Whether you’re struggling to survive the pandemic or thriving and experiencing unprecedented growth, one thing is clear: We are experiencing radical shifts in how we conduct business with our most strategic customers. As conveners of the largest community in the world dedicated to strategic and key account management, one of SAMA’s foundational purposes is to help our community both adapt to what’s happening right now and prepare for what may happen next.
At the 2020 SAMA Annual Conference (held virtually Nov. 9-11, 2020), we pulled together a group of the smartest, most sophisticated observers, students and practitioners of strategic account management for a conversation on “The Future of SAM.” Highlights are presented below, and the full panel is available on demand by registering for the virtual conference here.
Moderator: Jim Ford, Chief Commercial Officer, Solecta, and Chairman, SAMA Board of Directors
Panelists: Jennifer Stanley, Partner, McKinsey & Co.; Dino Bertani, Executive Director, International Strategic Account Management, Allergan Aesthetics; Harvey Dunham, Managing Director, Strategy and Marketing, SAMA; Tom Hablitzel, Senior VP, Enterprise Clients, Sherwin-Williams Company; Jim O’Leary, Global Practice Chair, Corporate Affairs, Edelman
#1. Shifting from focus on shareholder value only to stakeholder value as well – and a broadening understanding of what stakeholder value means.
O’Leary shared takeaways from Edelman’s most recent Business Roundtable, which highlighted the growing emphasis placed on a company’s role in society – from environmental impact to social justice and diversity/inclusion. Non-traditional sources of value will play a growing role in how stakeholders evaluate the impact of companies and their strategic accounts efforts.
#2. Sales and account management – no longer an expense but an investment.
While firms once viewed sales as an expense, in this environment it’s clearly an investment. O’Leary’s advice: Projects with the best “story” will be funded and resourced first. His other advice:
Expand whom you interact with at your customers
Focus more than ever on active listening. Only by making astute observations will you uncover potential new sources of value.
Make sure your internal stakeholders understand the value your program brings to customers and, through them, to the firm. If they don’t grasp it, you may become the target of cost cutting and/or restructuring.
#3. Centralized beats decentralized.
When companies shift their programs into the regions or business units, Bertani says, you risk adding inefficiencies, redundancies and opportunities for misalignment. You also risk sacrificing a common strategy, methodology and customer experience.
#4. SAM will become (if it isn’t already) the standard bearer for all sales.
From Stanley’s perspective, SAM already serves as a beacon for what it means to be a sales professional–particularly when it comes to the rigor SAMs bring to account planning, solutions co-creation with customers and articulation of unique value propositions.
#5. Centers of Excellence (CoE).
Bertani says these centralized groups of SAM experts can and should be leveraged as the catalyst for instilling the mindset, skill set and processes for distinctive go-to-market and customer-centric engagement models.
#6. Agility is the new stability.
In disruptive times, leaders need to increase their organizations’ agility by focusing on what really matters and making much faster decisions. Bertani recommends trading perfection for simplicity. “I’d rather be approximately right,” he says, “than exactly wrong.”
#7. Those who have the data, and use it wisely, will control the playing field.
If you’re accumulating data on your customers and even your customers’ customers, how are you using it to develop insights that lead to innovative value propositions? How are you linking it to your core business strategy?
#8. In just a few months, COVID accelerated digital adoption as much as 10 years.
What this means is a vast proliferation of data on customer behavior. Those companies that both control the data and utilize it most effectively to glean customer insights will be the ones who will control the playing field. Stanley predicts that digital adoption will spare SAMs from much of the day-to-day “firefighting” of the job, freeing them to look into all this new data and distill it back into insights about their customers.
#9. The profile of strategic account teams will shift dramatically.
New and different skills will be needed to analyze all this new data and make use of it, leading to teams that include not only data scientists but also behavioral scientists and others with non-traditional sales skills. Teams will also need to become flatter, less hierarchical, in order to move quickly and with agility.
#10. Customers will reward suppliers who successfully blend a great digital experience with the human touch.
When McKinsey surveyed B2B buyers to see whether they prefer to buy digitally or from people, the answer, overwhelmingly, was “it depends.” Turns out customers are much more likely to reward suppliers with sole-source contracts when they excel in both areas and know which channel is right for which kinds of interactions.
Want more? A recording of the discussion, more than two-dozen breakout sessions and keynote presentations is available for unlimited, on-demand purchase. See what you missed here.
SteveMustard is the president and CEO of National Automation, Inc., a company that supplies automation products and services to customers in water & wastewater, oil & gas, transport, electricity and manufacturing. He is also the president-elect of the International Society of Automation (ISA), a non-profit professional association that provides standards-based technical training, publications, events, and resources for engineers, technicians, and management working in industrial automation.
