Key Account Management <ul><li>Peter Cheverton </li></ul>slides by r c bhardwaj
Key Account Definitions & their Limitations slides by r c bhardwaj
The Big Ones <ul><li>What about tomorrow? </li></ul><ul><li>Do sales statistics determine your decisions? </li></ul>slides...
The ones you must not lose <ul><li>You will do anything to keep them happy, even it kills you? </li></ul>slides by r c bha...
The ones your staff focus on <ul><li>So, do they ignore the rest? </li></ul>slides by r c bhardwaj
The ones where extra effort brings extra income <ul><li>Define return..? And how many times you can do this..? </li></ul>s...
The ones demanding more <ul><li>Every industry has its loud mouths…does that make them important..? </li></ul>slides by r ...
The ones that will take the business where u want to go <ul><li>Perhaps the best..but r u certain? </li></ul><ul><li>Do yo...
Business Strategies or  Sales Strategies slides by r c bhardwaj
BUSINESS STRATEGIES <ul><li>BUSINESS OBJECTIVES </li></ul><ul><li>MARKET OPPORTUNITY </li></ul><ul><li>BUSINESS RESOURCES ...
Business Objectives <ul><li>Where u r trying to get to </li></ul><ul><li>What sort of business u want to have in future </...
Market opportunity <ul><li>Consideration of forces that will help and hinder..among the latter are the competitors </li></...
Business resources <ul><li>Things that will support or constraint your progress..yr capabilities, production, logistics, m...
So balance <ul><li>Will shift continually as the market changes </li></ul><ul><li>Managing future must be continual proces...
KAM <ul><li>Building relationships and it takes time..! </li></ul><ul><li>Sales targets can’t be achieved only thru KAM..!...
Assessing the opportunity <ul><li>S ----Social Changes </li></ul><ul><li>L ----Legislative Changes </li></ul><ul><li>E ---...
Michael E Porter’s Model of 5 determinants of industry profits <ul><li>Competitors Rivalry </li></ul><ul><li>Bargaining po...
Threat of new entrants <ul><li>Attracted by the profitability or growth of the market </li></ul>slides by r c bhardwaj
Threat of Substitute products or services <ul><li>Replacing your offer…? </li></ul><ul><li>Thru new technology..? </li></u...
Bargaining power of customer <ul><li>Swings of supply – demand….! </li></ul><ul><li>Amalgamations and consequent increase ...
The bargaining power of supplier <ul><li>Thru provision of increasingly specialist high value but unique services.. </li><...
Sales Strategies based on market position slides by r c bhardwaj
Established position <ul><li>Retention thru raising barriers to entry against those competitive forces </li></ul>slides by...
Potential entrant into a growth market <ul><li>Growth thru finding ways to overcome barriers to entry </li></ul><ul><li>… ...
KAM is a means to gaining competitive advantage slides by r c bhardwaj
Time <ul><li>Times Change very fast…… </li></ul><ul><li>Market dynamics change very fast…. </li></ul><ul><li>Be aware..or ...
Customers Snap..! <ul><li>They snap when a new supplier appears </li></ul>slides by r c bhardwaj
The greatest value and so the greatest impulse for change is usually to be found closest to the end-user slides by r c bha...
Long term competitive advantage..? KAM is a means to Key Supplier Status slides by r c bhardwaj
Sanity Check Summary..! slides by r c bhardwaj
Retention in a competitive market slides by r c bhardwaj Market opportunity Resources Can barriers be built..? Do u have c...
Entry in a growth environment slides by r c bhardwaj Can u break thru barriers.? Is the team sufficient..? Do u have compe...
Manage global accounts slides by r c bhardwaj Do they exists..? Are you globally oriented..? Do they want a global service...
Uniform approach from a multi business company slides by r c bhardwaj Do customers want it..? Can you focus different busi...
Create a customer focused business, driven by key accounts slides by r c bhardwaj Are customer needs clear..? Can the busi...
So what will KAM will feel like..? <ul><li>To manage the future </li></ul><ul><li>To identify customers that will help us ...
<ul><li>To develop intimacy with customer needs and values </li></ul><ul><li>To gain competitive advantage </li></ul><ul><...
<ul><li>To identify customer focused activities and commit to them </li></ul><ul><li>To direct and drive the business, par...
Developing the relationship slides by r c bhardwaj
Key account relationship high Low Strategic intent of seller *  Pre KAM *  Early KAM *  Mid KAM *  Partnership KAM *  Syne...
Pre KAM Stage Selling Company Buying Co Pre KAM Stage..McDonald, Millman and Rogers, 1996 slides by r c bhardwaj Directors...
Pre KAM Stage Selling Company Buying Co Pre KAM Stage..McDonald, Millman and Rogers, 1996 slides by r c bhardwaj Directors...
Possible Characteristics of Pre KAM Stage <ul><li>Simple, one to one contact </li></ul><ul><li>Supplier presentations focu...
<ul><li>Customer may require trials, perhaps at suppliers cost </li></ul><ul><li>Buyer may act as a gatekeeper, denying ac...
Early KAM Stage Marketing Administration Operations Board Marketing Administration Operations Board Selling Co Buying Co K...
Early KAM Stage <ul><li>Principal Contact between 2 people.. …salesperson and buyer </li></ul><ul><li>Relationship may be ...
<ul><li>Price discussions dominate </li></ul><ul><li>……… buyer focuses on costs </li></ul><ul><li>Supplier focuses on incr...
Mid KAM Stage Selling Company Buying Co Pre KAM Stage..McDonald, Millman and Rogers, 1996 slides by r c bhardwaj Directors...
Mid KAM Stage <ul><li>Contacts start to facilitate other contacts thru mutual desire to increase understanding of customer...
Partnership KAM Stage R&D R&D Administration Administratio9n Operations Operations Outbound logistics Outbound logistics B...
Partnership KAM <ul><li>Key Supplier Status is awarded </li></ul><ul><li>Relationships are based on trusts </li></ul><ul><...
<ul><li>Clear vendor ratings and performance measures </li></ul><ul><li>Possible contractual arrangements </li></ul><ul><l...
<ul><li>Supplier’s main contact focused on developing supplier’s capabilities </li></ul><ul><li>Supplier’s total organizat...
Synergistic KAM Stage KAMgr Main contact buyer Selling Co Buying Co slides by r c bhardwaj
Synergistic KAM Stage <ul><li>Joint R&D </li></ul><ul><li>Transparent costings and margins </li></ul><ul><li>Focus on inno...
<ul><li>Shared communication networks </li></ul><ul><li>Shared resources </li></ul><ul><li>Exit barriers in place </li></u...
frustration <ul><li>Developing a relationship requires mutual intent…. </li></ul><ul><li>Any imbalance will result in frus...
KAM Profitability <ul><li>Costs of KAM must be understood and measured </li></ul><ul><li>Individual customer profitability...
<ul><li>Costs of winning new customers is almost always higher than u may think..retaining customers is often a more profi...
Customer’s Life time value <ul><li>It is true measure of their worth </li></ul><ul><li>It is the life time value that coun...
<ul><li>Suspect </li></ul><ul><li>Prospect </li></ul><ul><li>Customer </li></ul><ul><li>Client </li></ul><ul><li>Supporter...
