某咨詢利用大客戶管理獲取市場機會

UsingKeyAccountManagementtoCaptureMarketOpportunitiesMarch2002CONFIDENTIALThisreportissolelyfortheuseofclientpersonnel.Nopartofitmaybecirculated,quoted,orreproducedfordistributionoutsidetheclientorganizationwithoutpriorwrittenapprovalfromMcKinsey&Company.ThismaterialwasusedbyMcKinsey&Companyduringanoralpresentation;itisnotacompleterecordofthediscussion.Clientdiscussion/LOPonmulti-levelsalesimprovementprogram(SSP/salesperformance,cross-sellingandcoordination,solutionsandverticalpackaging)SALES&CHANNELPRACTICEJOHNABELE-CL,MIKELONGMAN-CLINTRODUCTIONFollowingisasampleclientdiscussion/horizontalLOPthatoutlinesamulti-levelsalesimprovementprogramthatincludes:Frontlinesalesperformanceimprovement/betterintra-unitmanagementoflargecustomersCross-sellingandsalescoordination(typicallyacrossunits)SolutionsandverticalpackagingWithkeyaccountmanagement(KAM)asanenabler.ThisdocumenttakesacomprehensiveviewtosalesimprovementandKAM;however,KAMorothersalesimprovementeffortscanandoftenareshorterormorenarrowlyfocused.Inaddition,inthisparticularexample,wehaddeepknowledgeoftheclientsituationthroughpreviousstrategyandpricingstudies,asrepresentedontheexamplepagesattached.Thismightnotbethecaseinyourclientsituation.Formoreinformationontheseandothersalesandchanneltopics,contacttheNorthAmericanSales&ChannelPractice.1TODAY’SDISCUSSIONOverviewofkeyaccountmanagementPerspectivesontheopportunityBasicbeliefsandapproachSelectedexamplesDiscussasuggestedapproachDiagnosingtheopportunityBuildingthecapabilitiesandcapturingnear-termvalueDesigningtheorganizationResourcerequirementsHighlightMcKinseyqualificationsFirmexperienceandresourcesUnderstandingofyourcompanyFieldquestionsanddiscussnextsteps2TODAY’SDISCUSSIONOverviewofkeyaccountmanagementPerspectivesontheopportunityBasicbeliefsandapproachSelectedexamplesDiscussasuggestedapproachDiagnosingtheopportunityBuildingthecapabilitiesandcapturingnear-termvalueDesigningtheorganizationResourcerequirementsHighlightMcKinseyqualificationsFirmexperienceandresourcesUnderstandingofyourcompanyFieldquestionsanddiscussnextsteps3SUMMARYPERSPECTIVES(note:KAMinthisexampleisonepartofthelargermulti-levelsalesimprovementprogram)Ourexperiencewithsalesimprovementeffortsindicatesthatimprovingsalesandgo-to-marketrelatedactivitiesisoftenahugevalueleverforcompaniesInitialestimatessuggestthatanincrementalsalesopportunityofover20%mayexistApproximately50%oftheopportunityinanyareaisachievablewithin12monthsofimplementationKeyAccountManagementisonlyonepartoftheanswer.Achievingtheseresultsrequiresamulti-levelsalesimprovementprogramincluding:Improvedsalesforceperformance/salesstimulationCross-sellingandsalescoordinationSolutionsandverticalpackagingInundertakingakeyaccountmanagementeffort,yourcompanyshouldensurethattheeffortisFoundedinadeepunderstandingofcustomers’realneedsandwhattheyvalueinsuppliersClearlyidentifiesthenatureofthesalesimprovementopportunityforeachcustomerrelativetocompetitivealternativesTailorsthego-to-marketandkeyaccountapproachtofittheopportunityBalancesnear-termvaluecapturewithbest-in-classskillbuildingTracksperformanceandenforcesaccountability4IMPACTFROMSALESIMPROVEMENTISSIGNIFICANTSalesforceperformanceandstimulationCross-sellingandimprovedsalescoordinationSolutions/verticalapplicationsOpportunitysizeImprovementleverTypicalcapturerate60-100%inaddressedareaswithin6-18months,dependingonbuyingcycles~6-18monthsinareasaddressedOftenmore

intra-divisionthaninter-division~12-36monthsWinnersfocusondrivingasmallernumberofhighpotentialopportunities

