Entrepreneurs, How to Choose Key Accounts to Grow With!

How Do You Choose Key Accounts to Collaborate With?

The first key to building a strong key account program is to invest time to better understand your partner’s business. With over 50% of executive leaders feeling there must be a better way, I thought I’d give you several ideas to help you choose the right clients for key account success.  This week, I conclude with several questions and then begin moving to action.

Today, it is a very small world. By using many different tools, you can uncover information about how your customers run their business, where they’re going and how they plan to get there. These are all keys to succeeding with your key account program.

The way I look at key account customer is to ask yourself, “If this were a standalone business, would you stay in this business? For all the interesting information around about successful key account management, to me it comes down to this question.

Peter Drucker felt that the most effective leaders were those who do not waste their time, money, or people on projects that do not produce significant results. More CEOs fail today because they don’t know how to cancel projects.  Perhaps it’s because they feel there’s a limited number of opportunities and they’re afraid to lose out if they let them go by. My best clients are the ones who are better at evaluating opportunities and then look for way to mitigate risks when getting involved with them. Think back to the projects that have failed in your organization. How many times did they fail because you started late into the market? If you’re honest with yourself, very few projects fail because you’re late adopting a new business trends.

Most successful midmarket organizations would be better off developing an expansion strategy for their key account activities.  Now let’s see what questions might need to be asked to help create this business expansion strategy.

The question I ask clients is if they can identify all the key elements influencing success in both their and their clients business. Not just some of the elements, but all of them. If you look for all of them, you don’t stop at three or five, you continue doing more comprehensive research. You’re always turning up new opportunities to help your client grow.

Since key accounts require significance resources you should invest early resources into deciding how far you should go into the project. It has always been interesting to me that clients invest significant resources to determine what markets to go in, the new products they develop, or even the people they hire.  They don’t, however, invest the time required to keep and expand their current clients.

Most key accounts have been chosen because they were there. It was easier than looking for another one, or even maybe it was the company’s only account. When you look at current key accounts, how did you decide to provide them the additional resources needed to build out their business with you? Were you guided by your sales professional or project manager who said this client is going places?

This is not to say that those people don’t know what they are talking about, most times they have a very good view of the business from their own limited perspective. Sales people get paid to sell and barring a major problem, they just keep providing products and services as long as the client keeps buying.  How many times has a project manager seen their scope creep because someone in your organization has made promise that you cannot fulfill?

To have a better understanding of a key account, would you invest these critical resources with that client, if given a choice? The second part of the key account process is you are always given a choice on where to invest your resources. Take time to decide what your business will look like after you develop the key account. How scalable is the model you are developing? How many additional clients could use these capabilities you are developing? These questions help you decide if this is a great key account.

The final question you might want to consider is how does this key client define priorities and determine success? Does the potential client have a positive approach to collaborating with their suppliers and partners? Are you going to be part of their success or just another provider of a commodity product or service? I’ve seen many great organizations spend significant time and money to land a marquee account only discover they’re contribution is not a critical element to the organization’s long term success.  How much do you know about where the client is going?

Finally, do their goals fits well with your organization? I can think of one organization whose purchasing department’s goals did not align with where the organization was going. I watched as the overzealous purchasing department destroyed many key relationships just to save another penny per unit. Their compensation was tied to saving the company money. Over the years, the best suppliers who provided them the most innovative solutions were squeezed out by cheaper competitors. Ultimately, the business had several major recalls based on the quality of their key components, all delivered to meet the purchasing group’s cost reduction goals. You probably know the rest of the story.

How well do your clients represent the work you do for clients?  Take time to determine if this client is willing to help support your goals. In today’s buyer based economy, referrals and client testimonials are critical to winning new business. Is your client willing to help you grow? You best key accounts understand that their success comes from your ongoing success. Make sure that you both share these success criteria when deciding which accounts are better for your businesses growth.

We’ve covered several key questions to answer, but what’s the final key?  To me, a key account must be willing to learn and grow with you. You’re providing them the best products and services in the market, are they willing to use them?  Most of the key accounts I work with are in competitive global markets. If you can help them grow, are they willing to help you grow?

I’ve learned  time kills all deals. It is critical that your clients have a bias towards action. You can see it when you share ideas and when they return your calls. They put a high value on what you bring and you help them continue to grow and prosper.  Look for clues in how they interact with you. It’s funny, we almost always see the early warning clues, but we are unwilling to look at them. Because of this, many key account programs are doomed from the start, aren’t they?

If you work through this process you can see the power that a fully engaged key account program can provide you and your business. See you next week.

Photos compliments of Stuart Miles at FreeDigitalphotos.Net