INTERNATIONAL ACCOUNT MANAGEMENT

All rights reserved © 2001, D.P. Gosselin« Erasmus University, Rotterdam, 31.01. 2001, page n° 1 »

Drs. Ir. Derrick-Philippe GOSSELINDrs. Ir. Derrick-Philippe GOSSELIN

INTERNATIONAL ACCOUNT MANAGEMENT

INTERNATIONAL ACCOUNT MANAGEMENT

Erasmus University, RotterdamJanuary 31, 2001

Erasmus University, RotterdamJanuary 31, 2001

All rights reserved © 2001, D.P. Gosselin.« Rotterdam, Erasmus University, 31.01. 2001, page n° 2 »

CONTENTCONTENT

❏ Issues in Account Management

❏ Definitions of Account Management

❏ Why Account Management?

❏ Issues in International Account Management

❏ Key Success Factors: lessons from experience

❏ Conclusions






❏ Conclusions


CONTENTCONTENT






❏ Conclusions






❏ Conclusions


IssuesIssues

50% of all surveyed International and National

Account Programmes originally failed to meet their Company’s

Target Objectives

50% of all surveyed International and National

Account Programmes originally failed to meet their Company’s

Target Objectives

Source: Yankee group 1994


Reasons for Failure (1)Reasons for Failure (1)

1. Lack of Senior Management Support2. Too many Accounts3. No experience (Business Management/Culture)4. Account Management Concept not understood

in the Company: Sales versus Marketing versus account management

5. Seen as Elitist by other sales departments6. Company copies from competition without

understanding the requirements, culture, systems, resource allocation, functional interaction, etc…

1. Lack of Senior Management Support2. Too many Accounts3. No experience (Business Management/Culture)4. Account Management Concept not understood

in the Company: Sales versus Marketing versus account management

5. Seen as Elitist by other sales departments6. Company copies from competition without

understanding the requirements, culture, systems, resource allocation, functional interaction, etc…


Reasons for Failure (2)Reasons for Failure (2)

7. Company has no long term commitment to account management.

8. Account Management remains a sales program (ST) an not an account managementprogramme (LT).

9. Product and Price strategy dominate over marketing and Value creation for the customer.

10. Account Management Programme remains undefined on Priorities and implementation.

11. Companies want results too fast12. Conflict in compensation versus Objectives

7. Company has no long term commitment to account management.

8. Account Management remains a sales program (ST) an not an account managementprogramme (LT).

9. Product and Price strategy dominate over marketing and Value creation for the customer.

10. Account Management Programme remains undefined on Priorities and implementation.

11. Companies want results too fast12. Conflict in compensation versus Objectives


CONTENTCONTENT






❏ Conclusions






❏ Conclusions


Definition of Account Management (1)


Important Customer (1982)

Important Customer (1982)

Large, Big Major Account (1976)

Large, Big Major Account (1976)

National Account (1980)

National Account (1980)

KEY CLIENT KEY CLIENT KEY CLIENT KEY CLIENT (1992)(1992)(1992)(1992)KEY CLIENT KEY CLIENT KEY CLIENT KEY CLIENT (1992)(1992)(1992)(1992)

International Account (1994)

International Account (1994)

Worldwide Account (1998)Worldwide Account (1998)

Multinational Account (1998)

Multinational Account (1998)

GLOBAL GLOBAL GLOBAL GLOBAL STRATEGIC STRATEGIC STRATEGIC STRATEGIC ACCOUNT ACCOUNT ACCOUNT ACCOUNT (1999)(1999)(1999)(1999)

GLOBAL GLOBAL GLOBAL GLOBAL STRATEGIC STRATEGIC STRATEGIC STRATEGIC ACCOUNT ACCOUNT ACCOUNT ACCOUNT (1999)(1999)(1999)(1999)

Strategic Strategic Strategic Strategic Account Account Account Account (1999(1999(1999(1999----2000)2000)2000)2000)

Strategic Strategic Strategic Strategic Account Account Account Account (1999(1999(1999(1999----2000)2000)2000)2000)

Are those different names for the same phenomena?Are those different names Are those different names for the same phenomenafor the same phenomena??

