Issuu on Google+

SIEMENS Professor: Victor Noguer Castellvi

Strategic Key Account Management 20th March 2013 Joana Lemos Tuesday, March 19, 13

Lena Luehmann

Mariona Prates

Cristina Vieites

Guillem Meseguer


1. Customer inputs in meetings WHAT?

Advice / Hints / Criticism

creation of new opportunities

HOW?

Depending on ‌ Relationship supplier vs partner

Phase Lead: potential leads, briefing

supplier: tender-based relationship partner: strategic cooperation

Opportunity: potential idea, outsource Bid prep: announcement of project, define technical specifications Contract negotiation: selection

SKAM13

Tuesday, March 19, 13


2. KAM - the pig in the middle? EXTERNAL CONSUMERS

convince / compel to get the deal

INTERNAL ORGANIZATION

convince BU about customer’s value (esp. when re-negotiating)

‘Account Target Agreement’ (ATA) to align targets & to help secure Business Unit´s commitment SKAM13 Tuesday, March 19, 13


3. Re-negotiations OPTIONS & IMPACT refuse

overall negative affect on relationship prevent further business opportunities

accept

domino effect: other customers might ask for renegotiations need to explain ‘reason why’ to BU time consuming

SKAM13 Tuesday, March 19, 13


4. Program Evolution coordinate cross-business/-country activities

STEP ONE: 1990’S communication only through IT system report directly to managing board looked for deals in every geography & BU not anchored to BU’s KAM’s uninformed, without career path, perceived as competitors

STEP TWO

Centralized purchasing activities & request for higher secrecy

anchored to & report to BU’s downside: silo-minded KAMs are well connected with sales force & BU, have deep knowledge & a career path Tuesday, March 19, 13

SKAM13


4. Program Evolution STEP THREE: 2004 ‘SIEMENS ONE’ new approach: centered on cross-sector collaboration & customer centricity

Further development KAM framework based on best experiences to be adopted by each sector

STEP FOUR: 2010 ADD CORPORATE LEVEL 3 levels: regional, global, corporate top-down structure Sales board MDB KAM

Tuesday, March 19, 13

SKAM13


5. Key Account selection criteria DATA

INDUSTRY

SALES

(ex: customer turnover & installed equipment)

(ex: growing market/ customer in the market)

(sales potential & crossselling opportunities potential achievement time goal)

SKAM13 Tuesday, March 19, 13


5. Key Account selection criteria LEVEL (international or regional)

lONG-TERM

FIT

(stability of the business)

(strategy & culture)

STRUCTURE (centralized decision making)

SKAM13 Tuesday, March 19, 13


6.Maintaining & deselecting KA MDB RARELY HAPPENS

Reasons? “If so, it‘s because it‘s better for the customer to be served at a regional rather than international level or if business is too volatile or because we change our portfolio (as in 2011 when we sold our IT & comms business)...” SKAM13 Tuesday, March 19, 13


7. Siemens Internal organization 4 SECTORS

SEVERAL DIVISIONS

CEO’S (in charge of several business units with profit & loss responsibilities)

Top-down structure Mixed teams - ex: CAM’s & RAM’s SKAM13 Tuesday, March 19, 13


7. KAM profiles at Siemens REGIONAL

GLOBAL

CORPORATE

(national accounts)

(specific product portfolio)

(entire spectrum of Siemens portfolio across different sectors)

Involvement of the board “Involvement of board shows commitment to customer centricity, builds trust and provided us with their needs/ wants...”

SKAM13

Tuesday, March 19, 13


8. KAM

SF relations & conflicts

COORDINATION WIDER VIEW THREAT

architects of a network of relations

help BU to see the bigger picture instead of being too focused on their own business

be the translator of the customer voice

BROAD KNOWLEDGE

know everything about the business SKAM13

Tuesday, March 19, 13


9. KAM vs Sales force TARGET

Sustainable development of business with top customers Long-term (3 years)

CUSTOMER POTENTIAL SALES PROCESS Tuesday, March 19, 13

Sales results Efficient delivery Short-term (fiscal year)

1–5

5+

Relationship share of wallet

Transactions efficient pipeline management

Before customers‘ purchasing process (demand & opportunity creation & detection)

Early in customers‘ purchasing process

SKAM13


9. KAM vs Sales force CUSTOMER KNOWLEDGE

market drivers business requirements investment plans

technical requirements decision structure with focus on buying center

decisions & influencing structure

NETWORK COMPLEXITY

high number of internal & external contacts

positions: high-& lowlevel

low-medium number of contacts to be handled internally & at customer positions: medium-low-level

SKAM13 Tuesday, March 19, 13


10. Involvement of the board HIGH reporting structure

in contact with top 90 accounts cultivate contact regular meetings customer participation