Purchasing Professionals slides by r c bhardwaj
Need to understand..! <ul><li>Supply chain management </li></ul><ul><li>Supply side management </li></ul><ul><li>Spend int...
In the Past <ul><li>Price dominates </li></ul><ul><li>Play the field and maintain choices </li></ul><ul><li>Pressure </li>...
In the future..? <ul><li>Value dominates </li></ul><ul><li>Supply base optimization </li></ul><ul><li>Information </li></u...
Supplier Positioning Models <ul><li>Where to spend the purchasing function’s time and effort </li></ul><ul><li>What sort o...
Supplier Positioning Models <ul><li>The risk / significance /spend model </li></ul><ul><li>The risk / significance / value...
RISK/SIGNIFICANCE/SPEND MODEL LOW HIGH LOW HIGH RELATIVE SPEND E C N A C I F F I N G I S / K S I R slides by r c bhardwaj ...
DEFINING THE AXES <ul><li>RISK/SIGNIFICANCE – how dependent are u on these suppliers or groups of suppliers </li></ul><ul>...
Why these labels..? <ul><li>The two axes can be seen to reflect the balance of power between the supplier and customer – s...
SUPPLIER POSITIONING..AN EXAMPLE FOR US LOW HIGH LOW HIGH RELATIVE SPEND E C N A C I F F I N G I S / K S I R slides by r c...
<ul><li>Most time should be spent with suppliers in the top right quadrant..this is where max money is spent that is of im...
SHIFT OF TIME AND EFFORT LOW HIGH LOW HIGH RELATIVE SPEND E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Strat...
slides by r c bhardwaj
Strategic Partner <ul><li>This is where the supplier is welcomed with open arms </li></ul><ul><li>Demand for more contact ...
Tactical Made easy <ul><li>There r plenty of fish in this sea..say stationery suppliers..and the total spend is not huge… ...
So who is the key supplier? <ul><li>Behave appropriately is u r seen in tactical made easy box </li></ul><ul><li>Don’t for...
Measuring Value <ul><li>Buy a good bed or spend half yr life only on yr bed….! </li></ul>slides by r c bhardwaj
Summarizing Value <ul><li>Value in use is a result of experience </li></ul><ul><li>Value in terms of price, cost or value…...
Risk/significance/value model LOW HIGH LOW HIGH Total value E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Man...
Managed Supplier <ul><li>Under close scrutiny </li></ul><ul><li>Managed to deliver more value </li></ul><ul><li>Access to ...
Partnered Supplier <ul><li>This suggests open doors and even books is value is the issue at stake and not costs and prices...
Welcome supplier <ul><li>Opportunity for the supplier to win more business..the door is open..and learn to use this privil...
Arm’s length <ul><li>U will be called upon only in times of need </li></ul><ul><li>Don’t despair…. </li></ul><ul><li>U can...
Measuring trust <ul><li>Trust model is far more subjective… </li></ul><ul><li>This model does not measure trust but recogn...
Risk/significance/trust model <ul><li>Aim to win trust and confidence before trying to prove your significance </li></ul>s...
Risk/significance/trust model LOW HIGH LOW HIGH Trust/Confidence E C N A C I F F I N G I S / K S I R slides by r c bhardwa...
Supply base optimization <ul><li>Spend mapping and supplier positioning is the result of the customers’ desire to manage t...
Reducing suppliers <ul><li>Supplier rationalization..is the key word….and its horror for the suppliers </li></ul><ul><li>Q...
Questions…! <ul><li>Why are they reducing suppliers? </li></ul><ul><li>What are the target outcomes? Final nos, specific p...
<ul><li>Will they be selecting in or selecting out..? </li></ul><ul><li>How do we stand out now..? </li></ul><ul><li>What ...
Becoming A Strategic Supplier slides by r c bhardwaj
Business Strategic Questions slides by r c bhardwaj Questions Issues Model What to sell and  Where? Products, markets and ...
The Ansoff Model EXISTS NEW NEW EXISTS PRODUCTS M A R K E T S slides by r c bhardwaj Market Penetration New Product Develo...
ANSOFF MODEL slides by r c bhardwaj SELL MORE OF THE EXISTING PRODUCTS INTO EXISTING MARKETS MARKET PENETRATION Sell exist...
Market Penetration <ul><li>Its safest strategy as u don’t have 100 % market share </li></ul><ul><li>Risks increases from p...
Risks reduction in Penetration <ul><li>Market Research </li></ul><ul><li>Market testing </li></ul><ul><li>JV with experien...
Market Extension <ul><li>Information on market size and dynamics, distribution channels, pricing, consumer trends – all th...
New Product Development <ul><li>The main issue is likely to be sharing of risk rather than price or delivery schedules..! ...
Diversification <ul><li>Risks are very significant..!!!!!!! </li></ul><ul><li>Minimize risk thru partnerships with key sup...
Porter’s Model <ul><li>Competitive advantage comes from </li></ul><ul><li>Being the lowest cost supplier </li></ul><ul><li...
Trick..!!!! <ul><li>Be lowest cost supplier and yet not let the customer know that..! </li></ul><ul><li>Will look upon to ...
Differentiation <ul><li>Customers that sees its route to success thru building points of difference from its competitors w...
Treacy-Weirsema’s value drivers slides by r c bhardwaj OPERATIONAL EFFICIENCY Federal Exp, McDonald,Dell,Wal-Mart PRODUCT ...
Operational Efficiency <ul><li>It is about doing what u do..well. It is about effective process, smooth mechanics and the ...
Product Leadership <ul><li>It is about producing the best, leading edge or market dominant products.. </li></ul><ul><li>Re...
Customer Intimacy <ul><li>It is the ability to identify with specific customer needs and match products and services accor...
Practical Applications of T-W slides by r c bhardwaj Value Driver Purchasing Focus Ideal Supplier Operational excellence L...
Preparing for KAM  slides by r c bhardwaj
Skills slides by r c bhardwaj strategic planning Business and marketing planning Financial understanding Team dynamics and...
Systems & Processes slides by r c bhardwaj Information systems : KA profitability, plans and data Operation systems : Fore...
Core of Knowledge Management Knowledge Management  Culture Disciplines Skills Systems slides by r c bhardwaj
Knowledge Management Responsibilities of the KAM Team insight use share Capture idea Make Available Enhance  performance R...
Key Ingredients for Success <ul><li>Clear business objectives given to all </li></ul><ul><li>A flat organization </li></ul...
Organization and Resources slides by r c bhardwaj
Make yr organization FLAT slides by r c bhardwaj
Make it happen..!!!! slides by r c bhardwaj
change <ul><li>Discontent is the first necessity of progress </li></ul><ul><li>Change in mind is greater than the costs of...
Critical Success Factors <ul><li>KAM must be a cross business process, supported at senior levels </li></ul><ul><li>All te...
<ul><li>5.KAM team must have the right skills to carry out customer-intimate role </li></ul><ul><li>6.Understand the dynam...
Identifying Key Accounts slides by r c bhardwaj
Segmentation <ul><li>Every customer is unique!!!!!!! </li></ul><ul><li>A market segment is a grouping of customers with si...
