How to Create a Strategy for Your Important Accounts

At the end of a recent keynote speech during which I was discussing the value of strategic planning in order to consolidate existing client relationships, I was asked what we at JFA do to lock-in our most important clients. This is an extract of my response.

For a long time the only objectives I used for Major Accounts were very specific business objectives – “We will increase turnover by X%”. “We will introduce two new programmes and increase our profitability by Y%”. I began to understand that these business objectives were not enough.

Multi-level objectives has proved very powerful in winning and keeping business. There are four levels of objectives and together they create objectives that excite and motivate the team and at the same time are also very practical.

First we set visionary objectives – we picture what the result could be if everything went well. We discipline ourselves not to be limited by history or today’s issues. The outcome is a very strong vision of what the account could be like in 1 / 3 /5 years.

Secondly we set relationship objectives – everyone in the account team needs to know what we want the relationship to feel like. Imagine you could hear your customer talking about you in two year’s time – what would you want to hear them saying? It might be statements like “We trust them completely”, “They always give us new ideas”, and “Things do not go wrong often. But when they do, they always make things right quickly.” We have found that these relationship objectives help us do everything in the way we should and in the way the customer wants. In the past, it was more difficult to be consistent and customer-centered.

So far we have talked about quite “soft” objectives – how we want things to feel. The first two objectives are about emotion and imagination, but we need some “hard” objectives as well. The third level is the level of business objectives. These objectives are specific and very clear – “By the end of this year we will have increased sales of product A by 25% on the last year’s volumes and maintained our profit margins.” They are also measurable (if we cannot measure them how will we know we are progressing?) They must be agreed within the account team and maybe even agreed with the customer. They must be realistic – after all, other people will be depending on our forecasts. Finally, they must have a time-scale. Those business objectives provide the strong disciplines that we need to know in order to understand whether or not we are succeeding.

The final level of objectives is the level of stage goals. We may say that we will achieve a result of X by the end of year 2 within the key account. If this is to happen, we need to be planning where we should be at important stages.

If the objective is to be selling five products to the customer by the end of next year and we’re selling two today, we probably need to plan to have three in place by this October, four in place by next March and five by next September. The stage goals make sure we are on target and allow us to solve problems before they become impossible to solve.

We have found that using these multi-level objectives helps to motivate each account team member, but can also help us significantly increase the amount and quality of business being done within these key accounts.

Strategies

If objectives show us where we are trying to go, strategies show us how we can plan to get there. Strategy is part of the long term plan. It is not too detailed. It focuses on ways of working, not the detail of what will happen in this or that sales call.

When setting these strategies we have found it useful to ask three question:

• What strategies do we need for this account?

• What should each strategy say?

• How do we communicate them so that each member of the team is committed to them and carries them out?

The Short Term Plan

It is important to think long term in account management, but there is a danger that we spend all our time analyzing and planning and never do anything! The short term plan keeps us active and effective.

The long term plan is concerned with why (objectives) and how (strategy). The short term plan focuses on who does what and when.

The timescale for the short term plan will vary from business to business, but many organizations find that a rolling three month plan reviewed monthly is very effective. This means that late in April you plan events for May, June and July. Late in May you plan for June, July and August, etc. The first month is usually in detail, the second two months are more in outline.

The short term plan should focus not only on matters that are very urgent, but also on those actions which are important but are not urgent. These might include developing more contacts in the account; introducing colleagues; gathering information, etc.

The short term plan helps ensure that the important things get done efficiently and effectively.

Traffic Lights

The fourth and final element of the model is the traffic lights.

This is a simple but powerful way of analyzing any customer situation.

• What are the factors that are in your favor? E.g. Product is approved, strong personal relationship – these are the green lights.

• What are the factors that are absolutely against you, that stop you achieving an objective? E.g. Kicked-off preferred list; operations manager swears not to use you until xyz improves – these are the red lights.

• What are the factors which could go either way? E.g. Change of Financial Director; they buy a new Company – these are the amber lights.

This simple approach has proved highly effective, even within our most sophisticated clients that needed an easy way of talking about the situation in their accounts.

How important is is having a strategy for each client? Well think of it as a road map which guides you to your chosen destination – would you consider going on a long journey without a map? Hopefully not – if you did, you might reach your chosen destination … eventually!