Struggling to effectively manage large accounts as an account manager is difficult without organization-wide support. Smaller accounts don’t have the same needs that larger key accounts have, so you may not have all the tools and insights you need, or the support to build effective account plans to ensure you and your largest accounts are achieving your mutual goals. You recognize that you need a structured process and tools to become a strategic partner and trusted advisor for your top accounts.
While searching for a solution you discovered the structured Key Account Management (KAM) process. You can tell it’s the best way to help you, help your customers while increasing customer retention and driving more revenue to your company’s bottom line. But the challenge is convincing your CEO that implementing a Key Account Management program is worthwhile.
In this post, we are going to provide you with some insights on how to convince your CEO that Key Account Management is worthy of his time and the resources needed.
Know your CEO
Before you can sell your CEO on anything, you need to understand a few things about them. Figure out what type of CEO you have, their priorities, their view of account management, how to get their attention, and how to get an easy “yes”.
CEOs range from analytical to creative and from very internal focused to externally focused. Their priorities are often influenced by their background which is how they made it to the C-suite. So, if a CEO is operational in nature, they are focused on operations. If their background is marketing, they are focused on the brand. And, if their background is sales, they’re frequently out in front of the customer.
Other influences of the CEO’s priorities include things like:
- The type and structure of company--private equity backed, venture back, or privately owned
- The status of your company in terms of growth, competitive stance, and challenges or issues
Account Management = Risk Management
Regardless of these influences, account management is seen as a risk and distraction for most CEOs. They prefer to focus on growth in terms of sales and opportunity. They often feel that the only time they hear about account management is when something goes wrong with an account and the customer is unhappy. So, they view account management as risk management and when account management does their job, the CEO can focus on growth.
Make it easy for the CEO to say “yes”
CEOs are pitched multiple times each day, so when you have your chance to present your proposal to implement key account management, you need a compelling argument. Plus, CEOs experience decision fatigue because they are constantly making decisions. Once they decide, they are fully onboard, but they don’t take decisions lightly. And, as CEO Mike Bruce (pictured above) said at KAMCon, “Even if it’s something that I want, I’m going to say “no” because I don’t want to process it and I don’t want to go to trial.”
Avoid going to trial
Mike continued to explain that you should create a cross-functional coalition and then sell the CFO on your proposal so that he doesn’t have to, as he called it, “go to trial.” Going to trial is where the CEO overcomes the objections of the risk-averse CFO to get financial approval for projects.
Leverage a decision that’s already been made
Tie your request to something that you’ve heard the CEO say that they want. This makes it easier for the CEO to say “yes” because it’s a decision that’s already been made. You’re leveraging the CEOs existing priorities and decisions instead of asking the CEO to decide on something new.
Identify the CEO's network
Keep in mind is that the CEO has an internal network of influencers they use to gather internal intel and insights. Identify people in the CEOs network so it’s easier to get on the CEOs calendar to pitch your proposal when the time comes.
Build a cross-functional coalition
Key account management is a team sport, so engage stakeholders in the affected departments to get them on board. By educating them on what’s involved and the benefits, you ultimately increase the odds of success for a structured KAM process in your organization.
Gathering this support is like getting a petition signed, endorsing your proposed course of action. This reduces the risk involved in initiating a program requiring resources from stakeholder departments. Going to the C-suite as a united front, makes it more difficult for them to say “no”.
What’s important to CEOs and CFOs
CEOs and CFOs form decisions differently. Understanding these differences will facilitate preparing a compelling argument for KAM in your organization. So, let’s look at what you need to focus on when presenting your case to the CFO and to the CEO.
Chief Financial Officers (CFOs) are risk averse. They like certainty, consistency, and reliability—the things that most customer-facing businesses don’t have. You need to communicate how KAM will minimize risk, increase compliance, and help the business get ahead. Discuss how KAM protects the company from the down tide and from losing accounts. These are the things CFOs care about.
To communicate this, tell CFOs about things like:
- The consistent, repeatable KAM process
- The VOC insights to proactively head off issues and ensure customer satisfaction
- The reduced churn rate/increased retention rate for more predictable revenue
- The competitive advantage of loyal customers.
By contrast, CEOs are growth-oriented, so you want to talk to them about things like driving more revenue to the bottom line through increased opportunities in existing accounts. Remind them that retaining the right customers can lead to profit increases of 25% or more. This happens because existing customers are easier to sell to and likely to spend more with your company. Plus, as loyal customers, they are excellent sources of new customer referrals who are also easier to sell based on the existing customer’s testimonial.
You should also remind the CEO that Key Account Management will give them access to deeper customer insights than a net promoter score ever could since this intel is based on Voice of Customer (VOC) interviews. The VOC process prevents the undesirable surprise of an unhappy, at-risk customer contacting them with a problem. CEOs especially dislike these types of surprises and prefer to focus on growth.
Pitch your CEO
Once you have built your coalition and sold the CFO on your proposal, get on the CEO's schedule to make your pitch. Leverage people in the CEO's network to make this happen and include cross-functional team members in this brief meeting.
Remember to tie your proposal to something that the CEO already wants so the “yes” is already there. And make sure that he knows that the CFO has already approved your proposal. This will tell him that he doesn’t have to take it to the CFO since you’ve already done the heavy lifting.