Benefits of Segmentation <ul><li>Enhanced understanding of market dynamics, competitor strengths and hence opportunities f...
<ul><li>A basis for structuring yr business </li></ul><ul><li>Manage marketing mix in a very customary focused way </li></...
Methods of Segmentation <ul><li>Market Mapping: identifying opportunities and levers </li></ul><ul><li>Who buys what,how,w...
Bases for segmentation..an eg. slides by r c bhardwaj Base Builders Consumers Size of purchase Large volumes, large pack s...
Marketing Plan SP SP SP KAP KAP KAP KAP Business Plan Hierachy Segment Plan Key Account Plan slides by r c bhardwaj
Identification & Selection Matrix LOW HIGH LOW HIGH RELATIVE STRENGTH CUSTOMERATTRACTIVENESS slides by r c bhardwaj Key De...
Key Account <ul><li>This is it..u want them and they like u but don’t relax..they are critical to your future.. </li></ul>...
Key Development Account <ul><li>This is where it could be, if only u could improve yr performance in their eyes… </li></ul...
Maintenance Account <ul><li>This is hardest category </li></ul><ul><li>Customers good and loyal </li></ul><ul><li>Pull res...
Opportunistic Account <ul><li>These customers will be attended to as and when it suits yr priorities </li></ul><ul><li>Don...
INVESTMENT OF MONEY & EFFORT LOW HIGH LOW HIGH RELATIVE STRENGTH CUSTOMER ATTRACTIVENESS slides by r c bhardwaj Key Develo...
INVESTMENT PORTFOLIO <ul><li>Time and energy saved by more efficient means of handling maintenance and opportunistic accou...
<ul><li>Business with too many opportunistic account ,though very profitable, is heading nowhere in particular..It is all ...
Customer attractiveness factors slides by r c bhardwaj SIZE:  VVOLUME,VALUE, PROFIT,OPPORTUNITY GROWTH POTENTIAL :VOLUME,V...
Relative strength factors..from customer point of view! slides by r c bhardwaj PRICE SERVICE QUALITY SPEED OF RESPONSE REL...
Customer Attractive Factors: CAF’s Average score : Total of all scores divided by no. of customers rated..contd. slides by...
Remarks: <ul><li>Enter chosen customers </li></ul><ul><li>Select say 6 factors </li></ul><ul><li>Enter a score of 1-10 for...
Relative Strength vs Competition suppliers you Complete 1 table for each customer slides by r c bhardwaj Customer: Critica...
Identification & Selection Matrix LOW HIGH LOW HIGH RELATIVE STRENGTH CUSTOMERATTRACTIVENESS Contd… slides by r c bhardwaj...
THE LAST TABLE <ul><li>USING LAST 2 TABLES, U CAN PLACE EACH CUSTOMER ON THE MATRIX AS IN LAST SLIDE </li></ul><ul><li>IF ...
<ul><li>TO identify which of the two use results from the table relative strength vs. competition. </li></ul><ul><li>Where...
<ul><li>Entry Strategy </li></ul>slides by r c bhardwaj
Customers decision making process ! <ul><li>Whom to talk? </li></ul><ul><li>Do we have the right strategy? </li></ul>slide...
Sales/buying process slides by r c bhardwaj Business needs Personal Needs Organizational decision-making A Need exists Wha...
The Consensus DMU <ul><li>Decision made by some process of democracy…ideally all members agree or vote </li></ul><ul><li>E...
The Consultative DMU <ul><li>Appointed decision maker will make the decision based on the views of the key influencers of ...
Influencing thru acceptance slides by r c bhardwaj
Adopter’s curve:influencing thru acceptance slides by r c bhardwaj innovators 2.5 % Early adopters 13.5 % Early majority 3...
Innovators & Early Adopters <ul><li>Easy to sell </li></ul><ul><li>They like novelty and the words risk,experiment,trial a...
Late majority and laggards <ul><li>Much harder to sell </li></ul><ul><li>They want evidence and proof </li></ul><ul><li>Wi...
The early majority <ul><li>Will come knocking at you once the idea or product is fairly well established! </li></ul><ul><l...
Levels of seniority <ul><li>Senior management – commitment </li></ul><ul><li>Middle management – relationship management;e...
Upcoming SlideShare
Loading in...5
×

Key account management peter cheverton

8,652

Published on

Published in: Business

Key account management peter cheverton

  1. 1. Key Account Management <ul><li>Peter Cheverton </li></ul>slides by r c bhardwaj
  2. 2. Key Account Definitions & their Limitations slides by r c bhardwaj
  3. 3. The Big Ones <ul><li>What about tomorrow? </li></ul><ul><li>Do sales statistics determine your decisions? </li></ul>slides by r c bhardwaj
  4. 4. The ones you must not lose <ul><li>You will do anything to keep them happy, even it kills you? </li></ul>slides by r c bhardwaj
  5. 5. The ones your staff focus on <ul><li>So, do they ignore the rest? </li></ul>slides by r c bhardwaj
  6. 6. The ones where extra effort brings extra income <ul><li>Define return..? And how many times you can do this..? </li></ul>slides by r c bhardwaj
  7. 7. The ones demanding more <ul><li>Every industry has its loud mouths…does that make them important..? </li></ul>slides by r c bhardwaj
  8. 8. The ones that will take the business where u want to go <ul><li>Perhaps the best..but r u certain? </li></ul><ul><li>Do you know…? </li></ul><ul><li>The future is never clear….! </li></ul>slides by r c bhardwaj
  9. 9. Business Strategies or Sales Strategies slides by r c bhardwaj
  10. 10. BUSINESS STRATEGIES <ul><li>BUSINESS OBJECTIVES </li></ul><ul><li>MARKET OPPORTUNITY </li></ul><ul><li>BUSINESS RESOURCES </li></ul>slides by r c bhardwaj
  11. 11. Business Objectives <ul><li>Where u r trying to get to </li></ul><ul><li>What sort of business u want to have in future </li></ul>slides by r c bhardwaj
  12. 12. Market opportunity <ul><li>Consideration of forces that will help and hinder..among the latter are the competitors </li></ul><ul><li>Among the former are customers that will help you get to where u want to be </li></ul>slides by r c bhardwaj
  13. 13. Business resources <ul><li>Things that will support or constraint your progress..yr capabilities, production, logistics, money and yr people </li></ul>slides by r c bhardwaj
  14. 14. So balance <ul><li>Will shift continually as the market changes </li></ul><ul><li>Managing future must be continual process of analysis, reassessment and change </li></ul>slides by r c bhardwaj
  15. 15. KAM <ul><li>Building relationships and it takes time..! </li></ul><ul><li>Sales targets can’t be achieved only thru KAM..! </li></ul><ul><li>Don’t compromise yr future by abusing KAM..! </li></ul>slides by r c bhardwaj
  16. 16. Assessing the opportunity <ul><li>S ----Social Changes </li></ul><ul><li>L ----Legislative Changes </li></ul><ul><li>E ----Economic Changes </li></ul><ul><li>P ----Political Changes </li></ul><ul><li>T ----Technological Changes </li></ul><ul><li>SLEPT </li></ul>slides by r c bhardwaj
  17. 17. Michael E Porter’s Model of 5 determinants of industry profits <ul><li>Competitors Rivalry </li></ul><ul><li>Bargaining power of supplier </li></ul><ul><li>Bargaining power of customer </li></ul><ul><li>Threat of new entrants </li></ul><ul><li>Threat of substitute products or services </li></ul>slides by r c bhardwaj
