1. Frameworks for putting KAM into action
Dublin Institute of Technology
2nd November 2017
Professionalising Key Account Management

2. Frameworks for putting KAM into action
Diagnostics
Key account readiness, KAM programme progress and risk
Tools
Customer analysis and strategic account plans
Processes
Implementation processes for key accounts

3. Customer readiness for KAM
When? Before you embark on KAM or if you have ‘corporate wobble’
Are your most important customers …
Answers
1. Communicating opportunities and initiatives and involving you in their strategies?
Yes/No
2. Expecting an understanding of their business: inviting you to meet a wider range of people in their organization and giving a broad range of information about their business and marketplace?
3. Wanting to explore joint projects involving more commitment?
4. Wanting to talk longer term and develop strategies together?
5. Asking for a more senior account manager with more authority and/or competence?
6. Wanting a transparent or integrated approach and a single point of contact, dealing with them as a single entity?
Yes to 2 or more of these questions for 2 or more of your top 10 customers indicates a need for KAM
– not for all customers, but your company needs to offer it.

4. Transitioning to KAM: where you are on the journey
When?
After you have started KAM and need to know where you are and what to do next
To make sure you are still moving forwards – check at different times
If you need to explore and reconcile divergent views on progress and expectations

5. Typical results, ‘quick and dirty’ audit

6. Key account portfolio When?
To select your key accounts, ideally before KAM but probably second stage
To agree overall strategies/approaches to key accounts, especially internally
Determine resources applied to each key account
Agree outcomes expected from each key account

7. Scoring customers on the account attractiveness axis
Account attractiveness criteria

8. Key customers scoring you against their CSFs
Customer must select criteria, NOT supplier – therefore each will be different
Assess v best competitor – what’s the point of being judged against the worst? They wouldn’t use them anyway.
Gain scores against specific competitors, industry ‘average’ is meaningless
Might be tough to hear, but provides gold mine of info on what to do.

9. Management tool as well as diagnostic

10. Assessing key customer riskiness
When?
You have to make decisions about how to respond to a customer, what action to take
To help you to understand, manage and reduce risk
To build into your calculations of the account’s longer-term value
The company needs to evaluate and manage the risk attached to its investments in customers, and its overall financial position
Risk index

11. How do you measure account risk?
Consider all the 5 potential risk areas and apply the ones that are common across your business and most influential in affecting riskiness
Don’t bother with things like financial stability that don’t apply to any key customers – have you really selected any key customers who are not financially stable?

12. Risk and return for key customers
Adding to shareholder value
Line of acceptable risk/return
Level of return received
Any strategy below the line destroys shareholder value
Zero risk rate of return
Specific risk of customer
Relative customer risk

13. Analysis & business strategy development: tools and process
When?
You need to understand a new key customer
At least annually, when you are developing tailored strategies and value propositions
To assess the value of the customer to your company
Customer’s SWOT & strategies
Environment & market analysis
Customer’s opportunities
& threats
Customer’s value chain analysis
Customer’s strengths & weaknesses
All about the customer

14. Linking customer understanding to your strategies
Environment & market analysis
Customer’s opportunities
& threats
Customer’s value chain analysis
Customer’s strengths & weaknesses
Your value chain analysis
Your strengths & weaknesses
Your SWOT & strategies
Environment analysis
Your company
Your opportunities
& threats
Customer’s SWOT & strategies
Key customer

15. Generating strategies from SWOTs
Helps generate customer-specific strategies
Need to match strength of strategies with ambition and customer potential
Broadly, offensive strategies develop business, defensive prevent business loss
Generate lots, commit to manageable number
Nine-box SWOT
Capture strategies/VPs in a customer-specific plan, using a standard plan format

16. Understanding how your company works for key accounts – or not!
When?
Getting key customer-specific decisions implemented is difficult or inconsistent
Key customers are asking your company to do something new for them
Other functions are not on board with delivering tailored offers
You need to speed up or cut costs
You may have great processes normally, still not good at delivering variants for key accounts
Ultimately, key accounts will judge by what you deliver, bit what you promised!

17. Questions for you
Does your company have a formal, meaningful process for plan approval?
Dies your company have a process for aligning and combining key account plans with your company’s annual business plan?