In December, news broke of a major compromise of U.S. federal government and Fortune 500 companies who used software from a network-management software vendor called SolarWinds. The incident arose from a SolarWinds software update that contained malicious code. Users who applied the update from March 2020 onward would have been exposed to the vulnerability, potentially allowing attackers to gain access inside their networks. It is estimated that 18,000 users applied the update. As of January 2021, the full extent of the breach remains unknown.
This incident should cause genuine concern to all SAMA members. In my earlier conversation with Harvey, we discussed the fact that safe and secure products and services are crucial to strategic account relationships. We also talked about how hackers will target the weakest link in the supply chain. Here is a very real example with very real consequences. SolarWinds is now involved in a massive recovery effort, both technically and with its credibility. However, they are unlikely to be the last major vendor to be the focal point of such an incident.
Vendors will learn from this incident and address any known gaps that they have, but the next incident will be different and will leverage previously unknown gaps. The most serious threat to any SAMA member is complacency. Cybersecurity management is a continuous process requiring constant vigilance and dedication. SAMA members should constantly review their exposure to cybersecurity risks, with a focus on answering these key questions:
• How well do we protect our systems, intellectual property and other sensitive information? How would we have been affected had the latest incident hit us?
• Do we have effective processes for reviewing and updating who has access to our systems and information as well as the methods for doing so?
• How secure is our supply chain? How confident are we that we don’t have weak links in our chain?
• How well prepared are we if a cybersecurity incident were to occur? Do we know what we would do and whom we would contact? Does our incident-response plan cover our entire supply chain?
• How secure are our strategic accounts? Do we provide them with the necessary guidance, and are we helping them manage their cybersecurity risks?
One closing thought: The focus ought not to be on SolarWinds themselves but rather on the fact that attackers will look to exploit the weakest link in the supply chain.
Harvey Dunham: It’s my pleasure to be speaking with an expert from the International Society for Automation, Steve Mustard, who’s an expert in cybersecurity. Steve, welcome. It’s great to be speaking with you, and I look forward to the conversation we’re about to have.
Steve Mustard: Thank you, Harvey. I’m very happy to be here. I’m very happy to discuss cybersecurity with your members.
HD: And Steve, would you just give a brief introduction about yourself so they know a little bit about your background and how you earned your stripes in the cybersecurity world?
SM: Sure. I’ve worked in industrial automation and real-time embedded systems for 30 years, space defense and then energy and utility companies. In the last 12, 15 years, cybersecurity has become a big issue in industrial control systems. And as a result of my background, I’ve gotten heavily involved in that side of life, and I’ve spent a lot of my time these days consulting with asset owners about how to improve their cybersecurity posture in their mission-critical facilities.
Digitalization is both a source of disruption and an enormous opportunity. We argue for the latter. Never has there been a better opening for SAM programs and strategic account managers to take on a bigger role in securing the future of their organizations.
The implications of digitalization are forcing SAM programs — and the SAMs who drive them — to redefine themselves on multiple dimensions. While many traditional SAM traits will remain, the overarching trajectory will see SAMs having to become even more strategic than they are currently.
The practical manifestations of becoming more strategic will take three distinct shapes:
SAMs will take alignment to the next level by becoming drivers of strategic development cross-functionally and inter-organizationally.
Strategic account management will be liberated from the shackles of the seller-buyer dynamic by transforming from account management to ecosystem or stakeholder management.
SAMs will develop new processes and skill sets that will make the future one of leadership, rather than of management.
The role and responsibility of the SAM are transforming from advanced, consultative, insight-based selling focusing on one customer relationship towards orchestration of mutual value creation in a larger ecosystem of organizations. To simplify, one could argue that strategic account management is becoming strategic ecosystem leadership — no longer SAM but SEL.
The elevated SAM’s new and important roles are summarized in diagram below.
From aligning to driving: strategizing
Traditionally, SAM has been viewed as a set of management practices that aim at inter- and intra-organizational alignment: Inter-organizational alignment to jointly (with the customer) develop a value proposition and a process for the delivery of the value proposition…and intra-organizational alignment to create a collaborative, flexible and committed customer-centric culture that enables value creation for the customer and value capture for the firm.
The goal of aligning functions and processes between selling and buying organizations is not disappearing, but the new digital reality means that it is no longer enough. Increasingly, SAMs will need to assume the role of “change champions” who drive change and strategy development.
Being a change champion can take several forms, but key to them all is to not fall into a trap of becoming an administrative and commercial coordinator – someone who spends her/his time on aligning, without having a development trajectory aiming for new value creation. A change champion may drive development in three different ways:
Driving strategy for the selling firm. The strategic account manager needs to be involved not only in executing strategy but also, increasingly, in driving strategic initiatives within his or her own organization. The SAM program should be a vehicle for top management to identify new business and renewal opportunities and to shape the firm’s strategy by providing deep understanding of strategic customers and the overall market.