  18. 18. Threat of new entrants <ul><li>Attracted by the profitability or growth of the market </li></ul>slides by r c bhardwaj
  19. 19. Threat of Substitute products or services <ul><li>Replacing your offer…? </li></ul><ul><li>Thru new technology..? </li></ul><ul><li>Lower cost alternative..? </li></ul><ul><li>Simpler solution..? </li></ul><ul><li>Will it or wont it..? </li></ul>slides by r c bhardwaj
  20. 20. Bargaining power of customer <ul><li>Swings of supply – demand….! </li></ul><ul><li>Amalgamations and consequent increase of their buying power..! </li></ul>slides by r c bhardwaj
  21. 21. The bargaining power of supplier <ul><li>Thru provision of increasingly specialist high value but unique services.. </li></ul><ul><li>Again..swings of supply -demand </li></ul>slides by r c bhardwaj
  22. 22. Sales Strategies based on market position slides by r c bhardwaj
  23. 23. Established position <ul><li>Retention thru raising barriers to entry against those competitive forces </li></ul>slides by r c bhardwaj
  24. 24. Potential entrant into a growth market <ul><li>Growth thru finding ways to overcome barriers to entry </li></ul><ul><li>… .and so……….. </li></ul>slides by r c bhardwaj
  25. 25. KAM is a means to gaining competitive advantage slides by r c bhardwaj
  26. 26. Time <ul><li>Times Change very fast…… </li></ul><ul><li>Market dynamics change very fast…. </li></ul><ul><li>Be aware..or else u will be out..! </li></ul><ul><li>Customer dissatisfaction..very deadly….! </li></ul>slides by r c bhardwaj
  27. 27. Customers Snap..! <ul><li>They snap when a new supplier appears </li></ul>slides by r c bhardwaj
  28. 28. The greatest value and so the greatest impulse for change is usually to be found closest to the end-user slides by r c bhardwaj
  29. 29. Long term competitive advantage..? KAM is a means to Key Supplier Status slides by r c bhardwaj
  30. 30. Sanity Check Summary..! slides by r c bhardwaj
  31. 31. Retention in a competitive market slides by r c bhardwaj Market opportunity Resources Can barriers be built..? Do u have competitor advantage ..? Is it the right team..? Can u secure key supplier status..? Is it deployed correctly.? With which customers..?
  32. 32. Entry in a growth environment slides by r c bhardwaj Can u break thru barriers.? Is the team sufficient..? Do u have competitive advantage..? Is it deployed correctly..? With which customers..?
  33. 33. Manage global accounts slides by r c bhardwaj Do they exists..? Are you globally oriented..? Do they want a global service..? Can you globally operate..? Do they operate that way..?
  34. 34. Uniform approach from a multi business company slides by r c bhardwaj Do customers want it..? Can you focus different business..? Which ones..?
  35. 35. Create a customer focused business, driven by key accounts slides by r c bhardwaj Are customer needs clear..? Can the business cope..? Are they sufficiently long term..? Are support functions responsive..? Can they be segmented..?
  36. 36. So what will KAM will feel like..? <ul><li>To manage the future </li></ul><ul><li>To identify customers that will help us achieve our objectives </li></ul><ul><li>To retain and grow customers against competitive forces </li></ul><ul><li>To gain entry to new customers </li></ul><ul><li>To gain entry to new customers </li></ul>slides by r c bhardwaj
  37. 37. <ul><li>To develop intimacy with customer needs and values </li></ul><ul><li>To gain competitive advantage </li></ul><ul><li>To increase long term customer loyalty </li></ul><ul><li>To secure key supplier status </li></ul><ul><li>To balance business objectives,market opportunity and resources </li></ul><ul><li>To allocate and deploy resources, particularly people </li></ul>slides by r c bhardwaj
  38. 38. <ul><li>To identify customer focused activities and commit to them </li></ul><ul><li>To direct and drive the business, particularly support systems </li></ul><ul><li>To secure a profitable future </li></ul><ul><li>KAM will change the nature of the relationship with customers, both in its complexity and its purposes </li></ul>slides by r c bhardwaj
  39. 39. Developing the relationship slides by r c bhardwaj
  40. 40. Key account relationship high Low Strategic intent of seller * Pre KAM * Early KAM * Mid KAM * Partnership KAM * Synergetic KAM Low High Strategic Intent of Buyer Key account relationship development model..Millman and Wilson’94 slides by r c bhardwaj
  41. 41. Pre KAM Stage Selling Company Buying Co Pre KAM Stage..McDonald, Millman and Rogers, 1996 slides by r c bhardwaj Directors Directors Managers Key account Manager Main contact ‘Buyer’ Managers Specialists Specialists Clerks Clerks Operators Operators
  42. 42. Pre KAM Stage Selling Company Buying Co Pre KAM Stage..McDonald, Millman and Rogers, 1996 slides by r c bhardwaj Directors Directors Managers Key account Manager Main contact ‘Buyer’ Managers Specialists Specialists Clerks Clerks Operators Operators
  43. 43. Possible Characteristics of Pre KAM Stage <ul><li>Simple, one to one contact </li></ul><ul><li>Supplier presentations focus on their own issues and concerns </li></ul><ul><li>Response to customer enquiries is yes or no </li></ul><ul><li>Seller assessing volume potential </li></ul><ul><li>Customer assess competence and competitiveness..latter on price </li></ul>slides by r c bhardwaj
  44. 44. <ul><li>Customer may require trials, perhaps at suppliers cost </li></ul><ul><li>Buyer may act as a gatekeeper, denying access to other contacts </li></ul>slides by r c bhardwaj
  45. 45. Early KAM Stage Marketing Administration Operations Board Marketing Administration Operations Board Selling Co Buying Co Key Account Manager Main Contact Buyer slides by r c bhardwaj
  46. 46. Early KAM Stage <ul><li>Principal Contact between 2 people.. …salesperson and buyer </li></ul><ul><li>Relationship may be competitive, each seeking to gain advantage </li></ul><ul><li>At worst the relationship may be confrontational </li></ul><ul><li>Buyer may see any attempt as threat to their position and power </li></ul>slides by r c bhardwaj
  47. 47. <ul><li>Price discussions dominate </li></ul><ul><li>……… buyer focuses on costs </li></ul><ul><li>Supplier focuses on increased volume </li></ul><ul><li>Suppliers judged on unspecified performance criteria </li></ul><ul><li>Disputes can lead to long term breaks in supply </li></ul>slides by r c bhardwaj
  48. 48. Mid KAM Stage Selling Company Buying Co Pre KAM Stage..McDonald, Millman and Rogers, 1996 slides by r c bhardwaj Directors Directors Managers Key account Manager and Main contact ‘Buyer’ Managers Specialists Specialists Clerks Clerks Operators Operators
  49. 49. Mid KAM Stage <ul><li>Contacts start to facilitate other contacts thru mutual desire to increase understanding of customer’s markets and processes </li></ul><ul><li>Increase in time spent on meetings </li></ul><ul><li>Increased trusts and openness developing </li></ul><ul><li>Links become informal </li></ul><ul><li>Stage for mishaps..expect setbacks..lots to do for everyone </li></ul>slides by r c bhardwaj