Global Key Account (1996)Global Key Account (1996)Global Key Account (1996)Global Key Account (1996)Global Key Account (1996)Global Key Account (1996)Global Key Account (1996)Global Key Account (1996)




There is no concensus on the definitions but 3 main characteristics are common on Account ManagementThere is no concensus on the definitions but 3 main

characteristics are common on Account Management

Relational Relational StrategicStrategicmarketingmarketing

CommercialCommercial




key accounts are customers representing a large potential or actual sales volume as well in money terms as

in percentage of the total revenues. Sometimes they are the most profitable

customers

key accounts are customers representing a large potential or actual sales volume as well in money terms as

in percentage of the total revenues. Sometimes they are the most profitable

customers

Commercial focusCommercial focus




key accounts expect special and specific treatment and services: inventory management, logistics,

special prices, reporting, customer applications and solutions. Key accounts will centralise the purchase

from different geographic area’s and will involve different departments and different skills

key accounts expect special and specific treatment and services: inventory management, logistics,

special prices, reporting, customer applications and solutions. Key accounts will centralise the purchase

from different geographic area’s and will involve different departments and different skills

Relational focusRelational focus




key accounts can be selected because of their status, market leader position,

as ref. to open new markets, for diversification, technological

leadership, because they are or will invest.

key accounts can be selected because of their status, market leader position,

as ref. to open new markets, for diversification, technological

leadership, because they are or will invest.

Strategic marketing Strategic marketing focusfocus




❏ We believe there are 3 different processes at work which are not identified as such in practice, creating a lot of confusion,mismanagement and failures.

❏ We believe there are 3 different processes at work which are not identified as such in practice, creating a lot of confusion,mismanagement and failures.

Long Term Strategic

Dynamic/InteractiveProactiveCompetitive

Advantage

Strategic Account

Management

Mid TermMarketing

Static/Supplier driven

OffensiveCoordination/Relational

Key Account Management

Short Term Sales

Static/ Supplier driven

DefensivePerformanceKey Account Selling

Time FocusBehaviourObjectiveNatureProcess


Current views onAccount Management


Confusion and Failure on account management is due among others

to the non recognition of 3 different processes implemented

in an increasing complex environment due to globalization.

Confusion and Failure on account management is due among others

to the non recognition of 3 different processes implemented

in an increasing complex environment due to globalization.




Scop

eSc

ope

Tim

e Fo

cus

Tim

e Fo

cus Strategic

ManagementStrategic Account

Management

Relationship Management

Key Account Management

Sales Management

Key Account Selling

GlobalGlobalInterInter

nationalnationalRegionalRegionalNationalNational

LocalLocalFocusFocusProcessProcess

ComplexityComplexity


CONTENTCONTENT






❏ Conclusions






❏ Conclusions


Origins of Account ManagementOrigins of Account Management

❏ Key account management emerged at the end of 1950 in the US because of environmental changes which are still valid today:

! Increased concentration of buying companies! Increased geographic dispersion of buyers of same company! Increased pressure on costs and communication! Increased desire to develop partnerships! Increased complexity of buyers operation

❏ Key account management emerged at the end of 1950 in the US because of environmental changes which are still valid today:

! Increased concentration of buying companies! Increased geographic dispersion of buyers of same company! Increased pressure on costs and communication! Increased desire to develop partnerships! Increased complexity of buyers operation

Assign one person: Key account manager to handle interface with customer from a sales

point of view.

Assign one person: Key account manager to handle interface with customer from a sales

point of view.


History of Account ManagementHistory of Account Management

❏ 1950: Originally conceived to manage Big Sales to Big Accounts. (Dow Chemicals – Sears).

❏ 1960: A place to put non-promotable Senior Sales people.

❏ 1970: Not used anymore, no value over standard procurement procedures.

❏ 1980: More important as more revenues controlled by fewer accounts.

❏ 1990: Become very important as pure product strategy difficult to maintain. Effects of TQM, Standardization, Downsizing, Globalization, Strategic Alliances, etc…

❏ 1950: Originally conceived to manage Big Sales to Big Accounts. (Dow Chemicals – Sears).

❏ 1960: A place to put non-promotable Senior Sales people.

❏ 1970: Not used anymore, no value over standard procurement procedures.

❏ 1980: More important as more revenues controlled by fewer accounts.

