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A Beginner’s Guide to Key Account Management


A Beginner’s Guide to Key Account Management

In this article for Startup Today, Alistair Taylor of Brightbridge Consulting talks about how of key account management (KAM) can unlock long term business value with the customers you already do business with and explains why it’s not just another sales tactic.

What is Key Account Management?

Key account management (also known as strategic account management) is the process of proactively developing relationships with those strategic customers you do business with that represent the best opportunities for long term value and business development. Because it operates over the long term at a deeper and more strategic level than a sales based approach it requires a different approach to how you do business. This means cross-departmental and senior buy-in, the appointment of a key account manager, continual training and development of a KAM team and effective change management in order to deliver results.

Although KAM does involve winning new and often complex business from existing customers, it shouldn’t be confused for just another sales tactic. Sales tactics can tend to identify customers who can quickly generate more business This focus is transactional, focused more on revenues than profits and one-way. Key account management on the other hand is strategic in nature and takes a symbiotic and ‘customer first’ view to winning new business, by seeking to create a two-way street with the customer to generate short and long term value.

Key Account Selection Criteria

 Every business will have its own indicators of value, which may not simply be based on hard numbers. Whilst your largest customers may often be the prime candidates for your key accounts, this isn’t necessarily the rule. For example, some of your biggest customers, in terms of pure revenue, may not be your most profitable, requiring disproportionate amounts of your time and resources and showing very little loyalty in the process. Conversely some of your smaller customers may be growing fast and show huge potential for collaboration and developing a strategic long-term relationship as they do.

The crucial thing to remember here is that key accounts show the potential for deeper collaboration, transparency, joint innovation and are willing to commit resources to unlock greater value in how they do business with you.

Key account management therefore involves developing a selection criteria and applying this to your portfolio of customers. Some of the measures your key account selection criteria will take into account include:

  • Account growth level – this is vital because a small customer with high growth potential offers real opportunities for investment
  • Account behaviour – a loyal customer who operates in a ‘good’ way is an attractive prospect. Which of your customers is it best to do business with?
  • Prospects for innovation – if your customers are ready to change the way they operate or they want to benefit from innovation, you have the chance to help them with this, generate high upsides and make yourself indispensable.
  • Collaboration opportunities – key accounts must be prepared to invest time and energy into the relationship with your business too, so look for accounts that are ready and able to enter into a two-way relationship.
  • Shared values – a common business culture creates a valuable starting point and a shared, or at least compatible, set of values that help you to do good business together.

Creating a Value Proposition for Key Accounts

Once you have been able to identify your key accounts, you need to create a value proposition. This can take the form of a formal document which defines why your key customers should work with you rather than your competitors. Value propositions  can be narrow or wide in its scope – applying to your entire business or a specific product or service that will improve your customer’s position. Your value propositions need to be:

  • sufficiently motivational to prompt action by the customers
  • clear on how you are different from the competition
  • credible and supported by data
  • quantified, with ROI and risk figures
  • customer focused and demonstrative of your deep understanding of their needs.

Remember to develop these with different parts of the business to ensure buy-in and to ensure that oft-forgotten departments such as IT and finance are included for their input. They may have fresh insights or see that value can be offered in ways a sales or marketing team hasn’t seen.  Finish it with a brief executive summary which will summarise the contents succinctly and which can be used for impactful communications.

How can Key Account Management Drive Profit?

The secret of good key account management is to really understand exactly what your customers want – and then to efficiently deliver it.

There are many initiatives that can unlock the potential found in key account management strategies. They can include better supply chain management, collaboration and joint innovation, more streamlined systems and purchasing processes, or joint working on initiatives.

By getting senior level buy-in on your key account management programmes, the business can direct resources towards unlocking value, whilst cutting back on unnecessary resource spend on low-profit customers. By unlocking economies of scale with your customers, you are able to reduce costs, better position your own pricing negotiations and install more commercial discipline within your own purchasing processes. All this works towards building your own competitive advantage and eventually preferred supplier status amongst key accounts.


 Key account management is a vital business strategy that can help you to unlock competitive advantage by more intelligently directing your efforts towards pockets of maximum value. Take the time to build the relationships that count, both internally and externally and if you’re willing to invest in your key accounts then you’ll be reaping the benefits for the long term.


About the Author: Alistair Taylor is a key account management consultant and the founder and managing partner of UK based Brightbridge Consulting. He has over two decades of experience working as a senior manager and consultant for large corporations and organisations all over the world, implementing and running highly successful key account programmes. You can connect with Alistair on LinkedIn.

I am the founder of Startup Today. I am the main writer and have put in many hours of work into creating this blog. If you want to find out more about me then lets get in contact.

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