  50. 50. Partnership KAM Stage R&D R&D Administration Administratio9n Operations Operations Outbound logistics Outbound logistics Board Board Key Account manager Main contact Buyer Selling CO Buying Co slides by r c bhardwaj
  51. 51. Partnership KAM <ul><li>Key Supplier Status is awarded </li></ul><ul><li>Relationships are based on trusts </li></ul><ul><li>Information is shared </li></ul><ul><li>Access to people is facilitated </li></ul><ul><li>Pricing is stable </li></ul><ul><li>Customers get new ideas first </li></ul><ul><li>Continuous information is expected </li></ul>slides by r c bhardwaj
  52. 52. <ul><li>Clear vendor ratings and performance measures </li></ul><ul><li>Possible contractual arrangements </li></ul><ul><li>Value is sought thru integrated business processes </li></ul><ul><li>Focus on customer’s markets </li></ul><ul><li>Step outs are permitted </li></ul><ul><li>KA Manager role is one of coordination and orchestration </li></ul>slides by r c bhardwaj
  53. 53. <ul><li>Supplier’s main contact focused on developing supplier’s capabilities </li></ul><ul><li>Supplier’s total organization is focused on customer satisfaction thru supply chain management </li></ul>slides by r c bhardwaj
  54. 54. Synergistic KAM Stage KAMgr Main contact buyer Selling Co Buying Co slides by r c bhardwaj
  55. 55. Synergistic KAM Stage <ul><li>Joint R&D </li></ul><ul><li>Transparent costings and margins </li></ul><ul><li>Focus on innovation </li></ul><ul><li>Collaborative approach to customer’s markets and end users </li></ul><ul><li>Joint business plans </li></ul><ul><li>Joint marketing plans </li></ul>slides by r c bhardwaj
  56. 56. <ul><li>Shared communication networks </li></ul><ul><li>Shared resources </li></ul><ul><li>Exit barriers in place </li></ul><ul><li>Focus teams involve members of both companies, led by either buyer or supplier </li></ul>slides by r c bhardwaj
  57. 57. frustration <ul><li>Developing a relationship requires mutual intent…. </li></ul><ul><li>Any imbalance will result in frustration </li></ul><ul><li>Supplier’s frustration leads to undue pressure on the customer with terminal consequences </li></ul><ul><li>Buyers frustration results in seeking new supplier </li></ul>slides by r c bhardwaj
  58. 58. KAM Profitability <ul><li>Costs of KAM must be understood and measured </li></ul><ul><li>Individual customer profitability must be measured </li></ul><ul><li>Throwing resources at the customer inappropriate to the buyer’s strategic intent is a sure way to reduce customer profitability </li></ul>slides by r c bhardwaj
  59. 59. <ul><li>Costs of winning new customers is almost always higher than u may think..retaining customers is often a more profitable activity </li></ul><ul><li>A business’s largest customers, by volume, are not necessary its most profitable </li></ul><ul><li>In context os supplier reduction plans cost of retaining existing customers is higher </li></ul><ul><li>Growth with retained customers offers increased profits over time </li></ul>slides by r c bhardwaj
  60. 60. Customer’s Life time value <ul><li>It is true measure of their worth </li></ul><ul><li>It is the life time value that counts, not this year’s results </li></ul><ul><li>KAM is thus a process of viewing the future </li></ul>slides by r c bhardwaj
  61. 61. <ul><li>Suspect </li></ul><ul><li>Prospect </li></ul><ul><li>Customer </li></ul><ul><li>Client </li></ul><ul><li>Supporter </li></ul><ul><li>Advocate </li></ul><ul><li>Partner </li></ul><ul><li>From suspect to Partner </li></ul><ul><li>..a relationship ladder </li></ul>slides by r c bhardwaj
  62. 62. Purchasing Professionals slides by r c bhardwaj
  63. 63. Need to understand..! <ul><li>Supply chain management </li></ul><ul><li>Supply side management </li></ul><ul><li>Spend intelligence </li></ul><ul><li>Purchasing strategy </li></ul><ul><li>Supplier positioning and key supplier status </li></ul><ul><li>Supply base optimization and rationalization </li></ul>slides by r c bhardwaj
  64. 64. In the Past <ul><li>Price dominates </li></ul><ul><li>Play the field and maintain choices </li></ul><ul><li>Pressure </li></ul><ul><li>Adversarial </li></ul><ul><li>Transactional efficiency </li></ul>slides by r c bhardwaj
  65. 65. In the future..? <ul><li>Value dominates </li></ul><ul><li>Supply base optimization </li></ul><ul><li>Information </li></ul><ul><li>Alliance </li></ul><ul><li>Supply chain effectiveness </li></ul><ul><li>Or is there a balance..? </li></ul><ul><li>Changing role..from buyer to supply side buyer </li></ul>slides by r c bhardwaj
  66. 66. Supplier Positioning Models <ul><li>Where to spend the purchasing function’s time and effort </li></ul><ul><li>What sort of relationship should be established with different suppliers </li></ul><ul><li>What sort of activities should be worked on with different suppliers </li></ul><ul><li>Identifying key suppliers </li></ul>slides by r c bhardwaj
  67. 67. Supplier Positioning Models <ul><li>The risk / significance /spend model </li></ul><ul><li>The risk / significance / value model </li></ul><ul><li>The risk / significance / trust model </li></ul><ul><li>SUPPLIER SHOULD KNOW HOW THEY ARE THEMSELVES REGARDED </li></ul>slides by r c bhardwaj
  68. 68. RISK/SIGNIFICANCE/SPEND MODEL LOW HIGH LOW HIGH RELATIVE SPEND E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Strategic Security Strategic Partner Tactical Made Easy Tactical Profit
  69. 69. DEFINING THE AXES <ul><li>RISK/SIGNIFICANCE – how dependent are u on these suppliers or groups of suppliers </li></ul><ul><li>RELATIVE SPEND- how much do you spend compared to other suppliers or groups of suppliers? </li></ul>slides by r c bhardwaj
  70. 70. Why these labels..? <ul><li>The two axes can be seen to reflect the balance of power between the supplier and customer – significance reflects supplier power, with spend as a marker of potential buyer power </li></ul>slides by r c bhardwaj
  71. 71. SUPPLIER POSITIONING..AN EXAMPLE FOR US LOW HIGH LOW HIGH RELATIVE SPEND E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Strategic Security TV LICENCE Strategic Partner Life insurance Tactical Made Easy Baked Beans Tactical Profit 2 nd Hand Car
  72. 72. <ul><li>Most time should be spent with suppliers in the top right quadrant..this is where max money is spent that is of important to the purchaser….and not spend too much time on bottom left quadrant </li></ul><ul><li>Often as much as 80% of purchasing time is spent on simple transactional activities, with suppliers that account for as little as 20 % of the spend…that has to be wrong..! </li></ul>slides by r c bhardwaj
  73. 73. SHIFT OF TIME AND EFFORT LOW HIGH LOW HIGH RELATIVE SPEND E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Strategic Security Strategic Partner Tactical Made Easy Tactical Profit