“Involvement of board shows commitment to customer centricity, builds trust & provides us with the needs/wants...�

SKAM13

Tuesday, March 19, 13


11. Skills to be successful KAM Relating to others Managing tasks & processes

Leading others

inter-personal understanding customer service orientation initiative information seeking impact & influence organizational awareness relationship building

Managing others Thinking & solving problems

teamwork & co-operation team leadership ability to see the big picture think outside the box

SKAM13

Generic Model of Competencies & Subscales by Spencer & Spencer Tuesday, March 19, 13


12. Reward system BONUS CALCULATION order intake customer satisfaction feedback capacity to secure new strategic deals / new forms of co-operations

‌ vs. sales force: by volume by their BU Tuesday, March 19, 13

SKAM13


13. KAM’s authority/ empowerment Status Quo Official letter when appointed

Guidelines

Favorable reporting structure

relatively high authority

Further empowerment Strengthen internal understanding

P&L Responsability SKAM13

Tuesday, March 19, 13


14. P&L Responsibility ADVANTAGE

Greater authority for KAMs

COMPLICATIONS Key Accounts are highly complex Contracts conditions are negotiated by sales force Interfering long-term targets with P&L targets

GAMs & CAMs should not be responsible for their P&L Eventually RAMs

SKAM13

Tuesday, March 19, 13


15. Account Business Plan CUSTOMER’S BASIC INFORMATION

- Description of the customer - Analysis of the industry - Customer’s SWOT analysis, strategy description

BUSINESS STATUS

ACCOUNT STRATEGY & MEASURES

- SWOT analysis of Siemens vis à vis the customer, - Customer satisfaction - interaction description - Customer’s ongoing projects - Account development strategy - Customer’s business not covered by us - Account penetration by business unit and division - List of top opportunities – action list

SKAM13 Tuesday, March 19, 13


16. Role of KAM in sales process lEAD MGT

Identify/Suggest/Develop leads Help BUs to identify right contract

CONTRACT NEGOTIATION

OPPORTUNITY MGT

Not involved in detail Present in important meetings Explain importance of customer

BID PREP

Offer: What can be provided? Coordination BUs Set up projects’s organization Customer relations mgt

Advisory role Coordination internal/external activities Presence in meetings & negotiations Customer relationship mgt Tuesday, March 19, 13

SKAM13


17. Importance of CRM system CRM key strategic tool in the whole process Share information: company & sales department Categorize & organize clients Maintain & cultivate relationships Avoid redundancy Organize KAM job and relations SKAM13 Tuesday, March 19, 13


18. Relationships & KAM EXTERNAL RELATIONSHIP

GENERAL RELATIONS

New start in relationship Set up workshops Grow with the customer Goal: Siemens as a partner

Few customers Long term Customer relationship network Team work

INTERNAL NETWORK

Misunderstanding of CAM’s added value Sometimes are not informed by BU Share all info Solving internal problems CAM act like role models

SKAM13 Tuesday, March 19, 13


19. From quality supplier to partner EXAMPLE 1 Siemens was a sophisticated product supplier of high voltage equipment.

New relationship: new focus on turnkey solutions Today: partner Partnerships: R&D investments Future goal: real businesses -> maybe with Kratos in solar systems?

SKAM13 Tuesday, March 19, 13


20. Categorizing Kratos LEVEL

- International level - Cross-selling & growth potential

STABILITY

- Av. annual order intake : â‚Ź500mn -Top 10 energy accounts -Account penetration 58%

- Aggressive future investment strategy; BUT reduce costs - market: addressing global mega trend & projected to grow in the future - stable order intake in last 2 years

Global

FIT

-Great strategic fit: renewable energy (EU) & expand presence (outside EU - helps Siemens to gain larger marke shares in specific markets

STRUCTURE - centralized decision making - several businesses - Advisory role of Siemens Tuesday, March 19, 13

SKAM13


21. Revision of O&M contracts PROs Unclosed deals & promising pipeline -> not revising could jeopardize the relationship good strategic fit -> possibility of further expansion Importance of Kratos to other BU’s

CONs Likely to maintain cooperation due to high importance of Siemens as supplier & high switching costs other customers / departments within Kratos might ask for revisions Negative impact on affected BU -> give up current revenue Timing -> 9% drop in order intake would have to be announced at next shareholder meeting

SKAM13 Tuesday, March 19, 13


Should Balton try to convince the FPG division to revise the O&M contracts? CONCLUSION: REVISE ‌ due to high importance, strategic fit & potential SKAM13 Tuesday, March 19, 13


Approach APPROACH Meet face-to-face 2 meetings: CEO of BU + entire BU Explaining reasons why -> be transparent Don‘t push - use good, clear arguments

ARGUMENTS Calculate estimations of pipeline project revenue Show potential of the customer Importance to the company (renewable energy, international expansion, etc.)

