Why engage with senior executives?
Building strong relationships with the customers senior executives within targeted key accounts can help suppliers gain competitive advantage and capture higher value.
In my experience of working with many leading companies that are running account management programmes, executive engagement is often spoken about but rarely executed well.
In this short paper we are going to present guiding principles and practical advice about how best to develop such relationships and how to avoid some expensive pitfalls.
Insights are built from a combination of our experience of initiating and running successful key account programmes for leading organisations together with analysis of best practice methodologies, drawn from respected thought leaders.
Let’s consider three fundamental questions.
- Why engage with your customer’s senior executives?
You may have heard the mantras of ‘selling high’, ‘sell to the power’ and ‘sell to the C-suite’.
What they each refer to is the drive to build relationships and sell through the customer’s senior management team, people sometimes known as ‘executives’.
Why is this group so appealing?
- Richer understanding the of the ‘Agenda’
‘Executives’ influence significant decisions; they guide the supply strategy of the companies they lead and may determine the types of suppliers they work. Their influence is often hidden, but if your key accounts ‘Executive’ are driving costs down, innovation up, expanding into emerging markets or outsourcing, there will be a direct flow into ‘everyday’ supply decisions.
The closer you are to your customers’ senior executives, the better your understanding of your customer’s strategic agenda will be, and the better you can shape your propositions to develop this.
- A focus on ‘value’ rather than price
‘Executives’ shoulder strategic responsibility for their organisation. Their motivation is less about product features and more about enhancing company profitability and delivering broadly based strategic initiatives. ‘Executives’ prioritise key initiatives and have high budgetary influence. They are interested in what benefits a supplier can create – driven more by value upsides than beating price down.
When motivated they can free up budgets, sanction higher spend and promote you as a preferred partner. If they aren’t on board, your customers purchasing team will in all likelihood have less budget to spend and more scope to switch their business away from you.
- Shaping requirements to get ahead of your competitors
Building relationships with senior executives opens up the opportunity for you, as a trusted supplier to help shape the solutions they require. This can utilise capabilities only you provide. You’re positioned to win! One of our clients, the Managing Director of a supplier to the automotive industry, reported that their success rate in winning business was seven times higher when they had proactively worked ‘upfront’ with the ‘Executive’ to ‘design’ the required solution.
- When should your company engage with the customers senior executives?
Companies frequently fail to develop strong relationships with their customer’s senior executives because they lack a true customer focus; they start by thinking ‘what can we learn, rather than ‘how can we best help the senior executive achieve their goals’.
So, in terms of timing when should you start executive engagement? Three guidelines
- Start when you offer value.
Your customers executives are busy and they will quickly wish to learn what is in it for them.
A leading supplier of beverage equipment targeted and eventually arranged a meeting with the CEO of a leading soft drinks company. They were met with the challenging welcome. ‘Unless you are here to tell me about cost reduction or innovation, this meeting will be a waste of my time’.
Busy executives rarely see suppliers for a second time or tell them about their needs unless they perceive up-front that the supplier has delivered value and will deliver even more in the future.
Share the value you have created early.
- Proceed when you are ready internally.
Unfortunately, we have uncovered some alarming examples of meetings being held with customer’s senior executives, where the people involved from the supplier were inappropriate in terms of level and customer relationship skills. Suppliers generally need to pull in a senior sponsor from their own executive team to create a ‘top-to top’ match. Such relationships hold a gravitas which opens up strategic and expansionary conversations
We’ve also seen mismatches between the ‘promises’ that suppliers make in these high-level meetings and the practical constraints of operational delivery. Internal alignment and co-ordination is vital.
Key account managers must take hold of this, steering all executive contacts.
- At the beginning and end of key projects.
In the decision cycle for any major project, senior executives tend to be heavily involved in the early phases, where a need is identified and there is the requirement to formulate a broad plan of attack. Once a project gets under way, the ‘Executive’ leave the execution of the project to their teams. They may then become involved again at the end of a project when it’s time to measure what was achieved. ‘Top’ and ‘tail’ are good times to demonstrate your value.
- What drives the senior executive’s agenda?
We asked senior executives across our clients why they had favoured various suppliers to run key initiatives with them we received a common response. ‘I knew I could work with them, and they wouldn’t let me down’. Emotion and logic, upsides and risk mitigation all count.
- Company agenda
There is certainly a need to understand a customer’s position e.g. Is the company in growth mode? Are they expanding into new markets or are they dealing with new competitors? Be aware of all these factors and be sensitive to them.
- Personal agenda
It’s also good to understand the senior executive’s personal agenda. Are they looking to climb the corporate ladder, develop an innovative culture or avoid major risks? Are they hands-on or do they seek to delegate and support? The ability to hit all the right buttons will elevate you in their eyes to the status of someone who can make the desired contribution rather than someone who just wants to sell products.
- Credibility, flexibility and trust
Executives are busy and they frequently need to take decisions and base choices on incomplete information. Demonstrating your credibility and then showing that you are good to work with, flexible, focused on their requirements and ‘won’t let them down’ are differentiating ‘order winners’.
Strong relationships with senior executives in key accounts can be very valuable. They open new doors to opportunities and can help the flow of day to day business.
They require planning and disciplined management but the rewards can be exceptional.
Author: Alistair Taylor is a member of AKAM and a Partner at Brightbridge Consulting. He combines the experience of implementing highly successful key account management programmes as a business leader, with experience gained from delivering customer development consulting and training for top global organisations. He’s an expert in customer conversations.