10 Best Practices for Strategic Account Management Programs

For many B2B organizations, a comparatively small number of accounts typically generate a disproportionately large share of the revenue. This phenomenon is sometimes referred to as the 80-20 rule, or Pareto Principle, which holds that 80% of outcomes (outputs) come from 20% of the causes (inputs).

“A goal of the 80-20 rule is to identify inputs that are potentially the most productive and make them the priority,” according to Investopedia. So it logically follows that “once managers identify factors that are critical to their company’s success, they should give those factors the most focus.”

This same principle is what motivates many companies to create specific programs and roles to handle strategic account management, which is also called key account management. The idea is that engaging in highly focused exploration of where to find such 80-20 sweet spots — both when examining existing accounts and prospecting for new ones — is well worth the effort.

So, how can companies identify which accounts are strategic and should be given extra attention? The key is in developing and utilizing strategic account management (SAM). Let’s look at why — and how — you can realize the benefits of this important model.

What Is Strategic Account Management (SAM)?
Benefits of Improved Strategic Account Management
Common Shortcomings in Strategic Account Management
10 Surprising Stats About SAM Plans
Strategic Account Management Training: A New Approach to Best Practices
Key Skills for Strategic Account Managers
Strategic Account Management Planning Tools
Driving Value with Strategic Account Management
Helpful Insights from the Strategic Account Management Association (SAMA)

What Is Strategic Account Management (SAM)?

Sales and marketing firm HubSpot offers the following definition of strategic account management: “Strategic account management is a framework that focuses on building engaged, mutually beneficial relationships between a company and its key accounts or customers to drive sales growth. Typically managed at the organizational level, strategic account management encompasses teams across departments within a company.”

Training Industry also emphasizes the relationship aspect in its definition, describing strategic account management as: “A process at the organizational level that goes beyond sales to encompass building strategic, mutually beneficial relationships between the company and its key customers. SAM builds trust between the two organizations by focusing on value and enabling alignment across the company.”

The essential component here is the relationship. As industry consultant Whetstone puts it, “What makes an account strategic is the synergy between the vendor and the client, i.e. the outcome of the work they do together is strategically significant to both organizations.” It is the work of strategic account managers (SAMs) to proactively build and develop those relationships by connecting with client stakeholders, establishing plans to drive value and coordinating with their team.

Benefits of Improved Strategic Account Management

Strong customer relationships are clearly at the core of business stability and expansion. Effective strategic account management magnifies the power of many individual relationships across the surface of contact with any given customer account. Organizations that invest in SAM training will set up their strategic account managers with the skills and knowledge to:

• Shorten the sales cycle by quickly and more efficiently closing opportunities with existing customers and having greater access to decision makers.
• Increase the retention of existing customers by strengthening relationships, quickly responding to customer needs and effectively responding to competitive threats.
• Lower acquisition costs in securing new opportunities by leveraging existing relationships.
• Generate increased revenue through continued, consistent business with existing clients.
• More accurately assess customer relationships against clear criteria, allowing teams to act on the Pareto Principle by identifying — and then focusing — on the best accounts.

With these clear benefits, every organization should be implementing strategic account development. However, there are challenges that can make adoption difficult or frustrating for your team.

Common Shortcomings in Strategic Account Management

What you have to understand about SAM is that it is a step beyond the traditional sales process. If sales is about solving current problems or meeting existing needs, then successfully building the relationships so central to strategic account management is about making future plans. It is a forward-looking process that takes much more preparation and investment. This different approach can reveal several shortcomings about your SAM implementation:

• There may be an uncertainty about prioritizing between short-term and long-term goals.
• Your strategic account managers may not have the right tools for effective planning.
• The process itself may be incomplete or lack essential steps.
• Your team may lack the right training or knowledge on how to build client relationships.

As a result, even though many companies may have a SAM program, their account managers don’t always use it. In some cases the process may be seen as too complicated and forms-driven, in others the process may be producing inconsistent results. No matter the perceived shortcoming, the effect is the same: account managers don’t believe the plans work or are worth the effort to make them work.