❏ 1990: Become very important as pure product strategy difficult to maintain. Effects of TQM, Standardization, Downsizing, Globalization, Strategic Alliances, etc…


Why will it become more important ?(1)Why will it become

more important ?(1)

❏ Changing perception of Purchasing

!Now seen as a business process and not longer as o narrow specialized function

!Purchasing must as a business function analysethe fully integrated activities of Engineering, Production, Operations, Finance, Marketing and sales, Quality cost control within the overall business and management strategy

❏ Changing perception of Purchasing

!Now seen as a business process and not longer as o narrow specialized function

!Purchasing must as a business function analysethe fully integrated activities of Engineering, Production, Operations, Finance, Marketing and sales, Quality cost control within the overall business and management strategy


Why will it become more important ?(2)Why will it become

more important ?(2)

❏ Reasons for changes in Purchasing

!More outsourcing!Change in Technology !Global competition!Shorter product life cycles!Speed: JIT, TQM, Mass Customization!Vendor reduction programs to reduce purchasing

costs

❏ Reasons for changes in Purchasing

!More outsourcing!Change in Technology !Global competition!Shorter product life cycles!Speed: JIT, TQM, Mass Customization!Vendor reduction programs to reduce purchasing

costs


Why will It becomemore important ? (3)

Why will It becomemore important ? (3)

❏ Importance of international account management will continue to increase because of 5 trends:

❏ Importance of international account management will continue to increase because of 5 trends:

Industry StructureIndustry StructureMaturity of Industrial MarketsMaturity of Industrial Markets

Importance of account

management

Importance of account

management

Technology ICT/ (E-com & e-business)Technology ICT/ (E-com & e-business)

GlobalisationGlobalisation

Increase in Buying PowerIncrease in Buying Power


Why will It becomemore important?

Why will It becomemore important?

More competitionMore complexityMore concentration thru M&AMore central purchasingMore Vendor reductionMore outsourcing Elimination low value activitiesHigher Speed

More competitionMore complexityMore concentration thru M&AMore central purchasingMore Vendor reductionMore outsourcing Elimination low value activitiesHigher Speed

Less but moreimportantsuppliers

Less but moreimportantsuppliers

Account managementis an efficient and effective process

to implement

Account managementAccount managementis an efficient and effective process is an efficient and effective process

to implementto implement

5 Trends5 Trends5 TrendsLess but more

importantcustomers

Less but moreimportantcustomers


Framework for International Account Management

Framework for International Account Management

NEED FORINTERNATIONAL

ACCOUNTMANAGEMENT

NEED FORNEED FORINTERNATIONALINTERNATIONAL

ACCOUNTACCOUNTMANAGEMENTMANAGEMENT

OrganizationStructure

Management Processes

People

Culture

OrganizationOrganizationStructureStructure

Management Management ProcessesProcesses

PeoplePeople

CultureCulture

InternationalServices

International Value Chain

International Marketing

Competitive Moves

InternationalInternationalServicesServices

International International Value ChainValue Chain

International International MarketingMarketing

Competitive MovesCompetitive Moves

ConsistentWorldwide Service

One Point Contact

Partnership

Outsourcing

International AccountManagementStructure

Compensation/Incentive System

Unifom PurchasePricing

ConsistentConsistentWorldwide Worldwide ServiceService

One Point ContactOne Point Contact

PartnershipPartnership

OutsourcingOutsourcing

International International AccountAccountManagementManagementStructureStructure

Compensation/Compensation/IncentiveIncentive SystemSystem

Unifom PurchaseUnifom PurchasePricingPricing

Global/Regional Drivers

Global Channels

Transferable Marketing

Lead Countries

Global Economies ofScale

High Product Development costs

Fast Changing Technology

Global Competitors

Global/Regional Drivers

Global Channels

Transferable Marketing

Lead Countries

Global Economies ofScale

High Product Development costs

Fast Changing Technology

Global Competitors

ImplementationImplementationOrganizationOrganizationResponceResponceIndustry Industry DriversDrivers

InternationalInternationalStrategyStrategy


CONTENTCONTENT






❏ Conclusions






❏ Conclusions


Issues in International Account Management


" Types of Account Management

" Selection of International accounts

" Process & Resource allocation

" Competence

" Other issues

" Advanced Research




" Competence

" Other issues

" Advanced Research







" Competence

" Other Issues

" Advanced Research




" Competence

" Other Issues

" Advanced Research


Distribution

Distribution

Types of International AccountsTypes of International Accounts

SupplierSupplierSupplier AccountManagerAccountAccountManagerManager ClientClientClient

