Published on February 1, 2009
Sales Account Management 101 The “7 Habits” Account Manager
Definitions • Account – Any organization, or subset of an organization, that operates to some extent as a single circle of influence in its decision making processes – especially as these decisions relate to the organization’s interaction with your organization • This definition is fuzzy and fluid by necessity – Affected by natural forces of change and/or the account manager
Definitions • Account Management – A sales person’s concerted, conscious efforts to foster a high-level relationship between an organization and your company toward the specific goal of exposing and creating the sales opportunities, appropriate for the particular type of account (end user / OEM / VAR) that will result in sales momentum.
Definitions • Sales Momentum – Revenue generation that is disproportionate, in a nonlinear fashion, to the sales effort invested in an account
Definitions • Account Management vs. Account Development – Activities required to establish sales momentum (account development) are often different from those required to sustain and expand sales momentum (account management) • Many people often use the terms interchangeably
Definitions • Contact / Lead Management – Objective: Account Management • to be considered • close transactional sales Opportunity Management Contact/Lead Management
Definitions • Opportunity Management – Objective: • close larger sales or series of sales • More strategic: disconnected Account Management interactions compared to individual purchasing cycles • Non-technical influences on decisions motivated by business considerations, Opportunity Management strength of relationships, political pressures, and organizational structures. Contact/Lead Management
Basic Decision Process Plan Value Adding Partner Recognize Search Solution Provider Evaluate To make a Sale To Dominate an Account Supplier/Provider Repeat Business Select To be Considered Vendor Commit Implement Track
Definitions • Account Management – Objective: • Generate /sustain Account momentum within an Management account that will expose and create sales opportunities out of proportion to sales Opportunity effort Management – Often accomplished by teams – Affects culture of Contact/Lead Management customer accounts Account management is a focused and proactive sales process that invests time into understanding the “greater picture” of an account and leveraging that information to build influence and sales over time.
Territory Account Management • Example components of a balanced territory business plan. Timeframe Affect on Area Success Leading Risk if Factor Indicators Overdone Or Mindset Account Longer term Focused Planning & New Insight Dependent upon Penetration a few accounts Development Partnerships Proactive Opportunities or an Industry Increased Mindset Control Opportunity Shorter/ Broad Coverage Leads & Visits Lack of larger Management High sales and sense Medium term Diversification New Accounts Levels of of control Sales Activity
Habit One – Be Proactive • Activity is important… – But it is not the ultimate metric • It is important to do things right… – It is even more important to do the right things • Cannot merely react to customer requests • The most significant “competition” is often the fact that an application has never been considered – or has been written off as unapproachable
Habit Two – Begin with the End in Mind • Effective activity is focused activity • Evaluate all activity in light of goals • If you are not regularly making conscious choices not to do various tasks, you are probably not executing on a strategy • Have a goal for every visit, every phone call, every email • If you do not begin with the end in mind, you risk losing “impact effectiveness” – interactions with customers in which you have the right message at the right time
Habit Three – Put First Things First • There will always be more valuable things to do as a salesperson than there will be time in which to do them – If you don’t make the decisions, they will be made for you by the tyranny of the urgent
Habit Three – Put First Things First • Account managers should be very responsive to but not completely ruled by inbound customer requests – The largest opportunities are typically long-term, slowly developing, paradigm-shifting processes that can take months/years to bring to fruition • It will be rare for the most important action items in these opportunities to come in with “urgent” time frames • Anyone can handle action items that are both urgent and important – You must manage your accounts, not merely service them
Account Selection • Overarching goal: identify End-user, VAR, and OEM accounts that generate sales revenue completely out of proportion to sales effort. (sales momentum)
Factors to Consider in Account Selection • What business is the account in? • What is the financial health of the company? • What is the top-down organizational structure? • What are the purchasing sign-off procedures and the amounts per level? • How does upper management view the project's success? • Who are the influential key inside people in each organizational section? • Who are existing partners? Who are potential partners? • What is your competition's strategy for the account? • What are the current projects for your products, list the people involved, identify the timeline, and identify the budget? • What is their timeline? What is their budget? • Where does their funding come from?
