporations.As a relatively young way of doing business, key account management is certainly not without problem in many organizations. Use the quiz below to self diagnose, or use it at your next team meeting to launch a discussion on the strengths and weaknesses of your key account management team. Everyone who interacts with your key accounts should be proficient at each of these skills.
How do you rate your skill at the following?
Planning and asking high gain questions
when meeting with key accounts
Tailoring your value proposition for
each key account sales opportunity
Gaining access and effectively
influencing key decision makers
Planning and conducting negotiations
that minimize making price concessions
Forming and working well when
a team approach is needed
Visit STAR’s workshops pages to learn more about our Key Account Management Workshop designed for experienced sales people and our Key Account Management Workshop for Managers. The workshop can be fully customized in terms of duration, content, and materials.
Key Account Management seems to be the buzz word in sales today. It is, in fact, a relatively young discipline, yet there are thousands of employees wearing the title "Key Account Manager.”
Of course you know that key account management is more than just a title or a sales technique. It is an organizational change that requires buy-in from a high level.
There are many opportunities for mistakes to be made in the key account management process. Not all organizations take the time needed to accurately identify their key accounts, assign appropriate personnel and resources, or set attainable metrics.
For today, I’d like to highlight the most common mistake that companies make regarding key account management. I can explain it best by sharing with you what we’ve heard from other clients who have used STAR to help them implement a key account management program.
As a sales training consultant, I’ve asked many clients these two related questions.
First, do your key accounts represent a disproportionate share of your profits and growth potential? The answer is always "yes.”
Second, since your key accounts represent such a large percentage of profitability and growth, have you assigned your best salespeople to these key accounts? The answer is usually "…no, we haven’t necessarily assigned our best salespeople to these accounts.”
As such, the #1 mistake is to not assign your best salespeople to your best accounts. If you do nothing else about key account management, do this step. Otherwise, any coaching by your managers or workshops for your people are likely to be wasted time and effort.
"In business or football, it takes a lot of unspectacular preparing to produce spectacular results."
- Roger Staubach, Hall of Fame Football Player
Success factor #1: Have you identified and built a relationship with the highest-level decision maker?
You cannot win a big sale at a key account if you don’t have buy-in at a senior level. Similarly, you are most at risk if a senior decision-maker at one of your key accounts is replaced by someone else. Key account managers in STAR’s workshops consistently have stated over the years that they are most likely to lose a piece of business when a senior decision maker who is one of their advocates leaves. Don’t let this happen to you.
Success factor #2: Have you prepared a compelling value proposition to support your recommendation?
Key accounts reward suppliers who can help their bottom line and/or increase their revenue. Otherwise, they aren’t likely to be motivated to change. You can learn how to quantify and present a compelling value proposition in STAR’s Selling On Value Workshop. The best sales professionals do this well, and use fact-based selling by citing and highlighting quantifiable financial impact such as ROI and payback for the customer.
Success factor #3: Have you anticipated and prepared a response to the most likely client objections?
You must be prepared to overcome more objections when you sell to key accounts, for two reasons. First, major buying decisions at key accounts will be made by multiple decision-makers. Each decision-maker may raise a valid reason not to buy from you. Second, key accounts will compare your offer to several of your major competitors. Your sales strategy must take into consideration where you are vulnerable relative to a particular competitor.
Success factor #4: Have you developed a negotiation strategy that takes into consideration concessions that the customer is likely to request?
As cited in STAR’s Sales Negotiation Workshop, you shouldn’t be surprised if a key account asks for some concessions during the award and post-sales phases of the sales process. Average sellers tend to concede too much, too soon, whereas successful negotiators are skilled at responding to concession requests and adversarial tactics. In last month’s newsletter, we talked about the advantages of using a sales team at a key account. If you opt to use a sales team, the entire team must be good at negotiating.
If you or your sales team are interested in developing a sales strategy, STAR’s Key Account Management workshop teaches the skills and concepts to do so.
"None of us is as smart as all of us.” - Ken Blanchard, author of One Minute Manager
Many sales organizations have found that a sales team is an integral part of a sales strategy. For example, consider how a sales team could help you:
- Multiple team members can be used to broaden and strengthen relationships with the various decision makers.
- A team can do a more thorough job of analyzing opportunities and threats, based on their knowledge of different competitors and their exposure to different divisions and departments within the key account.
- To the extent that value selling and negotiating are necessary to win a key account sale, a team can do a better job than a solo salesperson. Teams generally are better at presenting better solutions when planning for a complex sales presentation or negotiation.
If you decide that a team approach is warranted, your sales strategy must then consider these additional elements:
- Who should be on the sales team? There are some obvious considerations, such as adding functional specialties such as technical service, marketing, and production/operations. However, there are also less obvious factors such as knowing which team roles and personalities are likely to generate and sustain a productive team atmosphere.
- Who should lead the sales team? It shouldn’t necessarily be the salesperson.Dual leadership is a good way to balance the workload. For example, let the salesperson lead the team during the client meetings, but let someone else lead the internal strategy and planning sessions.
- How can we assure that we are aligned on goals and roles? Lack of alignment on goals and roles will cause the team to flounder and potentially fail.