TYPE 1: Very SimpleTYPE 1: Very Simple


Distribution

Distribution


SupplierSupplierSupplier AccountManagerAccountAccountManagerManager ClientClientClient

TYPE 2: SimpleTYPE 2: Simple

ClientClientClient

ClientClientClient


Distribution

Distribution


SupplierSupplierSupplier ClientClientClient

TYPE 3: DifficultTYPE 3: Difficult

ClientDivision BLocation A

ClientClientDivision BDivision BLocation ALocation A

ClientDivision ALocation B

ClientClientDivision ADivision ALocation BLocation B

ClientDivision ALocation A

ClientClientDivision ADivision ALocation ALocation A

AccountManagerAccountAccountManagerManager


Distribution

Distribution


SupplierSupplierSupplier AccountManagerAccountAccountManagerManager

ClientCentralClientClient

CentralCentral

TYPE 4: More DifficultTYPE 4: More DifficultSupplier Divisionproductline A

Supplier Supplier DivisionDivisionproductproductline Aline A

Supplier Divisionproductline B

Supplier Supplier DivisionDivisionproductproductline Bline B

Supplier Divisionproductline C

Supplier Supplier DivisionDivisionproductproductline Cline C


Distribution

Distribution




CentralCentral

TYPE 5: ComplexTYPE 5: Complex

Supplier DivisionproductLine A

Supplier Supplier DivisionDivisionproductproductLine ALine A

Supplier DivisionproductLine B

Supplier Supplier DivisionDivisionproductproductLine BLine B

Supplier DivisionproductLine C

Supplier Supplier DivisionDivisionproductproductLine CLine C











CentralCentral

TYPE 5: Real World ModelTYPE 5: Real World Model

Supplier DivisionproductLine A

Supplier Supplier DivisionDivisionproductproductLine ALine A

Supplier DivisionproductLine B

Supplier Supplier DivisionDivisionproductproductLine BLine B

Supplier DivisionproductLine C

Supplier Supplier DivisionDivisionproductproductLine CLine C

Distribution

Distribution








Cross Europe Account Management can be even more complex

Cross Europe Account Management can be even more complex


Can become very complex when moving to Global Account Management

Can become very complex when moving to Global Account Management


Types of International Account management

Types of International Account management

CONTINGENCY APPROACH

! There is no such thing as a standard approach toward an international account management organization:

!The account structure will depend on the complexity of both the supplier and the client organization.

!The added value will be creased thru focus on the integration of operations of processes of the supplier and the client.

CONTINGENCY APPROACH

! There is no such thing as a standard approach toward an international account management organization:

!The account structure will depend on the complexity of both the supplier and the client organization.

!The added value will be creased thru focus on the integration of operations of processes of the supplier and the client.







" Competence

" Other Issues

" Advanced Research




" Competence

" Other Issues

" Advanced Research


Account RelationshipDevelopment Model

Account RelationshipDevelopment Model

ComplexComplex

Level ofInvolvementwith thecustomer

Level ofInvolvementwith thecustomer

SimpleSimple

Nature of the customer RelationshipNature of the customer Relationship

Synergetic AMSynergetic AMSynergetic AM

Early AMEarly AMEarly AM

Systems/SolutionsSystems/SolutionsTransactionTransaction

Mid-AMMidMid--AMAM

Partnership AMPartnership AMPartnership AM

Account Relationship Development Model of Millman

& Wilson (1994)

Account Relationship Development Model of Millman

& Wilson (1994)


Selection of International Accounts (1)Selection of International Accounts (1)

PartnershipJoint RelationPartnershipPartnership

Joint RelationJoint RelationComplexComplex

CustomerRelationshipComplexity

CustomerRelationshipComplexity

SimpleSimple

• Not all customers have same value• Volume is not the selection criteria• The more complex the product and the morecomplex the customer, the more chance thereis to build a partnership and create value

• Not all customers have same value• Volume is not the selection criteria• The more complex the product and the morecomplex the customer, the more chance thereis to build a partnership and create value

