Driving Growth through Strategic Account Management - Using the Tools of Business Strategy to Sell and Maintain Complex Accounts

James W. Wilson

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Implications for the Organization

The idea of targeting a segment of complex customers for delivery of strategic value broadens the context of “sales” from the sales organization to include executives responsible for strategy and business development.  Designing and implementing a truly strategic account management process requires changes in selling resources, processes, territories, and performance measures and expectations. Some specific implications include:

Access to Business Strategy Capability:  Sales organizations involved in complex sales require the skills of business strategists to be successful.  Many organizations are thin in experienced business strategy development talent and will have to make qualified strategists available either from internal or external sources.

Structuring the Strategic Account Sales Process for Success:  For many companies, the structure of sales territories, compensation plans, knowledge sharing, and sales process stage-gate definitions are not suited for selling strategic value in complex accounts.  For example, the significant up-front investment and longer sales-cycles for these kinds of accounts require that compensation be biased toward base pay rather than toward commissions based on short-term performance.

Integrating Executives into the Sales Process:  There’s really no way around it.  And since the time of executives is severely limited, the key to success is careful qualification and orchestration of executive-to-executive interactions so that the time is used in a productive way.  Again, this has implications for the sales process for complex accounts.

Clearly Defining and Articulating Business Strategy:  Sales reps and executives will need to have a clear understanding of their own company’s business strategy in order to envision realistic assistance to customers.  Some companies have good strategies that are not widely shared in the organization.  Others lack strategies that are universally  understood and supported by the management team running the business.

Joint Solution Development and Risk Sharing:  When vendors make commitments to support their customers’ strategic initiatives, the risk changes from the threat of a lost sale to the possibility that the customer’s strategic initiative will not achieve the intended business results.  In evaluating these risks the vendor must apply a new level of business analysis and judgment to the traditional sales funnel.

Involving a Broader Set of Resources in the Sales Process:  The stepped-up investment in strategic accounts is in part driven by the diverse set of resources required to understand the potential fit of vendor capabilities into the customer’s strategic vision.  Organizations must be willing to commit internal resources from functions like engineering, research, IT, and HR that are not traditionally involved in sales.  It sounds expensive and risky but it’s a fact of life in the world of complex products. 

Getting Started:  Requirements for Sales Representatives

To support a robust, strategic approach to complex accounts, organizations need to evolve in the ways described above.  But in the near term there are clear drivers of success that are largely within the control of the sales organization. Some of the requirements for success based on the experience of other companies in strategic account management are:

An Outside-In Perspective within the Sales Organization:  Understanding the world from a customer point of view can be difficult for individuals who are highly skilled at finding ways to position pre-existing solutions by screening customers for certain kinds of needs. In most cases, sales organizations need to adopt tools from business or market strategy development in order to develop the deep customer insights that lead to totally new kinds of solutions.

Sales Reps Who Understand Business Strategy:  Sales representatives need to understand the strategic competencies of their own organizations, not just the products and services.  In order for this to happen, there must be a deliberate process to gain consensus on what those competencies are and to develop communications around them to support development of account relationships based on sharing those competencies.

Sales Reps Conversant in Customer Business Issues:  Sales representatives need to be able to speak to the business issues of their customers, not just to product/service features and benefits and applications.  This will take some effort as well, since individuals skilled in business strategy and management tend to gravitate to management and executive positions where these skills are more highly valued.

Sales Reps Conversant in Diverse Functional Topics: Sales reps need to be able to communicate with the diverse array of managers and individuals who could logically be involved in designing and delivering solutions based on organizational competencies.  This means having credibility and comfort in conversing with professionals from the vendor as well as the customer organization in engineering, research and development, IT, HR, supply chain, customer service, etc.

Adopting approaches and methods from business strategy to sell and manage complex, strategic accounts isn’t a simple task and will undoubtedly create a few headaches along the way. But it does have the potential to connect businesses to customers and growth opportunities in exciting new ways.  If executives lose sleep over this prospect rather than fretting over the status quo, so be it.

Additional Resources - Articles

“Spend a Day in the Life of Your Customers”
Francis J. Gouillart; Frederick D. Sturdivant, Harvard Business Review, January 01, 1994

 “Strategic Sales Management: A Boardroom Issue”
Adrian J. Slywotzky; Benson P. Shapiro; Stephen X. Doyle, Harvard Business Review, November 29, 1994

“Value Innovation: The Strategic Logic of High Growth”, Renee A. Mauborgne; W. Chan Kim, Harvard Business Review, January 01, 1997

Books

Rethinking the Sales Force: Redefining Selling to Create and Capture Customer Value
by Neil Rackham, John R. Devincentis , 1999

Solution Selling: Creating Buyers in Difficult Selling Markets
by Michael T. Bosworth, 1994

The New Strategic Selling : The Unique Sales System Proven Successful by the World's Best Companies
by Stephen E. Heiman, Diane Sanchez, Tad Tuleja, Robert B. Miller, 1998