  74. 74. slides by r c bhardwaj
  75. 75. Strategic Partner <ul><li>This is where the supplier is welcomed with open arms </li></ul><ul><li>Demand for more contact comes from customer..a desire to meet senior executives to discuss long term issues… </li></ul><ul><li>Heavy demands from customers..lots of money at stake…. </li></ul>slides by r c bhardwaj
  76. 76. Tactical Made easy <ul><li>There r plenty of fish in this sea..say stationery suppliers..and the total spend is not huge… </li></ul><ul><li>What clever purchasers want here is an easy buy…not to spend too much time… </li></ul><ul><li>E- commerce the best means in this sector </li></ul><ul><li>Self regulation and self management reduces transactional costs significantly </li></ul>slides by r c bhardwaj
  77. 77. So who is the key supplier? <ul><li>Behave appropriately is u r seen in tactical made easy box </li></ul><ul><li>Don’t force complex relationship on the customer </li></ul><ul><li>Police yr own standards but don’t be pushy..! </li></ul><ul><li>Everything is relative..! </li></ul><ul><li>Customers perception is more important than facts..so don’t argue the facts….!!!!!!!!! </li></ul>slides by r c bhardwaj
  78. 78. Measuring Value <ul><li>Buy a good bed or spend half yr life only on yr bed….! </li></ul>slides by r c bhardwaj
  79. 79. Summarizing Value <ul><li>Value in use is a result of experience </li></ul><ul><li>Value in terms of price, cost or value…. </li></ul><ul><li>Help customer towards this more complicated measure of supplier performance..! </li></ul>slides by r c bhardwaj
  80. 80. Risk/significance/value model LOW HIGH LOW HIGH Total value E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Managed Supplier Partnered Supplier Arm’s Length supplier Welcome supplier
  81. 81. Managed Supplier <ul><li>Under close scrutiny </li></ul><ul><li>Managed to deliver more value </li></ul><ul><li>Access to customer controlled </li></ul><ul><li>Supplier should realize what ia at issue and start working on value prepositions </li></ul>slides by r c bhardwaj
  82. 82. Partnered Supplier <ul><li>This suggests open doors and even books is value is the issue at stake and not costs and prices </li></ul><ul><li>Don’t become complacent </li></ul>slides by r c bhardwaj
  83. 83. Welcome supplier <ul><li>Opportunity for the supplier to win more business..the door is open..and learn to use this privilege to the customer’s benefit—don’t abuse it..! </li></ul>slides by r c bhardwaj
  84. 84. Arm’s length <ul><li>U will be called upon only in times of need </li></ul><ul><li>Don’t despair…. </li></ul><ul><li>U can prove yr capability to get the customer out of the hole..a pretty high value outcome </li></ul>slides by r c bhardwaj
  85. 85. Measuring trust <ul><li>Trust model is far more subjective… </li></ul><ul><li>This model does not measure trust but recognize its importance </li></ul><ul><li>Level of trust and confidence is often underestimated by sales people </li></ul>slides by r c bhardwaj
  86. 86. Risk/significance/trust model <ul><li>Aim to win trust and confidence before trying to prove your significance </li></ul>slides by r c bhardwaj
  87. 87. Risk/significance/trust model LOW HIGH LOW HIGH Trust/Confidence E C N A C I F F I N G I S / K S I R slides by r c bhardwaj Problem supplier Promiscuous Partnered Supplier marriage Non-supplier Frigid Occasional supplier Flirting
  88. 88. Supply base optimization <ul><li>Spend mapping and supplier positioning is the result of the customers’ desire to manage their suppliers or supply base </li></ul><ul><li>In broad terms..it is </li></ul><ul><li>Which supplier will best help us..? </li></ul><ul><li>How must we help them..? </li></ul>slides by r c bhardwaj
  89. 89. Reducing suppliers <ul><li>Supplier rationalization..is the key word….and its horror for the suppliers </li></ul><ul><li>Questions..questions..questions….talk early </li></ul>slides by r c bhardwaj
  90. 90. Questions…! <ul><li>Why are they reducing suppliers? </li></ul><ul><li>What are the target outcomes? Final nos, specific performance, lower costs, better value..? </li></ul><ul><li>What standards will they apply? </li></ul><ul><li>What are the givens and what are the differentiations..? </li></ul><ul><li>What must a given supplier do to stand out? </li></ul>slides by r c bhardwaj
  91. 91. <ul><li>Will they be selecting in or selecting out..? </li></ul><ul><li>How do we stand out now..? </li></ul><ul><li>What must we do to meet yr standards? </li></ul><ul><li>How long do we have..? </li></ul><ul><li>What can we expect in return to meeting yr standards..? </li></ul><ul><li>Where will the competition lead to? </li></ul><ul><li>Are u increasing yr risk exposure? </li></ul><ul><li>Are they going to develop suppliers’ capabilities..? </li></ul>slides by r c bhardwaj
  92. 92. Becoming A Strategic Supplier slides by r c bhardwaj
  93. 93. Business Strategic Questions slides by r c bhardwaj Questions Issues Model What to sell and Where? Products, markets and risks the Ansoff Model Why will people buy? Competitive Advantage Michael Porter’s Competitive model What makes your business hum? Leading business system or driver Treacy and Weirsema’s Value drivers
  94. 94. The Ansoff Model EXISTS NEW NEW EXISTS PRODUCTS M A R K E T S slides by r c bhardwaj Market Penetration New Product Development Market extension Diversification
  95. 95. ANSOFF MODEL slides by r c bhardwaj SELL MORE OF THE EXISTING PRODUCTS INTO EXISTING MARKETS MARKET PENETRATION Sell existing products into new markets MARKET EXTENSION Sell new products into existing markets NEW PRODUCT DEVELOPMENT SELL NEW PRODUCTS INTO NEW MARKETS DIVERSIFICATION
  96. 96. Market Penetration <ul><li>Its safest strategy as u don’t have 100 % market share </li></ul><ul><li>Risks increases from penetration to extension, to NPD and then to Diversification </li></ul>slides by r c bhardwaj
  97. 97. Risks reduction in Penetration <ul><li>Market Research </li></ul><ul><li>Market testing </li></ul><ul><li>JV with experienced partners </li></ul><ul><li>Take on experienced staff, or training </li></ul><ul><li>Seek help from suppliers </li></ul>slides by r c bhardwaj
  98. 98. Market Extension <ul><li>Information on market size and dynamics, distribution channels, pricing, consumer trends – all these will help in extension venture </li></ul><ul><li>Get involved with customer’s market place </li></ul>slides by r c bhardwaj
  99. 99. New Product Development <ul><li>The main issue is likely to be sharing of risk rather than price or delivery schedules..! </li></ul><ul><li>How much effort to put into piece of work for a customer setting out on a new venture? </li></ul>slides by r c bhardwaj
  100. 100. Diversification <ul><li>Risks are very significant..!!!!!!! </li></ul><ul><li>Minimize risk thru partnerships with key suppliers </li></ul>slides by r c bhardwaj