OpportunisticPrice Driven

OpportunisticOpportunisticPrice DrivenPrice Driven

Systems/SolutionsSystems/SolutionsTransactionTransactionProduct/Service ComplexityProduct/Service Complexity


Positioning Model of Gosselin & Heene (2000)Positioning Model of Gosselin & Heene (2000)Positioning Model of Gosselin & Heene (2000)

Captive Customers

Captive Customers

Transactional Customers

Transactional Customers

Strategic AccountsStrategic AccountsKey AccountsKey Accounts

Relationship willingness(Customer)

Relationship willingness(Customer)

Competence Leverage Willingness

(Supplier)

Competence Leverage Willingness

(Supplier)

H

HL

L

Not stable: Invest in specific

solutionsor managefor profit

Not stable: Invest in specific

solutionsor managefor profit

Invest in relationship

or reduceinvestments

Invest in relationship

or reduceinvestments



Selection of International Accounts (3) Selection of International Accounts (3)

7 S Model of Gosselin7 S Model of Gosselin7 S Model of Gosselin

Do the supplier and customer have and do they agree on a common strategy for the long term?Strategic FitStrategic Fit

If volume is low value with the customer, your value could be very low as well?Significant Significant

Margin or Potential MarginSoundSound

Do we want to be seen as a partner with this customer? Do we putenough resources to get him?SustainableSustainable

Do you want this type of customer? Is it a reference for future business?SympathySympathy

Cultural compatibilitySynergySynergy

Size of the customer marketScale Scale



Outsource these customersNNN

Marginal interesting do not investNYN

Increase volume if possibleIncrease volume if possibleYNYY

Keep and invest in those Keep and invest in those customerscustomers

YYYY

Important but not strategicYYN

Keep but Do not further investYNN

Increase volume and profitabilityIncrease volume and profitabilityNNYY

Keep but Increase profitabilityKeep but Increase profitabilityNYYY

Generic strategyGeneric strategyProfitableProfitableSignificantSignificantStrategicStrategic

Model of WhitneyModel of Whitney

Source: J. Withney, 1996, HBR



Model of McDonaldModel of McDonaldModel of McDonald

Manage for cash/withdrawMaintain

SelectivelyInvest

Invest/Grow

Competitive strengthCompetitive strength

Customer AttractivenessCustomer Attractiveness

H

H

L

L

Model is Model is based on based on

the classic the classic McKinsey McKinsey

modelmodel

Key accountsKey accounts







" Competence

" Other Issues

" Advanced Research




" Competence

" Other Issues

" Advanced Research


The Principles ofAccount Management Process

The Principles ofAccount Management Process

Source: Senn & Zeier 2000

Winning andkeeping

Strategic Customers

Building Long-term RelationsBuilding Long-term Relations

Developing Consistent Products/ServicesDeveloping Consistent Products/Services

Providing a Network OrganizationProviding a Network Organization


Where do successful Companies perform better ?

Where do successful Companies perform better ?

Study conducted by the University of St.Gallen: Senn 1998 & 1999, Senn & Arnold 1999:• N = 200, CS = Customer Satisfaction. High-low pairs significantly different at .01 level• Avg. CS of High Performing Group = 79%, Avg. CS of Low Performing Group = 63%• Results based on supplier performance resp. customer satisfaction ratings by their key accounts

65 % 40 %

68 % 42 %

69 % 46 %


Developing Consistent Products & ServicesDeveloping Consistent Products & Services


High Performers

(Avg. Performance)

High Performers

(Avg. Performance)

Low Performers

(Avg. Performance)