SKAM13 Tuesday, March 19, 13


23. Our overall opinion GOOD Practical implementation of Ongoing cultivation of customer customer proximity at the Managing relationships Board level

“businesses start with customers“ “if the customers grow we can grow with them“ “we want to be a trusted and sustainable partner“ SKAM13 Tuesday, March 19, 13


Recommendations Improve internal co-operation & flow of information BU (esp. sales) & KAMs should work together more closely

Eliminate competitive perception to strengthen empowerment

Improve internal understanding of value added by each role

Further suggestions Ensure to foster promising & talented sales employees Provide training opportunities Anticipate market changes & possible implications for KAM program Develop cross-division incentive system, focusing more on the bigger picture instead of P&L targets

SKAM13 Tuesday, March 19, 13


Appendixes

SKAM13 Tuesday, March 19, 13


4. Program Evolution STEP FOUR: 2010 ADD CORPORATE LEVEL 3 levels: regional, global, corporate top-down structure Sales board: four sector‘s CEOs -> decides which vertical markets to focus on, how to adapt the KAM program to market needs, appoints & oversees the Market Development Boards (MDB) MDB: usually specific BU’s CEOs -> meets regularly to discuss where to grow in their market, establish new accounts and set strategy on how to approach customers KAMs

SKAM13 Tuesday, March 19, 13


5. Key Account selection criteria The Key account selection process at Siemens takes into account the following steps: Data - such as customer turnover & installed equipment (usually indicator of after-sales business, e.g. spare parts sales, maintenance services; Industry - if it‘s a growing market, and if the customer was growing in that market; Sales potential & cross-selling opportunities - meaning that if a company can achieve their potential in the next three/four years or so. Furthermore, for the final selection, it is considered: Level of service - consideration if the customer is better served at an international or regional level; Fit - in terms of strategy & culture; Organizational structure - centralized decision making structure? Long-term - stability of the business Tuesday, March 19, 13

SKAM13


7. KAM profiles at Siemens KAM profiles: Regional: dealing with national accounts -> deep knowledge of customer, the country & Siemens‘ portfolio; might not know how to do global framework agreement; reported into local countries organizations where customer had most of its business Global: specialized on specific product portfolio (not on customer or geography); reported to respective BU CEO; very focused view regarding portfolio but speak different languages & know cultures Corporate: cover entire spectrum of Siemens‘ portfolio across different sectors, BUs, geographies; get the full picture; are trained on multiple languages, cultures, full portfolio & how to drive global teams; placed where headquarter of customer is CAMs in HQ report directly to CEO of the BU that had largest foothold on customer CAMs in regions had disciplinary manager who took care of their administration (e.g. salary) in local sector head & functional manager who defined their task in respective BU head in HQ 10 managing board members who follow Siemens‘ top 90 accounts, in contact with respective KAM -> Involvement of board shows commitment to customer centricity, builds trust and provided us with the needs/wants; KAM‘s have further strength“

SKAM13

Tuesday, March 19, 13


8. KAM

SF relations & conflicts

CAMs have to coordinate the relationship between the business unit salespeople and the customer -> architects of a network of relations Some of the BUs might not see the bigger picture; too focused on their own businesses as performance is measured at that level Some salespeople perceived CAM as a threat: CAM is able to mitigate internally & help clear up possible negotiation threats – be the translator of the customer voice CAMs need to know everything about the business which is not always well understood by senior management

SKAM13 Tuesday, March 19, 13


11. Skills to be successful KAM Relating to others

Inter-personal understanding: People person with good communication & management skills Customer service orientation: focus on, foster and maintain customer relationship; act as the clients‘ advocat and trusted advisor; follow up; adress underlying issues; long-term perspective (e.g. trade off immediate costs forsake of long-term relationship); take non-routine actions Managing tasks & processes Initiative: proactively detect leads & opportunities; self-motivated, work independently and set independent goals for themselves; involve others if neccessary, e.g. for in depth knowledge Information seeking: investigate, dig deeper, etc. to detect opportunities Leading Others Impact & influence: Organisational awareness: Able to work across organizational levels & global organizations Relationship building Manging Others Teamwork & co-operation: resolve conflicts; build & drive sales team to professionalize their relationship & follow customer‘s request; involve others Team leadership: create & lead cross-organizational teams of own organization & customers with shared vision, joint parntering and planning; create structure Thinking & Solving Problems: Able to see the big picture & think outside the box Tuesday, March 19, 13

SKAM13


Joana Lemos Lena Luehmann Mariona Prates Cristina Vieites Guillem Meseguer SKAM13 Tuesday, March 19, 13


siemens final presentation