  101. 101. Porter’s Model <ul><li>Competitive advantage comes from </li></ul><ul><li>Being the lowest cost supplier </li></ul><ul><li>Being a differentiated supplier </li></ul><ul><li>Success comes from the ability to focus the whole business whichever route is chosen!!!!!!!! </li></ul>slides by r c bhardwaj
  102. 102. Trick..!!!! <ul><li>Be lowest cost supplier and yet not let the customer know that..! </li></ul><ul><li>Will look upon to supply at lower costs than the competitors…costs of supply,purchasing,manufacture, distribution - the total supply chain and take appropriate action in each case… </li></ul>slides by r c bhardwaj
  103. 103. Differentiation <ul><li>Customers that sees its route to success thru building points of difference from its competitors will be seeking suppliers that can help them to achieve this.. </li></ul><ul><li>Suppliers to understand this differentiation to enable them to make an appropriate offer </li></ul>slides by r c bhardwaj
  104. 104. Treacy-Weirsema’s value drivers slides by r c bhardwaj OPERATIONAL EFFICIENCY Federal Exp, McDonald,Dell,Wal-Mart PRODUCT LEADERSHIP Microsoft, 3M, Merck, Intel, Nike CUSTOMER INTIMACY Kraft, Airborne Express
  105. 105. Operational Efficiency <ul><li>It is about doing what u do..well. It is about effective process, smooth mechanics and the efficiency with which the products are brought to the market. </li></ul><ul><li>It requires efficiencies of production, economics of scale, uniformity and conformance, accurate forecasting, slick distribution, fast response….. </li></ul>slides by r c bhardwaj
  106. 106. Product Leadership <ul><li>It is about producing the best, leading edge or market dominant products.. </li></ul><ul><li>Requires high levels of innovation and patent application </li></ul>slides by r c bhardwaj
  107. 107. Customer Intimacy <ul><li>It is the ability to identify with specific customer needs and match products and services accordingly </li></ul><ul><li>Act on the resultant knowledge at all levels of operation </li></ul>slides by r c bhardwaj
  108. 108. Practical Applications of T-W slides by r c bhardwaj Value Driver Purchasing Focus Ideal Supplier Operational excellence Logistics,inventory,e-commerce Excellent systems Product leadership Supplier partner ships, lead times Leading R&D, innovate Customer intimacy Supplier relationship working in chain Flexible,responsive,expert
  109. 109. Preparing for KAM slides by r c bhardwaj
  110. 110. Skills slides by r c bhardwaj strategic planning Business and marketing planning Financial understanding Team dynamics and team leadership requirements Team time management Managing innovations and creativity Communication network Strategic influencing Project management Analytical,monitoring and reporting skills Managing diversity and ambiguity Ability to help customers develop their own markets
  111. 111. Systems & Processes slides by r c bhardwaj Information systems : KA profitability, plans and data Operation systems : Forecasting,logistics,supply chain management, e-commerce Performance measurement Systems Communications Systems : Email, internal//external, knowledge management
  112. 112. Core of Knowledge Management Knowledge Management Culture Disciplines Skills Systems slides by r c bhardwaj
  113. 113. Knowledge Management Responsibilities of the KAM Team insight use share Capture idea Make Available Enhance performance Review Target Edit slides by r c bhardwaj
  114. 114. Key Ingredients for Success <ul><li>Clear business objectives given to all </li></ul><ul><li>A flat organization </li></ul><ul><li>Encouragement of breakthrough thinking </li></ul><ul><li>The drive to create value </li></ul><ul><li>Information technology </li></ul>slides by r c bhardwaj
  115. 115. Organization and Resources slides by r c bhardwaj
  116. 116. Make yr organization FLAT slides by r c bhardwaj
  117. 117. Make it happen..!!!! slides by r c bhardwaj
  118. 118. change <ul><li>Discontent is the first necessity of progress </li></ul><ul><li>Change in mind is greater than the costs of change…which could be..time,ego, status,etc rather than just money </li></ul>slides by r c bhardwaj
  119. 119. Critical Success Factors <ul><li>KAM must be a cross business process, supported at senior levels </li></ul><ul><li>All team members must understand and share the purpose and objectives of KAM </li></ul><ul><li>KAM team must understand why they are there </li></ul><ul><li>System for cross business communication </li></ul>slides by r c bhardwaj
  120. 120. <ul><li>5.KAM team must have the right skills to carry out customer-intimate role </li></ul><ul><li>6.Understand the dynamics of team working </li></ul><ul><li>7.Skills for project management </li></ul><ul><li>8.Attention to detail </li></ul><ul><li>9.System of measuring progress and benefits </li></ul><ul><li>10.Written and easily updateable KA plan </li></ul>slides by r c bhardwaj
  121. 121. Identifying Key Accounts slides by r c bhardwaj
  122. 122. Segmentation <ul><li>Every customer is unique!!!!!!! </li></ul><ul><li>A market segment is a grouping of customers with similar buying needs, attitudes and behaviour </li></ul>slides by r c bhardwaj
  123. 123. Benefits of Segmentation <ul><li>Enhanced understanding of market dynamics, competitor strengths and hence opportunities for competitive advantage </li></ul><ul><li>Greater understanding of the needs, attitudes and behaviour of customers </li></ul><ul><li>Better chance to develop yr capabilities of yr business </li></ul>slides by r c bhardwaj
  124. 124. <ul><li>A basis for structuring yr business </li></ul><ul><li>Manage marketing mix in a very customary focused way </li></ul><ul><li>Opportunity to add value,gain competitive advantage and build barriers to entry for competition or substitutes </li></ul><ul><li>Opportunity to sell at premium </li></ul><ul><li>Reduction of conflicts </li></ul>slides by r c bhardwaj
  125. 125. Methods of Segmentation <ul><li>Market Mapping: identifying opportunities and levers </li></ul><ul><li>Who buys what,how,when and where? </li></ul><ul><li>Selection of Segments and positioning thru marketing mix </li></ul>slides by r c bhardwaj
  126. 126. Bases for segmentation..an eg. slides by r c bhardwaj Base Builders Consumers Size of purchase Large volumes, large pack size Small volume,small pack size Frequency of purchase Weekly Annually Tech.Specification High Low Price elasticity Price sensitive Price insensitive Major influence on purchase Builders merchant staff Advertising and brand
  127. 127. Marketing Plan SP SP SP KAP KAP KAP KAP Business Plan Hierachy Segment Plan Key Account Plan slides by r c bhardwaj
  128. 128. Identification & Selection Matrix LOW HIGH LOW HIGH RELATIVE STRENGTH CUSTOMERATTRACTIVENESS slides by r c bhardwaj Key Development Account Key Account Opportunistic Account Maintenance Account
  129. 129. Key Account <ul><li>This is it..u want them and they like u but don’t relax..they are critical to your future.. </li></ul><ul><li>Remember…nothing recedes like success!! </li></ul>slides by r c bhardwaj