Low Performers

(Avg. Performance)Account Management ProcessesAccount Management Processes


Building the Framework (I)Combining Processes with Implementation

Building the Framework (I)Combining Processes with Implementation

Defining Goalsand Objectivestogether withStrategic Accounts

Step I Step II

Aligning BusinessProcesses betweenSupplier & Customer Organization

Step III

Leveraging Know-how and accelerating Learning Processes


Developing ConsistentProducts & ServicesDeveloping ConsistentProducts & Services


1

2

3

4

5

6

7

8

9

Source: Senn 1994 – 1999, Senn & Zeier 2000


Defining Goalsand Objectivestogether withAccounts

Building the Framework (II) Nine Areas to allocate Account Resources

Building the Framework (II) Nine Areas to allocate Account Resources

Step I Step II Step III

Aligning BusinessProcesses betweenSupplier & Customer Organization

Leveraging Know-how and accelerating Learning Processes


Developing ConsistentProducts & ServicesDeveloping ConsistentProducts & Services


1

2

3

4

5

6

7

8

9

Source: Senn & Zeier 2000

CustomersCustomers

SolutionsSolutions

PeoplePeople

RelationshipsRelationships

ProcessesProcesses

StructuresStructures

KnowledgeKnowledge

SystemsSystems

InformationInformation


Key success drivers Key success drivers

# Successful International Account Management goes beyond „traditional“ customer relationship and sales management.

# It is essential to assess the relevant business drivers and allocate account resources accordingly.

# Successful International Account Management goes beyond „traditional“ customer relationship and sales management.

# It is essential to assess the relevant business drivers and allocate account resources accordingly.

CustomersCustomers

SolutionsSolutions

PeoplePeople

RelationshipsRelationships

ProcessesProcesses

StructuresStructures

KnowledgeKnowledge

SystemsSystems

InformationInformation

Benchmarks from an International Research Project; Measures based on Industrial Supplier Performancerated by Key Accounts, n = 200; Senn & Arnold (1999), Thexis No. 4, University of St.Gallen.

Key Success DriversKey Success Drivers

Classic Focus Classic Focus







" Competence

" Other Issues

" Advanced Research




" Competence

" Other Issues

" Advanced Research


Role of the International Account Manager

Role of the International Account Manager

RoleRoleRole

AMAMSupplierSupplier CustomerCustomer

• Sales person• Product seller• Interface• Relationship?• Team player?• Administration • Co-ordinator

• Sales person• Product seller• Interface• Relationship?• Team player?• Administration • Co-ordinator

IssuesIssuesIssues

• Culture• Management

Support• Communication• Systems/Process• Turf wars• Authority• workload/focus• Credibility

• Culture• Management

Support• Communication• Systems/Process• Turf wars• Authority• workload/focus• Credibility

Traditional International Key Account SellingTraditionalTraditional International Key Account SellingInternational Key Account Selling


99Industry & Market KnowledgeIndustry & Market KnowledgeIndustry & Market Knowledge

22Global Team leadership & ManagementGlobal Team leadership & ManagementGlobal Team leadership & Management

1010Customer KnowledgeCustomer KnowledgeCustomer Knowledge

77Cultural EmpathyCultural EmpathyCultural Empathy

55Strategic Vision & PlanningStrategic Vision & PlanningStrategic Vision & Planning

33Business & Financial KnowledgeBusiness & Financial KnowledgeBusiness & Financial Knowledge

88Selling SkillsSelling SkillsSelling Skills

66Problem Solving CapabilitiesProblem Solving CapabilitiesProblem Solving Capabilities

44Relationship management skillsRelationship management skillsRelationship management skills

11Communication skillsCommunication skillsCommunication skills

International Account ManagerCompetences

International Account ManagerCompetences

Source: A. Millman & K. Wilson, 2000Source: A. Millman & K. Wilson, 2000

Importance RankingImportance Ranking1 = Most Important10 = Less Important1 = Most Important10 = Less Important

SellingSelling


International Account Manager:Competence Profile

International Account Manager:Competence Profile

Analyst

PoliticianCoordinatorStrategist

POLITICALENTREPRENEUR:

• Influence power• Take opportunities

POLITICALENTREPRENEUR:

• Influence power• Take opportunities

The International account manager must have the capability to solve problems for the customer and realize entrepreneurial opportunities thru the coordination and application of personal, team and organizational competences, withouthaving the full control over all resources.

The International account manager must have the capability to solve problems for the customer and realize entrepreneurial opportunities thru the coordination and application of personal, team and organizational competences, withouthaving the full control over all resources.


Impact of the context onCompetences

Impact of the context onCompetences

pEEntrepreneur

peSales

PEPotential

CEO ?