This disconnect comes about largely due to a general misunderstanding of how the SAM model is supposed to work, or the way it’s implemented in the organization. Here are 10 surprising statistics we’ve found from research into strategic account management plans.

10 Surprising Stats About SAM Plans

1. 89% of companies believe their use of SAM plans is going to increase.
2. 77% use revenue (actual and potential) as a basis for selecting their strategic accounts. However, out of the top 10% of overall SAM performers, a vast majority (79%) use gross profit as the criterion for selecting strategic accounts.
3. 71% of companies believe they had seen less than 26% improvement in sales since launching their SAM programs.
4. 61% of companies say, “training in strategic account management,” can enable them to enjoy greater revenue, profit and customer satisfaction.
5. 60% of companies believe “strategic accounts” should be generating 25% or more in revenue; 30% believe they should be generating 50% or more.
6. 51% see their SAM programs as a competitive strength, but 27% identify their programs as a weakness.
7. 48% believe the SAM process in their company lacks effectiveness.
8. 42% attribute lack of effectiveness to “company structures, systems and/or processes” in executing strategic account management.
9. 36% attribute inadequate effectiveness to “lack of cooperation and collaboration among various groups at the company.”
10. Only 32% of companies say they know enough about how to build and communicate the messages of value they can bring to bear for strategic accounts.

Statistics sourced studies done by Mercuri International and RAIN Group.

These aren’t encouraging statistics for a process that’s intended to improve results. The problem is that, too often, your strategic account managers are left to flounder after being asked to figure out this process on their own. If your organization is serious about providing your SAMs and their teams with the tools they need to succeed, then it needs to adopt key account management best practices.

Strategic Account Management Training: A New Approach to Best Practices

At Global Partners Training, we are all about the alignment of information, people and actions. For us, SAM isn’t so much a strategy (ironically enough) but more of a process. Most SAM programs have a similar process where participants are asked to:

• Develop the customer’s profile and analyze and address their needs
• Define, position and sell a unique value to the customer
• Establish account objectives, strategies and course of action
• Continually capture opportunities ,and grow or strengthen the account

The problem is that often too much emphasis is placed on the completion of the SAM plan, which can lock improvements behind company silos. These silos are part of an imposed top-down approach that stratifies information, separates out teams and — worst of all — sets your people apart from your customers.

What Global Partners does is implement a strategic account alignment (SAA) to help make sure your stakeholders connect with your customers.

1. Align information. Rather than have customer information relegated to a repository, it is shared across teams to arrive at a common understanding of customer objectives. Within a workshop environment, as participants discover the customer strategy (like collectively solving a puzzle), they will align on the most important pieces of information.
2. Align people. Cross-functional collaboration aligns different departments behind a common vision of the customer. Collective sense making (solving the puzzle together) starts within the workshop, and then continues throughout regular operations: Team members are able to understand what everyone contributes to the overall account strategy and what is each person’s critical role.
3. Align actions. The transparent collaborative action planning exercise naturally aligns top and middle management with people in the field. With a better understanding of the organization’s larger strategies, every account member can constantly assess the relevance of their actions during certain touch points, especially if unexpected events disrupt or modify the situation.

The Global Partners Training SAA program constantly reassesses the alignment of info-people-actions through quick checkpoints throughout the training program. This continues until the entire organization internalizes the process and is able to perform it on its own, making it a habit that continues in perpetuity.

In one example, STMicroelectronics asked GPT to initiate a version of the SAA approach, called the “capture market share” (CMS) program, to better align their team members while identifying new ways to create value for customers. While every ST team member came into the CMS program with extensive customer knowledge, the program asked them to think outside their own area and align their knowledge across teams through ST’s global organization.

During the CMS workshop it quickly becomes apparent that, although all team members were executing what they believed to be the right strategy, their actions were not aligned with each other or the larger organization, resulting in an uneven and sub-optimized approach to working with ST’s customer accounts on a global scale.

Johan, the strategic account manager, described that moment of clarity: “I realized at the start of the program that each person who interacted with a part of the customer organization had been reacting to the local demands from the customer with no common understanding on what was needed across the customer’s global business. The power of the CMS program was to bring together the unique perspective of each member of the team on how to create value for the customer and for ST. We could drive more value for the customer and more business for ST by pooling our collective knowledge and coordinating our approach.”