  130. 130. Key Development Account <ul><li>This is where it could be, if only u could improve yr performance in their eyes… </li></ul><ul><li>Most cos appoint jr sales persons to look after these customers..normally there is no progress…!!! </li></ul><ul><li>Cos try tele marketing with these customers! </li></ul><ul><li>Success comes from applier effort…till then experiment and allocate resources as test cases..! </li></ul>slides by r c bhardwaj
  131. 131. Maintenance Account <ul><li>This is hardest category </li></ul><ul><li>Customers good and loyal </li></ul><ul><li>Pull resources from these customers from such customers as it is needed elsewhere! </li></ul><ul><li>They will trap u in long term consuming commitments </li></ul><ul><li>Free yr time and yr teams time and sell the changes to yr maintenance customers positively,like asking distributors to service them </li></ul>slides by r c bhardwaj
  132. 132. Opportunistic Account <ul><li>These customers will be attended to as and when it suits yr priorities </li></ul><ul><li>Don’t make wild promises </li></ul><ul><li>Don’t treat them as nuisances </li></ul><ul><li>Be pleased with them as income is generated to meet yr KAM..! </li></ul>slides by r c bhardwaj
  133. 133. INVESTMENT OF MONEY & EFFORT LOW HIGH LOW HIGH RELATIVE STRENGTH CUSTOMER ATTRACTIVENESS slides by r c bhardwaj Key Development Account Key Account Opportunistic Account Maintenance Account
  134. 134. INVESTMENT PORTFOLIO <ul><li>Time and energy saved by more efficient means of handling maintenance and opportunistic accounts can be invested in future development, as can the revenue and profit from those customers! </li></ul><ul><li>Contd… </li></ul>slides by r c bhardwaj
  135. 135. <ul><li>Business with too many opportunistic account ,though very profitable, is heading nowhere in particular..It is all a question of investment and revenue </li></ul><ul><li>KAM must concern not only with star earners but with managing a portfolio of customers, balancing short term and long term income and balancing the resources and the returns, and in the process appreciating the dynamics of investment and return..! </li></ul>slides by r c bhardwaj
  136. 136. Customer attractiveness factors slides by r c bhardwaj SIZE: VVOLUME,VALUE, PROFIT,OPPORTUNITY GROWTH POTENTIAL :VOLUME,VALUE,PROFIT,OPPORTUNITY FINANCIAL STABILITY:WILL THEY BE THERE IN FUTURE EASE OF ACCESS : GEOGRAPHY,OPENNESS CLOSENESS OF EXISTING RELATIONSHIP STRATEGIC FIT :WILL THEY TAKE U WHERE U WANT TO BE? ARE THEY EARLY ADOPTERS – DO THEY PICK UP NEW IDEAS EASILY? DO THEY VALUE YR OFFER ?IS IT REKLEVANT TO THEIR NEEDS? LEVEL OF COMPETITION : LOW BEING ATTRACTIVE THEIR MARKET STANDING
  137. 137. Relative strength factors..from customer point of view! slides by r c bhardwaj PRICE SERVICE QUALITY SPEED OF RESPONSE RELATIONSHIPS & ATTITUDE TECHNICAL INNOVATION INVESTMENT IN THE INDUSTRY VALUE IN USE: SUPPLY CHAIN, ETC ATTITUDE TO EXCLUSIVITY ARRANGEMENTS LONG TERM SUSTAINABILITY TRUST AND CONFIDENCE
  138. 138. Customer Attractive Factors: CAF’s Average score : Total of all scores divided by no. of customers rated..contd. slides by r c bhardwaj customers Attractiveness Factor 1. 2. total
  139. 139. Remarks: <ul><li>Enter chosen customers </li></ul><ul><li>Select say 6 factors </li></ul><ul><li>Enter a score of 1-10 for each customer – the higher the score the better the customer meets yr aspirations </li></ul>slides by r c bhardwaj
  140. 140. Relative Strength vs Competition suppliers you Complete 1 table for each customer slides by r c bhardwaj Customer: Critical success Factor 1. 2. total
  141. 141. Identification & Selection Matrix LOW HIGH LOW HIGH RELATIVE STRENGTH CUSTOMERATTRACTIVENESS Contd… slides by r c bhardwaj Key Development Account Key Account Opportunistic Account Maintenance Account
  142. 142. THE LAST TABLE <ul><li>USING LAST 2 TABLES, U CAN PLACE EACH CUSTOMER ON THE MATRIX AS IN LAST SLIDE </li></ul><ul><li>IF A CUSTOMER SCORES HIGHER THAN AVERAGE SCORES THEY WILL BE IN UPPER TWO BOXES, ELSE IN LOWER BOXES </li></ul><ul><li>CONTD </li></ul>slides by r c bhardwaj
  143. 143. <ul><li>TO identify which of the two use results from the table relative strength vs. competition. </li></ul><ul><li>Where u score better then yr best competitor u will occupy the right hand box and the left hand box if otherwise </li></ul>slides by r c bhardwaj
  144. 144. <ul><li>Entry Strategy </li></ul>slides by r c bhardwaj
  145. 145. Customers decision making process ! <ul><li>Whom to talk? </li></ul><ul><li>Do we have the right strategy? </li></ul>slides by r c bhardwaj
  146. 146. Sales/buying process slides by r c bhardwaj Business needs Personal Needs Organizational decision-making A Need exists What are they? Understand style and values Who has the needs? Who decides? Options are considered Presenting benefits Matching style and values Influencing DMU’s Concerns are resolved Negotiation Rapport Giving DMU a means to decide
  147. 147. The Consensus DMU <ul><li>Decision made by some process of democracy…ideally all members agree or vote </li></ul><ul><li>Eg. Cooperative org,governments, voluntary groups,etc </li></ul>slides by r c bhardwaj
  148. 148. The Consultative DMU <ul><li>Appointed decision maker will make the decision based on the views of the key influencers of the DMU </li></ul>slides by r c bhardwaj
  149. 149. Influencing thru acceptance slides by r c bhardwaj
  150. 150. Adopter’s curve:influencing thru acceptance slides by r c bhardwaj innovators 2.5 % Early adopters 13.5 % Early majority 34 % Late majority 34 % laggards 16 %
  151. 151. Innovators & Early Adopters <ul><li>Easy to sell </li></ul><ul><li>They like novelty and the words risk,experiment,trial and leading edge are music to their ears </li></ul><ul><li>Don’t bore them with case studies..they just want to hear what’s new!!!! </li></ul>slides by r c bhardwaj
  152. 152. Late majority and laggards <ul><li>Much harder to sell </li></ul><ul><li>They want evidence and proof </li></ul><ul><li>Will see track records of success </li></ul>slides by r c bhardwaj
  153. 153. The early majority <ul><li>Will come knocking at you once the idea or product is fairly well established! </li></ul><ul><li>The model usage is that the ideas is to use acceptance of yr ideas, where u can find it, first as a point of entry and then as a base for approaching the next stage in the curve..which is a normal curve </li></ul>slides by r c bhardwaj
  154. 154. Levels of seniority <ul><li>Senior management – commitment </li></ul><ul><li>Middle management – relationship management;ensuring satisfaction </li></ul><ul><li>Junior management – meeting expectation </li></ul>slides by r c bhardwaj
  1. A particular slide catching your eye?

    Clipping is a handy way to collect important slides you want to go back to later.

×