McKINSEY

CLIENT

EXPERIENCEMedian10%revenueincrease1/25-10%improvement1/2>10%improvementReductioninsalesrelatedcostsof5-10%ormoreOpportunitiesexistin20-40%ofcaseswitha10-20%successrateTypically10-20%ofcustomersarepotential“solutionsbuyers”Conversionratesoftenin20-30%rangeRevenues1.5-5Xcurrent,dependingon“solution” Source: McKinseyMarketingPracticeKeyaccountmanagementcanbeanenableracrossallofthese5ROUGHESTIMATEOFTHETOTALSALESIMPROVEMENTOPPORTUNITYFORYOURCOMPANY(disguisedexample)Incrementalsales$Million

Source: TeamanalysisSalesperformanceCross-sellingSolutionsTotalopportunity500-1000200-800950–2,400250-600Opportunityfor

~10-15%increaseinrevenuesfromsalesimprovementprograms

Grossmarginimprovementof

~$300-500millionActualresultswilldependon:ScopeofeffortPaceofprogramExecutionquality6Manycompanieshaveadoptedsomeformofkeyaccountmanagementasameanstobreakoutofproductsilosandcaptureincrementalvaluefromsomeoftheirlargercustomers.Quiteanumberhaveachievedrealincreasesthroughcross-sellinganddevelopingcommercialand/ortechnical“solutions”forcustomersHowever,wehaveseenmanyclients“over-invest”inaccountmanagementstructuresandprocesseswithoutgainingmuchbenefitbecausetheyputinplaceonesizefitsall“accountcoordinators”withoutaclearideaofhowtheymightcreatevaluefordifferenttypesofcustomersorthecompanyWhendevelopingakeyaccountprogramwetypicallytakeaverycustomer-focused,market-backapproachandfollowasimple4-stepprocessIdentifyrealnatureofopportunityatoverlappingcustomers/segmentsEngageinacustomer-levelaccountplanningefforttoensurevalueandbetterunderstandtheskillsrequiredtocaptureitClarifydecisionmaking,coordinatingprocesses,incentives,andmakestructuraldecisionsRolloutnewstructureandprocessesBASICBELIEFSABOUTKEYACCOUNTMANAGEMENT7HighercustomerconcentrationConsolidationBuyinggroupsIncreasedcustomerdemandforcoordinationacrossmarketsWithinNorthAmericaWorldwideGrowingcustomerrequirementfordeepersupplierrelationshipsPurchasingeconomicsofscaleSupplychaininitiativesMoreintensecompetitionforsellingto“prizeaccounts”CustomersactivelyreducingthesupplierbaseCustomersraisingrequirementsforserviceandcostperformanceSomecompetitorswillingtodo“whatittakes”towinthebusinessGreatercomplexityofproduct/serviceofferingsIntimateunderstandingofcustomerbusinessandproductsrequiredtodeliverpromisedvalueMoredecisionmakersinvolvedinpurchasingprocessStandardizationeffortsbroadendecisionmakingbaseMulti-tiercoordinationoftenmoreimportant(e.g.,HQandfield)Newroleand