PeRelational Manager

Degree of organisational Interdependence and Integration

Degree of organisational Interdependence and Integration

Levels of Organisational complexity

Levels of Organisational complexity

H

H

L

L P: Political E: EntrepreneurialP: Political E: Entrepreneurial

International AccountManagement

International AccountInternational AccountManagementManagement

Key AccountKey AccountManagementManagement

Key Account SellingKey Account Selling

Source: SAMA, K. Wilson, 2000







" Competence

" Other Issues

" Advanced Research




" Competence

" Other Issues

" Advanced Research


Other IssuesOther Issues

❏ Organization structure: Who’s the Boss?❏ Cultural elements❏ New opportunities❏ Customer is no longer a Key account❏ Key Account Plan❏ Training❏ Internal Communication❏ Compensation plans❏ Role: Sales, BD or Executive Management?❏ Accountability: P&L or not?

❏ Organization structure: Who’s the Boss?❏ Cultural elements❏ New opportunities❏ Customer is no longer a Key account❏ Key Account Plan❏ Training❏ Internal Communication❏ Compensation plans❏ Role: Sales, BD or Executive Management?❏ Accountability: P&L or not?







" Competence

" Culture

" Advanced Research




" Competence

" Culture

" Advanced Research


Market Performance inStrategic Account Management

Market Performance inStrategic Account Management

Preliminary Research on Strategic Account Management at Ghent University, Department of Management and Organization (FEB) suggests with a high probability that:

Preliminary Research on Strategic Account Management at Ghent University, Department of Management and Organization (FEB) suggests with a high probability that:

Source: D.P. Gosselin, 2000

(*) Growth in % Customer Market Share and % of Company Portfolio sold to the Account

1. The market performance (*) of suppliers with a strategic customers is related to the PLC of the customer. This implies a process of dynamic allocation of resources: different relational behaviours at different times and the willingness to invest in specific and time related customers solutions using all available company competences.

2. The market performance of a supplier is higher with strategic selected customers if the supplier adjust his offer and performance according to the PLC of the customer’s Decision Units.

3. Market performance with strategic customers is higher if an explicit and recognized fit exists between the strategies of both the supplier and the customer.


International Account Performance modelInternational Account Performance model

1. Scope of Account2. Communication3. Support Systems

1.1. Scope of Scope of AccountAccount2.2. CommunicationCommunication3.3. Support Support SystemsSystems

Experience of account manager

Experience Experience of of accountaccount managermanager

AccountPerformance

Efficiency and Sales GrowthPartnership with Customers

AccountAccountPerformancePerformance

Efficiency andEfficiency and Sales Sales GrowthGrowthPartnership with CustomersPartnership with Customers

Centralization of vendoractivities versus customer

Customer dependence on vendor

CentralizationCentralization of of vendorvendoractivitiesactivities versus versus customercustomer

Customer dependence Customer dependence on on vendorvendor

Mechanisms for enhancing information processing capacity

Mechanisms for enhancing information processing capacity

Factors affecting relative bargaining power of vendor

Factors affecting relative bargaining power of vendor

Model of Birkinshaw, Toulan and Arnold, 2001Model of Birkinshaw, Toulan and Arnold, 2001

Key element of Performance is

organisation innovation toincrease information

processing

Key Key element element of of Performance Performance isis

organisation innovation toorganisation innovation toincreaseincrease informationinformation

processing processing


CONTENTCONTENT






❏ Conclusions






❏ Conclusions


Key Success Factors#1


Visible an Tangible Top Management Support.

It must be part of the strategy to build a customer driven organisation

Visible an Tangible Top Management Support.

It must be part of the strategy to build a customer driven organisation




All elements of the organization must be

involved and educated in the International Account

management processes and must known the objectives.

All elements of the organization must be

involved and educated in the International Account

management processes and must known the objectives.




The company must track progress on each account thru measurable milestone

activities

The company must track progress on each account thru measurable milestone

activities




In global or international account management Focus

on a limited number of accounts is essential to be

able to deliver what ispromissed.

Conflicts of resourceallocation.

Trust thru performance.

In global or international account management Focus

on a limited number of accounts is essential to be

able to deliver what ispromissed.

Conflicts of resourceallocation.

Trust thru performance.




The international account manager must have the authority to commit the

company.

The international account manager must have the authority to commit the

company.




Executive Management must be available for Relationship building.

Executive Management must be available for Relationship building.




International Account Management is another

business: Need Separate communications channels

towards customer and internal.

International Account Management is another

business: Need Separate communications channels

towards customer and internal.