As a result of the workshops, ST was able to initiate several best practices that encouraged and supported continued alignment:

• The creation of a more open peer-to-peer relationship between senior executives
• Regular monthly reporting on strategic actions that were shared with customers
• A website for customers and ST stakeholders to share information and collaborate

The most critical components in achieving a strategic account alignment are to properly train and up-skill your strategic account managers, provide them with the right planning tools and effectively support your leadership team.

Key Skills for Strategic Account Managers

The essential component of the strategic account manager position is to get everyone communicating in helpful ways across the customer surface of contact. The members of your account management team will all have different skills and specialities. You’re likely to have a mix of technical experts and relationship leads — each with their own priorities and approaches. To get them to collaborate you’ll need a project manager that coaches them to communicate openly.

In an analysis of top keywords for required skills and qualifications for strategic account managers, ZipRecruiter found the most common and important to be related to “collaboration, technical, digital, relationship management, compliance, account management and CRM.” These priorities are reflected in an example job description from HubSpot, which includes the following requirements and skills:

• Can establish a relationship as the main point of contact for assigned accounts in order to understand their opportunities and challenges.
• Able to identify and explain how the company’s offerings can best support the customer’s opportunities and challenges.
• Has the capability to proactively monitor the satisfaction level of customer accounts and report progress to internal stakeholders.
• Will serve as the internal company contact for all relevant customer accounts, managing communication channels between key clients and internal departments.
• Can employ relationship-building skills to establish trust and build rapport with account stakeholders, able to innovate solutions for complex problems.
• Possesses data reporting and analytical skills to pull and analyze key metrics related to customer retention and satisfaction.

You can’t assume an ideal strategic account manager is going to just bring strong interpersonal and business/technical skills to your organization. They have to be familiar with the SAM model, receive the right account management training, be supported in learning how to engage customers, and then know how to iterate on that relationship. A key component of that training is having access to the right planning tools.

Strategic Account Management Planning Tools

There’s a wide array of options of account management tools, so selecting the right planning tools for your SAM can be one of the most important decisions you can make. In general, any planning tool should have the following key components to effectively support your sales and account management.

• Industry Analysis Tool — Capable of examining, analyzing and documenting industry-related issues such as market conditions, supply and demand, technological developments as well as political or social factors that may impact the customer.
• Customer Relationship Analysis Tool — Allows for documenting the history with the customer and lays out possible areas for future expansion.
• Customer Strategy Map — A detailed list of the customer’s goals, challenges and culture in order to develop a comprehensive strategy to achieve the customer’s objectives.
• Stakeholder Assessment Tool —Allows your team to categorize stakeholders by their role, power, influence and interest in order to determine how they best align with your goals and solutions.
• Competitive Assessment Tool — Positions your team to analyze your competitive position from the customer’s perspective, benchmark your offerings against your competitors’ and highlight ways to better showcase your unique value.
• Action Plan — A means to easily identify potential obstacles, detail future actions and determine which team members will be responsible for executing certain steps.

Of course, having the right tools doesn’t necessarily mean your team will be able to effectively use them. Being able to integrate these technical tools into a customer-focused process requires essential training and coaching.

Driving Value with Strategic Account Alignment

The essential outcoming for adopting the SAM model is to continually drive value for your customers. Your team needs to be proactive in developing the customer relationship and your strategic account managers need to have the proper tools for supporting that process. While it’s simple enough to promote strategic planning, increased collaboration, and customer-focused thinking, the reality is that meeting the challenges of this model requires a consistent and methodical approach.

That’s why Global Partners Training has innovated the strategic account alignment approach. Whether the demand for an effective SAM Plan has increased at your organization, or you’re looking for a way to make your existing process more effective, contact us to see how we can assist you with a SAA.

Helpful Insights from the Strategic Account Management Association

If you’d like to read more on the essential approaches for implementing the SAM process, we recommend a review of the key frameworks outlined by the Strategic Account Management Association, SAMA.

They offer helpful insight on the organization framework and long-term strategic customer relationship necessary for strategic account managers and their teams.

See more here.