By investing in specialized capabilities, businesses can foster stronger relationships, drive mutual growth, and ensure long-term success with their strategic accounts.
A Key Account Approach -
As companies expand their market presence, it becomes crucial to effectively manage large accounts in order to drive growth. However, this is no easy feat as the internal decision-making processes within these accounts can be complex and slow, making it challenging for companies to navigate and generate growth.
This was the dilemma faced by the VP of Sales & Marketing of an innovative specialty chemicals producer.
The company had established dominance in a key product segment but their account penetration had stalled. Moreover, the entry of new competitors threatened account erosion, signifying a potential downward trajectory. Recognizing the need for assistance, the VP sought help to address this issue.
Key Accounts Require Special Sales Capability
Companies often establish cross-functional teams led by experienced senior sales representatives to focus on each large account. However, it is common for these teams to excel in a few capabilities, such as developing 1:1 relationships with customers, gathering account intelligence, and servicing existing business. While these capabilities are vital, they can also become a comfort zone, hindering companies from generating growth with key accounts.
To drive growth with strategic customers, an enhanced approach is needed. This approach involves additional capabilities that enable the identification of growth opportunities and the mobilization of organizational resources against them.
Firstly, teams must develop a market perspective of their customer's market, taking into account the customer's strategy, market dynamics, and competitive landscape. This allows for a clear understanding of what is critical to the customer's success. Secondly, having a focused account strategy is crucial. This involves determining how the company's capabilities can uniquely help the customer achieve their strategic objectives. Lastly, growth opportunities should be treated as separate projects, often requiring additional investments and dedicated teams. Unfortunately, many companies lack the necessary systems and processes to support such initiatives, resulting in stalled efforts.
Over-focused on Existing Business
In the case of the specialty chemicals producer, their teams were investing significant time in servicing existing business, limiting their focus to an inadequate number of growth opportunities.
Realizing this insight, the VP initiated initiatives to deepen the company’s market perspective and improve the quality of account strategies developed by the teams. The goal was to better identify and allocate resources to the most promising growth opportunities.
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Until next week,
Kendall -
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