importanceof

keyaccount

managementKEYACCOUNTMANAGEMENTISINCREASINGLYPARTOFTHESALESAPPROACH8OftencompaniesviewKAMwitha“wepay”viewandtakeactionsthatdestroyvalueDedicatedaccountteamswhennotneededSpecialservices/productstoallkeyaccountsUnprofitablepricing/discountingAnythinggoesinthenameofpartnering“Weknowourcustomers andtheirneedswelland aredevelopingnew methodsofvaluecreation”“Weareagreatsalesand marketingteam”“Wehaveagoodlongterm win-winrelationship”MANYCOMPANIESHAVEFAILEDINUNDERTAKINGKAMPROGRAMS9SUCCESSBEGINSWITHADEEPUNDERSTANDINGOFCUSTOMERSANDYOURVALUEPROPOSITIONCustomerknowledgeValuepropositiondesignSalesandchannelstrategyPricingWhoaremycustomers?CurrentandpotentialPurchasersandinfluencersWhatproducts/servicesdotheybuy?NowandfutureWhatdoweofferandwhatcanweoffer?Whatdotheyneed?KnownandlatentHowdotheybuy?CurrentandpotentiallyElementsofanintegratedgo-to-marketapproachFundamentalquestions10NATUREOFTHEOPPORTUNITYAVAILABLEFROMCOORDINATEDACCOUNTAPPROACHIncreasesatisfaction/decreasego-to-marketcostbyleveraginginformation/supportresourcesProduct/serviceofferingsheavilylinkedProduct/serviceofferingsremaindistinctIntegrationCoordinationInformationexchangeDevelopandsell“turnkey”solutionsAssemblecomponentstogetherinuniquewaytomeetcustomerspecificneedsAchievepenetration/retentionbyexplicitlylinkingcommercialtermsofoneproduct/servicetransactiontoconsiderationsonanotherproduct/serviceStimulatereferrals/cross-sellingtoincreaseprobabilityofstand-alonesalesTakingone-timeactiontouserelationshipinoneareatobecome““qualifiedsupplier””inanother11CHOICEOFSALESANDCHANNELSTRATEGYPotentialgo-to-marketapproachAdvantagesMarket-orientedBUwithcompleteP&LauthorityCommonfront-endsalesforceacrossall/mostproductgroupsOverlayaccountmanagementgroupwithsigningauthorityOverlayaccountmanagementgroupswithoutmanydecisionrightsAssignmentofleadunitformulti-unitaccountsCoordinatingprocessesandincentivesforindependentunitsProvidesafocalpointwhocanorganizecustomertouchinthemosteffectiveandefficientwayBalancesneedto““package””andneedtohavespecialiststiedtoproductgroupsProvidesfocalpointforaccountplanning/coordinationAllowsforaccountplanningwithless“overhead”StimulatesreferralsandcollaborationwithoutbureaucracyCandevelopcompletepackageforcommonsetsofcustomers12CLIENTEXAMPLE:OVERLAYACCOUNTMANAGEMENTTOCAPTURESOLUTIONSOPPORTUNITYCompanyChallengeActionsSegmentedaccountsintotiersbasedonsize,growth,strategicimportance,needsEvaluatedsalesfunnelfortop50accountsaswellasforsmalleraccounts,anddevelopedtailoredaccountstrategiesandteamapproachforeachDeployedgeneralistkeyaccountteamsfocusedongrowingbusinessattop50accountswithproductspecialistsprovidingsupportasneededanddedicatedtelesalesrepsforretentionImpactBeforeProgram6monthsafterimple-mentationShareofWalletforpilotaccountsintop50Index100108-1208-20%LeadinghightechcompanySalestolargeaccountslaggingduetofocusonretentionovernewopportunityidentificationDeveloptailoredaccountstrategyfordifferentaccountsegmentsandteamapproachtodrivesalesandshareofwallet13SalesanddistributionorganizationConsultingServersSoftwareServicesBusinessunits(BUs)OrganizationSales&distributionorganizationpartofcorporateoverhead,formsteamwithsalespersonnelfromBUstomeetclientneedsBUsretaintheirownP&Ls,selltobothinternalandexternalcustomersIncentivesBUproductspecialistshavequotasacrossmanycustomeraccounts,includingbothsolutionsandcomponentsalesSales&distributionaccountmanagershavequotasfortheirindividualcustomeraccountsQuotassetonlybyseniormanagementPricingList-basedpricingprimarilyusedSomeconcernoverwhoeatsthediscountwithsolutionsalesComplicated,customer-specificpricingasprofitmarginsvarywidelybetweenBUsSkillsetsforaccountmanagersHiredasindustryexpertsSolidseniorclientrelationsCross-functionaltrainingismanageablebecausetheyaresupportedbyspecialistsandconsultantsMicroelectronicsDrivesclientrelationshipandhasdeepindustryexpertiseCoordinatesspecialistsandconsultantsUsedfordeepproductexpertiseforsolutionsalesResponsiblefordirectsalestosingleproductcustomersDevelopindustry-specificsolutionsCustomizethesolutionsforspecificclientneedsSolutionscustomersSalesSalesSalesSalesKeycharacteristicsREVISEDCLIENTSALESORGANIZATION14USINGLEADUNITSFORKEYACCOUNTMANAGEMENTFORCROSS-SELLINGANDLEADSHARINGCompanyChallenge400potentialaccountsnarrowedto50basedonsizeofopportunityandeaseofaccountaccess/penetration,thenfocusedon15ofmostinteresttoBUleadersCreatedfull-timeexecutivelevelpositionatcorporatecentertomanageandroll-outprogramMadesalespersonwiththestrongestrelationshipinaccountthepointpersonforKAMactivities––didnotcreatenewpositionEstablishedguidelinesforincentives,metrics,reportingstructure,rolesandgovernanceActionstakenImpactGlobalmulti-businessunittechnology/industrialmanufacturerSixbilliondollarBU’sthatmakeproductsthatcouldbesoldintothesameendmarketBeforeKAMvirtuallynocross-businessunitcollaborationBuyersfordifferentproductsoftennotthesameSalesforceperceivedriskofopeningaccountasfaroutweighinganypotentialsalesincentiveIdentifiedopportunitiestocapture$3-4billionincrementalsaleswithin3yearsBeganclosingdealswithin6months,afterinitial“ramp-upandroll-out””periodClosed9majorcross-businessunitdealswithinfirstyearOpportunitiescapturedtodatehavebeen100%incrementalsales15MarketorientedBUwithcompletep&lauthorityCommonfront-endsalesforceacrossall/mostproductgroupsOverlayaccountmanagementgroupwithsigningauthorityOverlayaccountmanagementgroupswithoutmanydecisionrightsAssignmentofleadunitformulti-unitaccountsCoordinatingprocessesandincentivesforindependentunitsTraditionalsalesrepresentativesanddistributorsAPPROPRIATEGTM/KEYACCOUNTAPPROACHAFUNCTIONOFNATUREANDSCOPEOFOPPORTUNITYPotentialgo-to-marketapproachTypicalscopeofKAMeffortsInfoexchange/costreductionQualification/one-timeactionCross-sell/referralCoordinatedaccountstrategyUniquetechnicalsolutionsTurnkeysolutionsLikely““overkill””CostingmorethanbenefitscreatedPossiblyreducingeffectivenessofcomponent-onlysaleLikelyinsufficienttoaccomplishobjectivesRealisticoptionsNatureofOpportunityü?üüü?ü16KEYCONSIDERATIONSINCREATINGTRUEACCOUNTMANAGEMENTLosersAllkeyaccountsalike;““Band-Aid””organizationalchangesBigaccountsgetmostattentionSales/marginfortransactionJudgment-baseddecisionsShort-termaccountplanning;reactingtoopportunitiesRelationship-drivenmodelLeveragingsalesRelyingonnegotiationskillstoextractvalueMinimalmarketfeedback;one-waysalescycleWinnersTailoreddeliverysystems“Highestpriority””toaccountswithgrowthpotentialLifetimeprofitability/marketvalueFact-baseddecisionsLonger-termaccountstrategies;identifyinganddevelopingopportunitiesValuecreationandpartnershipmodelLeveragingorganizationRelyingonunderstandingofjointeconomicstooptimizevalueCustomerandfieldfeedbackloopsfeedanongoingprocess17TODAY’SDISCUSSIONOverviewofkeyaccountmanagementPerspectivesontheopportunityBasicbeliefsandapproachSelectedexamplesDiscussasuggestedapproachforyourcompanyDiagnosingtheopportunityBuildingthecapabilitiesandcapturingnear-termvalueDesigningtheorganizationResourcerequirementsHighlightMcKinseyqualificationsFirmexperienceandresourcesUnderstandingofyourcompanyFieldquestionsanddiscussnextsteps18Phase2~3months(variesbyprogram)Phase3LaunchtheorganizationofthefutureExecutionwithtargetcustomersets8weeksOVERVIEWOFSUGGESTEDAPPROACHFORKAMENGAGEMENTPhase1Timing6weeksActivitiesScopeBuildthecustomerknowledgebaseOpportunityassessmentandprogramdesignBegintobuildthemarket/customerknowledgebaseUnderstandsegmentandcustomeropportunitiesEvaluatecapabilityandchangereadinessChoosecustomersetsanddesignexecutionphaseDeveloptheaccount-levelfactbaseExecutekeyaccountmanagementpilotsAssignroleandresponsibilitiesEngageinpilotaccountplanningDeveloptacticalactionplansExecuteinitialaccountactions,evaluateandrefineplansInitiatelongertermaccountactionitemsCompleteand““golive”withcustomerknowledgebaseOutlinescopeandnatureofremainingopportunityDeterminego-to-market/KAMstructureClarifyprocessesandsupportingmechanismsBeginfull-scaleimplementationOpportunitiesselectedinPhase1Solutions/verticals-based(e.g.,oilandgas,utilities)Cross-sellingfocused(e.g.,multi-buaccountsinIAS,ControlsandPoweroverlaps)Salespenetrationatmajoraccounts(e.g.,Compaq,Whirlpool)Subsetofcustomerbasefromacrosstheorganization,including:Multi-divisionalaccountsMulti-buaccountsSingle-buglobalaccounts?Company-wide,high-levelgo-to-marketorganizationdesignPurposeIncreasesuccessfrommarket-back,opportunity-drivendesignCreatemomentumthroughearlywinsBeginbuildingcapabilitiesEstablishlonger-term,experience-basedsolution19PHASE1DETAIL:OPPORTUNITYASSESSMENTPHASETimingActivitiesBegintobuildthemarket/customerknowledgebaseUnderstandsegmentandcustomeropportunitiesEvaluatecapabilityandchangereadinessChoosecustomersetsanddesignexecutionphaseOpportunityassessmentandprogramdesign1week3weeks1week1weekAssemblebasic,internalcustomerinformationOutlinecustomerinformationrequirementsAssessavailabilityofadditionalinformationandbegincollectionprocessCompilelistofyourcompanyofferingsandcapabilitiesSynthesizeallavailableinformation(e.g.,salesperspectives,financials,previouscustomerinterviews,externaldata,etc.)intosegmentandcustomerattractivenessDeveloppreliminaryviewofopportunityandlikelyapproachforcaptureEstimatemagnitudeofopportunityAssessmanagementandorganizationreadinessSkillfornewtasksWilltochangeandtrynewapproachEstimatetimingofimpactMapopportunityattractivenessversusfeasibilityforpilotSelectinitialcustomerssetstobeginOutlineresourcerequirements,process,andtimingRefineworkplans,tools,andapproachGainagreementtoproceed20CUSTOMERSEGMENTATIONBASEDONATTRACTIVENESSCurrentsalesvolumeGrowthpotential-shareofwalletandorganicCompetitivelandscape(thecompany/customerfit)Customersegmentationbasedonattractiveness“Key””“Major”“Core”CustomerwillingnesstopartnerwiththecompanyCurrentandfutureestimatedprofitability21PRIORITIZINGCUSTOMERSETSBYNATUREOFOPPORTUNITYOpportunityattractivenessFeasibilityforpilotLowHighHighLowKeyfactorstoconsiderSizeofsalesopportunityEstimatedprofitabilityCompetitiveintensityandreactionDistinctivenessofpotentialvaluepropositionKeyfactorstoconsiderTimingforimpactCapabilityandcommitmentofmanagementOrganizationalskilllevelAccesstocustomersetsSolutionsCross-sellImprovemajoraccountsGlobaloil&gasproducersWhitegoodsmanufacturersCustomerswhobuysensorsanddrivesComputerandserverOEMs22PHASE2DETAIL:EXECUTIONWITHTARGETCUSTOMERSETSTiming2-3weeks4-6weeks2weeks2-3weeksTBDActivitiesDevelopdetailedaccountlevelfactbasefortargetedcustomersetCustomerinformationAccountperformanceCompetitiveassessmentStrategicissuesandopportunitiesDetailactionsandtimingforallrequiredareasSalesandmarketingEngineeringManufacturingIdentifyrequiredresourcesPeopleSkillsAssembletheteamacrossbu’s/divisionsCreatetacticalplanandassignmentsFinalizespecificmetricsRevenueMarginsTimingExecuteneartermand“quickhit””actionsTrackprogressagainstplansIterateaccountplansand

