Needs a Different Mindset: Successful Companies who have implemented Key Account Management look at it as a Strategic way of doing business and not a sales activity. You need to have commitment to work with priority customers differently. For example Supply Chain management can be an integral part of Key Account Management
Commitment from Top Management: It cannot happen at the Sales Manager’s level. The buy-in has to be at the CEO, CMO, VP-Sales level. The sr. people should sponsor at least 1-2 such accounts and interact/visit them regularly.
Select the Right Person: Maturity is the most important attribute while selecting the Key Account Manager. It is not necessary that your top-performing salesman can become a good Key account Manager. He has to be more of a generalist with good understanding of finance, inventory, planning, influencing skills and the ability to see the big picture. A typical salesperson who is desperate to close order may be a misfit. One key competency is to understand the customer’s business beyond his immediate requirement.
Identify Key Accounts Carefully: Lynette Ryalls in a HBR article says the number of accounts should be within 5-25. Even a company like Xerox does not have more than 100 customers as Key Accounts.
Appoint and Train the Key Account Management: The communication and influencing skills of the Key Account Manager has to be exceptionally good. He should be able to talk technicality at lower levels as well the macroeconomic environment, the interest rate with CFO and CEO comfortably.
Put the right Metrics: He should not be judged on top-line results. In case of rate contracts with low margins when the cost of servicing a key account is high, the consequences can be disastrous. Performance should be judged more by the margins or net contribution. Another yardstick can be the lifetime value of the customer.
Rework on the Key Account Management cases every six months: All major accounts need not be key accounts. There are some unique parameters on which you should decide which customer remains in the Key account basket and those who need to be taken away.