Solutions Marketing: 8 Critical Success Factors for Protecting and Growing your Best Accounts
- Customer Connection, Most Recent Blogs
- account management, Key accountssolutions marketing, Customer Connection,
- 4 comments
Our Latest Research Study at Solutions Insights:
For reasons that we have discussed in previous blogs, a robust, effective Key Account Management (KAM) program is often a characteristic of solutions-driven companies. Many of the companies that we have worked with have seen a KAM structure as an important vehicle for gaining a deep understanding of a customer’s needs and opportunities, leading to the creation of high-value solutions.
Working with our academic partner, the Hult International Business School in Cambridge, MA, the Solutions Insights (SI) team conducted a deep review of KAM data from analyst firms and industry associations like ITSMA, International Data Corporation (IDC) and the Strategic Account Management Association (SAMA). In addition, we interviewed nearly 20 large B2B companies that have been cited by various sources in the past for having outstanding KAM programs in place, including McKinsey, Dow Chemical, Boeing, AT&T, and IBM. Our objectives were to identify both the KAM program critical success factors that these companies had in common as well as the latest trends in how companies are responding to new technologies and chronic economic pressures.
The Growing Importance of KAM Programs:
It was clear from the secondary data research as well as the executive interviews that the focus on formal KAM programs has been accelerating in recent years. We identified several key factors driving this trend:
Eight Critical Success Factors for a KAM Program:
After a thorough review of the KAM programs managed by the companies we included in the study, we were able to identify 8 critical success factors that nearly all of them had in common.
How Does Your Company Compare?
We will be the first to admit that any one of our 8 critical success factors in themselves aren’t terrifically innovative or reflect breakthrough thinking. However, we concluded that the compelling takeaway is the cumulative effect that all of these 8 factors have on a KAM program. While not all of the best programs followed all of these tenets, certainly most of them did – and the others had embraced 6 or seven of them.
An excellent analysis of the key success factors of the KAM programs! In the context of this article, I have been reading about the "Employees first" program which has been implemented at HCL Technologies and is now a case study at the Harvard Business School. In the knowlegde intensive industry like IT (Of which HCL tech is one of the major players), it is increasingly being realized that the key to a satisfied client is in fact a satisfied employee, and this is the driving force behind HCL's "Employee first" initiative. Preliminary results based on simple metrics point out to the positive impact of this initiative on the HCL Tech business. Do you think that this pioneering initiative by HCL technologies can also be considered as another important sucess factor for KAM programs? Do you think that this model is sustainable and should be implemented in all solutions focused businesses?
All too familiar Matt. I could not agree more. In my 5 years with the world's largest shipping line, I took up 3 roles in Account Management, gradually taking up additional responsibilities with each progressive role adopting to the critical success factors you have addressed above. Yes, the four highlighted drivers are strong forces towards KAM, and with the customers becoming more sophisticated, they demand more - and it could very well be all of them! The Key Success Factors truly help the company to remain in perspective - who are the clients we cannot afford to lose (probably because of their volume business or affiliations/networks), establishing SMART objectives ensures the deliverable(s) are met not only for the key account manager but also the client. This is very powerful, when you put the client into the equation, because then you show commitment beyond 'transitional' once-off trade, and begin to build on strategic partnerships which creates extra customer stickiness. It is not unlikely that a KAM is appointed to handle a specific industry (to build specialized competencies key to the client and market) or is even allocated a desk in the client's office (inplant) to encourage collaborative and dedicated client solutions. Even with this approach, you will surprised how much room there still is for growth- both in profit and client base!
This article is very interesting, and makes sense to me. Since 20% of clients generate 80% of revenue, companies should focus on key accounts instead of spending money to gain new clients. Personally, making KAM a priority and having clear key account program successful metrics are the most important factor among eight. It usually takes time to evaluate KAM, at least 6 months after implementing it, and it is hard to measure KAM because KAM is about client relationship and more qualitative approach. Therefore, KAM team would face difficulty to show excetutives results in short term, and proof how successful KAM is. The KAM team have to get key executives' support by making KAM a priority, and make clear successful metrics in order to convince executives and get more support from them.
While the concept not being new I guess most of the organizations ignore the obvious and go for, as they would put it “innovative new ideas”. I think the insights in this article are very critical todoing business today. As mentioned the economy and the competition being the way it is today, organizations have to shift the way they handle, evaluate and consider the clients need s and what we as an organization can offer them. The KAM concept would not be the only differentiating factor but it would be one of the main reasons why new clients and current clients would stay with a company. Another key factor is client involvement and engagement is a very crucial part of KAM. The “New tools” part of the driving trends is also a very valid point, but it’s not just having the tools, knowing what is relevant and how to gauge it also very necessary.