VAR Accounts • Mechanism for sales momentum in a Value Added Reseller (VAR) account is the growth of the VAR’s own business – VAR must have a solid business plan
OEM Accounts • The goose that lays the golden eggs • Sales momentum attained by embedding your product within the customer’s products • If you are selling a higher-level sub-assembly, it is, of course, best to look for applications where cost is not the only factor in the decision • Long-term and slow to develop
Habit Four – Think Win / Win and Habit Five – Seek First to Understand, Then to Be Understood • Must understand and believe in the connection between account’s adoption of your solution(s) and the attainment of your customer’s business goals • “Understanding” must go far beyond the technical details to the social, political, organizational, and business issues • Use natural ‘events’ as opportunities to learn the rest of the organization. – Purchasing issues – great time to meet and visit the purchasing department – who and how do they work? – Design changes- meet the end user department, understand what other issues may be addressed in future. – Trial Run/Successful Projects – Great time to follow-up with directors, did it meet their objectives – Company Budget Planning – Offer to do “rough quotes” for engineer managers during fiscal cycles. • Best information is often indirect or even unspoken. LISTEN!
Habit Four – Think Win / Win and Habit Five – Seek First to Understand, Then to Be Understood • Once you understand, tailor your presentations can speak directly to the customer’s situation in a way that no low-cost competitor can match
Understanding what Makes the Company Churn “Why does a company need both Revenue and Profits?”
Cash is King! Where Can Your Product Help Drive the Process Faster or Better? Stock Offering, Bank Loan Cash Build-up Raw In Progress Finished Materials Capital Equipment Goods Operations: Cash R&D Sales Marketing Accounts Accounts Sales Revenue Receivable Payable
Balance Sheet Snap shot at any point in time showing the value of your investment: Assets – Liabilities = Owner Equity Generate Cash and Thrive Consume Cash and ???
Balance Sheet The three most important elements of the balance sheet which have the largest impact on CASH: Receivables Inventory Payables
Understand how the Financials Add-up • What is all involved in the end system and how can you help reduce these costs? – Personnel costs – Indirect costs like corporate overhead – Depreciation – Annual operating costs – Capital equipment costs 101 finance book: “Analysis For Financial Management”, Robert Higgins
Maximize Benefits in Financial Terms • Accuracy - Will the proposed system provide better accuracy. • Availability - How long will it take to develop and implement the system? • Compatibility - How compatible is your alternative with existing systems and procedures? Will one alternative require less training of personnel or less new equipment or software? • Efficiency - Will your alternative provide faster or more accurate processing. Will your alternative require fewer resources for the processing? • Maintainability - Will the maintenance costs for your alternative be less than the others? Are the maintenance resources easier to acquire for your alternative? An example of this could be availability and cost of programmers to maintain the software. • Modularity - Will the software for your alternative be more modular than the other alternatives? Greater modularity can reduce maintenance costs and will increase the portability of the software. • Reliability - Does your alternative provide greater hardware or software reliability? Greater reliability translates to higher productivity in using and/or operating the system and less time for operations and user support. • Access - Does your solution provide better connectivity so live or post results can aid future implementation.
Habit Four – Think Win / Win and Habit Five – Seek First to Understand, Then to Be Understood • Look for opportunities to present on the strengths of your company • Longevity, strong leadership, success as a publicly traded company, market resilience and global presence • Your customer cannot afford the possibility of being marooned on an obsolete platform • Don’t pull the company overview slides out of your presentations.
Habit Six – Synergize • Synergy – any situation in which the whole is greater than the sum of its parts • Does a product’s sales drive sales of another product, and vice-versa? • Teamwork within the organization – You are to be the “face of corporate” to your customers – You cannot be “Corporate” and must not try
Habit Seven – Sharpen the Saw • You are in a marathon, not a sprint • You need to stay technical or up to date – Regular, scheduled times for self-study – Make time to read trade journals, local business journals, customer / partner / competitor web sites • Study the methods of your colleagues, business partners, and competitors • Jealously guard your other life priorities
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