So many accounts so little time. You’re probably thinking…not a bad problem to have. And I agree. But this issue routinely presents companies with several important decisions. Which accounts do I assign to my best people? Which accounts are worth salvaging when issues arise? What kind of salesperson do I assign to my accounts that are strategically valuable, but troubled? Do I provide special training to these salespeople? The list of questions or decisions to be made goes on and on.
The impact of a company’s answer to these questions lands squarely on the bottom-line. An article titled “Working Knowledge” by Robert Kaplan suggests that approximately 40% of customers represent 120% of profit dollars. The remaining 60% add no profit dollars or actually detract from a company’s total profits. So, make the wrong decision about which accounts to invest in and you handicap your company’s ability to grow profitably.
Recognizing the importance of this decision, at Walker, we have developed a framework that enables companies to consistently (account-to-account) determine the total strategic value of each customer. The three keys are in the criteria we use to determine the strategic value of an account. We call the components the 3 P’s.
Understand where each of your accounts resides on these three dimensions and you’re well on your way to helping your company make its most important resource and investment decisions.
Senior Vice President