First objective is to penetrate the account as High and as

Deep Possible. Cover all DMU:

Decision MakersInfluencersApprovers.

First objective is to penetrate the account as High and as

Deep Possible. Cover all DMU:

Decision MakersInfluencersApprovers.




The compensation of the Account Management Program

must not compete with the field sales force compensation

plan or with any other group that must support them.

The compensation of the Account Management Program

must not compete with the field sales force compensation

plan or with any other group that must support them.




International Account Managers must have a broad cross cultural experience and

must act more as business executives than as sales

executives.

International Account Managers must have a broad cross cultural experience and

must act more as business executives than as sales

executives.


CONTENTCONTENT






❏ Conclusions






❏ Conclusions


Conclusions (1)Conclusions (1)

❏ 5-7 times more easy and cost effective to grow the existing customer base.

❏ Value of a “Strategic Relationship” is worth 15% price increase.

❏ Select customers on “Relationship” potential, strategic fit and your willigness to invest in specific competence leverage

❏ The major issues in International Account Management are related to Cultural skills.

❏ 5-7 times more easy and cost effective to grow the existing customer base.

❏ Value of a “Strategic Relationship” is worth 15% price increase.

❏ Select customers on “Relationship” potential, strategic fit and your willigness to invest in specific competence leverage

❏ The major issues in International Account Management are related to Cultural skills.


Conclusions (2)Conclusions (2)

❏ Building a customer focused organisation for competitive advantage in business markets implies to manage a customer base thru strategic account management

❏ The International account manager should coordinate the dynamic resource allocation and solution adjustment related to the PLC of the customer: This is a top management function.

❏ Top management should understand their role, the change impact, investments and process implications needed to introduce Strategic account management: It takes time, money, vision and leadership to succeed.

❏ Building a customer focused organisation for competitive advantage in business markets implies to manage a customer base thru strategic account management

❏ The International account manager should coordinate the dynamic resource allocation and solution adjustment related to the PLC of the customer: This is a top management function.

❏ Top management should understand their role, the change impact, investments and process implications needed to introduce Strategic account management: It takes time, money, vision and leadership to succeed.


Conclusion (3)Conclusion (3)

International Account Management is a contingency

approach:No one best way to solve the

problem.

International Account Management is a contingency

approach:No one best way to solve the

problem.


References (1)References (1)

❏ SAMA: Strategic Account Management Association : http://www.nams.org

❏ Research on Strategic Account management Ghent University: http://studwww.rug.ac.be/~dgosseli

❏ Research on Sales & Account Management Erasmus University: http://www.erasmusforum.nl/index.html

❏ Sales Research Trust of Dr. Kevin Wilson: http://www.sales-research-trust.org

❏ Derrick-Philippe GOSSELIN: [email protected]


References (2)References (2)

❏ Lewis, J.D. (2000) « Trusted Partners, How Companies build Mutual Trust and Win Together », Free Press: New York

❏ Verbeke, W and Nagy, J. (2000) « Adaptief en Strategisch Accountmanagement », Samsom: Alphen a/d Rijn, Netherlands.

❏ McDonald, M. and Rogers, B. (1998) « Key Account Management », Butterworth Heinemann: Oxford, UK.

❏ Day, G.S. (1999) « The Market Driven Organization », Free Press: New York

❏ Trompenaars, F. and Hampden-Turner, C. (1997) « Riding the waves of culture », 2 edition, Nicholas Brealey Publishing: London

❏ Lewis, J.D. (2000) « Trusted Partners, How Companies build Mutual Trust and Win Together », Free Press: New York

❏ Verbeke, W and Nagy, J. (2000) « Adaptief en Strategisch Accountmanagement », Samsom: Alphen a/d Rijn, Netherlands.

❏ McDonald, M. and Rogers, B. (1998) « Key Account Management », Butterworth Heinemann: Oxford, UK.

❏ Day, G.S. (1999) « The Market Driven Organization », Free Press: New York

❏ Trompenaars, F. and Hampden-Turner, C. (1997) « Riding the waves of culture », 2 edition, Nicholas Brealey Publishing: London

INTERNATIONAL ACCOUNT MANAGEMENT

Documents

Transcript of INTERNATIONAL ACCOUNT MANAGEMENT