re-initiateactionsasrequiredHighlightprocessandaccountsuccessesandfailuresSynthesizekeylearningsasinputfororganizationdesignLaunchlongertermactionsMonitorprogressRefineaccountplansasnecessaryEnsureaccountabilityVerify/refinenatureofopportunityOutlineaccountstrategyandapproachEstablishaccountlevelaspirationsClarifyaccount-specificproduct/servicevaluepropositionEstablishpricingConducteconomicmodelingIterateRefinetheopportunityandaccountstrategyDevelopthetacticalaccountplanExecuteinitialaccountactions,evaluateandrefineInitiatelongertermaccountactionitemsExecutionwithtargetcustomersetsDeveloptheaccount-levelfactbaseEngageinpilotkeyaccountplanning23ACCOUNTLEVELFACTBASETEMPLATEAreaIssuestoexploreCustomerperformanceandstrategyOurperformanceinservicingthecustomerOurpositionwithcustomerrelativetocompetitorsWhatisthecustomer’’soverallbusinessstrategy?Howisthecustomerperformingfinancially?Howisthecustomerperforminginthemarketplace?Whatisthecustomer’’sproductlinestrategy?Whatisthecustomer’’sproductionstrategy?Whatisthecustomer’’ssourcingstrategy?Whatisthecustomer’’ssourcingorganizationandprocess?Whatshareofwalletarewereceiving?Howmuchprofitdowemakefromthiscustomer?Wheredowestandwithkeydecisionmakers?Howhavewedoneinrecentnegotiations?Howdidweperformagainstlastyear’’splan?Whatareourcustomersneeds?Howwelldowemeetthoseneedsrelativetocompetition?Whatareourcompetitors’’likelystrategiesforthisaccount?* Reactor,extruder,purifier,orotherprocessunitthatisthe““bottleneck””intheprocessPotentialanalysesStatementofcustomerobjectives,SWOTStockpricetrends,ROCEMarketsharetrendsTimelinebyplatformBuildprojectionsbyplatform&locationSupplierlistbycomponent&geography,customeraffiliations,consolidationeffortsOrgchart,keydecisionmakers,keybuyingfactors,selectionprocess,recentnegotiationreviewsAccountsharetrendsinunitsandrevenueProfitabilitytrendsinOP,pocketmargin,NPVRelationshipmappingandstrengthevaluationWon/lostbidanalysisandreasonsPerformancevs.objectivesPrioritizationandweightingofkeybuyingfactors,technicalinnovationprioritiesValuemaps,competitiveperfo24ACCOUNTPLANNINGSUMMARYCUSTOMERXKeyfindings:volumeandmarginshavedecreasedsignificantlyascompetitorpresencehasintensifiedRecommendations:leveragerelationshiptoregainandsurpasshistoricalposition1996199719981999YTDPoundsRevenuesMargins($Millions)2000est.*Importantsupportingfacts:summarySalesandmargins:historicalandprojectedPenetrationbreakout––Product1PercentCompany1Product1100%=9millionlb.Product2100%=310,000lb.ClientCompany1ClientOtherProduct1100%=9.3millionlb.Company1Product2100%=320,000lb.986* Assumesaveragepriceandmarginfor19992,0573,2441,3322,2401,1781,7796368013,0003,778Company2Company3ClientOtherCurrentTargetCompany1ClientCompany3Company2SituationsummaryAccounttypeGoalsfor2000Nocrossdistrictisahigh-margin,large-volumeaccountwithadominantpositioninagrowingmarket.ThecompanyhasbeenunabletoretainitspositionovertheyearsKeyBecomecustomer’sNo.1supplier.Obtain30%penetrationinproduct1andmaintain85%penetrationinproduct2KeyactivitiestoachievegoalsResponsibilityTimingIntroducepilotVMIprogramto“thezone””warehouse(solesource)withdelayedbillingtiedtoinventoryturnsIntroducedifferentiatedpricingforFTL,fullpalletbusinessSupport/reengageinjobbusiness(reach(30%hitratio)ContinuetohelpthemwiththeircustomersJuly-December1999August1999YearroundYearroundProfitabilitydrivers1998￠/lb.PocketmarginFreightcostsMSCcostsARcarryingcostsn/a1998￠/lb.vs.benchmark10.0above0.24below1.60above0.90above2000target￠/lb.vs.benchmarkSame1.0belowSame1.9aboveEarnedcostsavings=standard3%(withvolume>300,000lb.)Paymentterms=75days(duetonationalagreement)ALBWaspercentageoftotalBWlb.