A New Way for Printers to Think About Their 'Key Accounts'
After years of careful study and analysis, I’ve concluded that the business development process in many industry firms is in dire need of help. In fact, it is increasingly clear that in many organizations, little is being done to effectively plan and execute for strategic business growth. Most every business needs to add new names to the customer roster and on a regular basis if only to offset the natural and predictable loss of current customers. At the same time, taking a new look at our existing accounts may pave the way for clarity and growth.
Most businesses have what they call “key accounts.” In many cases, an account becomes “key” based on sales volume. Other measures may include value added, profitability or even tenure (how long they have been a customer). While these are important elements, they reflect what is commonly called “inside out” thinking. That is, we consider first what matters to us (sales, value added, profitability, customer retention) rather than what matters most to our customers. Conversely, an “outside in” approach considers the characteristics and factors that attract and keep customers from the perspective of the customer. While more difficult to ascertain, this is usually a more accurate indicator of customer satisfaction and a far more reliable predictor of customer retention and growth.
Key accounts are key based upon the extent to which they depend on you to accomplish their objectives. How indispensable are you to their success? What would happen to your best customers if you no longer offered the products and services they are buying from you now? Would they experience a disruption in their business process? How difficult would it be for them identify and secure a replacement?
These best relationships are a prime source for additional business. As with so many things, you can wait for this to happen or you can plan for it to happen. One way to do this is by utilizing a unique approach we call the Key Account Accelerator Process.
We begin by listing your top 10 accounts. A simple grid is created with your customers listed down the left the side of the page and your product and service offerings across the top. We then take one account at a time and determine which of your offerings they are currently buying from you. What percentage of their total available spend are you getting? What are they not buying? Why? Do they have a need for these? Are they using another source and if so, why? Do they know you offer these services (don’t be surprised if they don’t, even if it is “on our website”)?
If the customer relationship is strong (that is, we have proven to be a trusted and valued resource) and we can identify service offerings from our existing portfolio which may be helpful to them, all that remains is to communicate this in an effective way. This requires careful planning and will likely involve senior management’s active participation (hint: this is not a job best delegated to the account rep alone!). More on this next time.
Joseph P. Truncale, Ph.D., CAE, is the Founder and Principal of Alexander Joseph Associates, a privately held consultancy specializing in executive business advisory services with clients throughout the graphic communications industry.
Joe spent 30 years with NAPL, including 11 years as President and CEO. He is an adjunct professor at NYU teaching graduate courses in Executive Leadership; Financial Management and Analysis; Finance for Marketing Decisions; and Leadership: The C Suite Perspective. He may be reached at Joe@ajstrategy.com. Phone or text: (201) 394-8160.