=23%FactorScoreBelowaverageAverageAverageBetterBetterBetterAveragen/aAboveaverageAboveaveragen/aPricingQualityPaymenttermsDeliveryOntimeFillrateLeadtimeProductlineInventorymanagementSalessupportTechsupportPromofundsPerformancerelativetocompetitorsacrosskeybuyingfactorsActionsMust““provecompetitivepricing–TermsnegotiatedwithNationals.MaywanttoextendtothisdistrictinconnectionwithVMItozoneAdjustdownwardwhereapplicable–InstituteVMIforwarehouse1(thezone)Maintainrelationship––Importancetocustomer++–++00+–++++–Company’spositionsummaryOnlybuildingsupplierwithlong-termrelationshipsProductline2GooddeliveryserviceInconsistentpricingProductdevelopment(outsideofcorebusiness)Convenientlylocatedtoservice““fill-involume”New““zone”warehouselocatedonly20milesfromplant/MSCCompetitorsbetterpositionedforproduct2““willcalls”CompetitorshavestrengthenedrelationshipsStrengthsWeaknessesOpportunitiesThreatsCLIENTEXAMPLE25PHASE3DETAIL:LAUNCHORGANIZATIONOFTHEFUTURETimingActivitiesOutlinescopeandnatureofremainingopportunityDeterminego-to-market/KAMstructureClarifyprocessesandsupportingmechanismsBeginfull-scaleimplementationLaunchtheorganizationofthefuture2weeks2weeks4weeksTBDMinecustomerinformationandlessonslearnedfrompilotphasesIdentifylikelyopportunitiesforremainderofcustomerssetsSizethemagnitudeandscopeoftheremainingopportunityTranslateopportunityintorequirementsfor““front-endofbusiness””Assessabilityofalternativego-to-market/KAMapproachestocaptureopportunityIdentifyany““back-endofthebusiness””constraintsDefinedetailedstructureRolesResponsibilitiesOutlinestaffingneedsandskillrequirementsCreateapproachfor:TransferpricingIncentivesP&L’sResourcedeploymentInformationflowSupportsystemsOutlineimplementationandtransitionplanLaunchrequiredchangesMonitorandtrackprogressEnsureaccountability26*Regionalsales/marketingstructurecomposedofregionmanager,countrymanagersandaccountmanagerswithincountriesProjectmanagerProjectmanagerEuropeChinaU.S.ServicesgroupMarket/salesregions*(MOs)Accountmanager(KAM)ProjectmanagerProductmanagerAccountteamSystemmarketingProductunit1BaystationsProductunit2SwitchesProductunit3HandsetsProductunits(PUs)ServicesKeyprocessesandmechanismsAlltransferprices(TP)andrecommendedglobalreferenceprices(GRP)setby10peopleinproductunitsandstrategicplanningProductmanagersselltheirproductsandservicestotheKAMatTP(noauthoritytoadjustTP),KAMthenmakesfinalpricing/trade-offdecisionstocustomerKAMandproductmanagersbonusbasedon50%localand50%consolidatedmargin,sonoonegroup““eats””discountAccountstrategyanddisputesdecidedinmonthly““keyaccountboard”meetingsattendedbyproductVPs,marketVPs,andcountryheadsTPdiscussionheldonlyatPUandMOheadlevel(nodiscussionsbetweenKAMandPMs)KAMhave““l(fā)icensetohunt”withcustomerafterwinningaccountEXAMPLENOKIASALESORGANIZATIONANDMECHANISMS27TRANSITIONCHALLENGESNEEDTOBECAREFULLYMANAGEDCustomersUseopportunitydefinespecificationsandensure““right”teamisinplaceUseseniorexecutivevisitsasbasisforexploringnewareaswithcustomersDuringtransitionsteamleadmonitorscustomersatisfactiononamorefrequentbasisSalesrepsOver-communicate/involvesuperrepsindesignTestvalueof““doublecredit””forsalesresourcesforteamingSourceteamleadersinternally/externallytoget““right”skillsInvestinextensivetraining,butonlyforhighpotentialreps;hireexternallytofilladditionalpositionsSpecializedtalentRoll-outnewapproachtoonlyasmanyteamsassufficientquantity(scale)andquality(skills)ofspecialistsisavailableOrganizationDefinenewmetrics(outputsand“drivers”)tomeasurejointteamperformancePilotchangesin1-2accountsbeforerollingouttominimizerisk/teamAdjustbudgeting/planningprocesstoincludecross-organizationresourcesandensuresynchronizationoftargetsApproachesfortransitionplantoaddresscriticalchallengesCLIENTEXAMPLE28PROPOSEDPROJECTORGANIZATIONANDRESOURCESSteeringCommitteeTaskForceAdditionalMcKinseyResourcesB2BMarketingPracticeCompanyClientServiceTeamResearchandInformationDept.RelevantindustryPractices,e.g.,AssemblyandAutomotiveTelecomEnergyAdditionalyourcompanyResourcesSalesMarketingEngineering/DesignFinanceITCorporateLearningCoreTeamLeadershipMcKinseyCompanySelectedDivision/BUSalesLeadersWorkingTeam-Assessment,1stPilotandOrganizationPhasesMcKinseyCompany