Driving strategy for the customer. The strategic account manager needs to focus on helping the customer create value in new ways. Sometimes this takes the form of challenging various influencers in the customer organization and suggesting modifications to its present ways of running things. This implies new types of processes and skill sets, where strategic account managers are tasked with becoming “value innovators and transformation agents” by helping customer organizations to strategize.
Driving market development. As markets become more dynamic and malleable, and strategies are less market-driven and more market-driving, the SAM becomes a key market shaper and can, for instance, push the market boundaries by finding customers who are early innovators and then engaging them as lead customers in a process of collective learning. Additionally, facilitating dialogue with customers and other actors in the ecosystem can challenge dominating assumptions about the market, reexamine existing market boundaries and expand market boundaries.
Becoming a driver of strategic development has two consequences. First, it will heighten the importance of value quantification and verification. To drive customers’ strategy or how the market develops, the SAM will need to tap into available data to show the potential for reconfiguring resources in the ecosystem to enable value creation relevant to influencers inside the ecosystem. Using data analytics will be the basis for credibility creation – a necessary foundation on which to build the case for change.
Second, SAM practices will need to be modified to better fit with the idea of driving change. Account planning will need to look beyond the buyer-seller dynamic to become increasingly collaborative. Value propositions will need to be made based on deep insight into influencer and stakeholder situations, and new tools will need to be applied to engage influencers and stakeholders in a collaborative process of co-creation. Digitalization provides tools and techniques for these modifications.
From account to ecosystem: orchestrating
A dramatic development that supports the elevation of SAM is the expansion of the “unit of analysis” – moving focus from the seller-buyer dynamic of strategic accounts to the larger ecosystem. If global accounts that involve hundreds of individuals are viewed as complex, then widening the perspective to include entire ecosystems makes them exponentially more so.
Increasingly, companies face situations where no single firm possesses all the resources or capabilities required to deliver the value required by strategic accounts. As solutions become more complex and components of the solutions become more digital, they are increasingly created and delivered by a “competency system,” or ecosystem — a combination of collaborating industry players.
The consequence is that strategic account management needs to be emancipated from the shackles of the seller-buyer paradigm so that it can focus on generating a better understanding of how resources in the broader ecosystem can be reconfigured to increase resource density for the strategic account. To put it succinctly: SAMs need to become industry players, ecosystem architects and ecosystem orchestrators – all roles that require a new set of skills and new tools.
In an ecosystems view, success is less dependent on the resources that a firm controls than on the resources to which the firm can connect. This flips traditional strategic account management on its head. Rather than start with what the firm controls and look for ways to leverage it, tomorrow’s SAMs will need to begin with the opportunity and then assemble the required resources in its wake. Key will be the ability to orchestrate actors and resources in the larger system to allow the firm to assemble and flexibly reconfigure resources so that value can be created for the entire ecosystem.
To seize opportunities that lie outside the grasp of any one firm, SAMs need to assemble partners, create alliances and enter into joint development efforts in which influencers and stakeholders are guided towards a common vision.
From management to leadership: facilitating
The key to being successful in driving strategic development in a customer organization or in an ecosystem of stakeholders is a simple realization: Change will never happen unless you can engage other individuals in the process. It requires leadership that facilitates others – customers, suppliers, other business partners and sometimes even regulators – to engage in a common change journey.
Moving from a firm-centric view to an ecosystems view implies an acceptance of complexity and uncertainty – and a corresponding loss of control. A successful strategic account manager encourages novelty and innovation not by directing but by allowing; not by stabilizing but by disrupting stifling patterns. In fact, in order to become a driver of change, one must decouple leadership from the individual and distinguish between “leadership”and “leaders.” SAM leadership should be seen as an emergent, interactive and distributed process of learning, influenced and enabled by the SAM process and strategic account managers.
Hence, we are not arguing that strategic account managers need to become better leaders, but rather that they will need to engage in processes of leadership that are characterized by facilitation and rotating leadership:
From self-centric to allocentric innovation. Orchestration of resources and activities in the ecosystem will require strategic account managers to switch from a self-centric, firm-based view to an allocentric (“other-centered”) view in which value is created for the whole market system by integrating resources from an ecosystem of organizations. To seize opportunities outside the firm’s grasp, the SAM will have to facilitate processes that help to assemble partners, create alliances and enter into joint development efforts.
Learn from jazz (i.e., rotating leadership): Part of orchestration relates to improvisation and allowing others to play their solos. Even if a jazz band has a leader, his/her roles are very different from the traditional orchestral conductor. The latter stands alone, high on the podium, and controls the performance with his baton, based on a score. By contrast, in jazz the leader is one of the players. And leadership rotates during solos, as everybody else builds a platform enabling the soloist to shine. Research has shown that rotating leadership — where organizations take turns leading the inter-organizational collaboration in distinct phases — and consensus leadership — where organizations work together, agree to common objectives and follow shared decision making — are associated with higher innovation outcomes than collaborations dominated by a single actor.
Strategic account management traditionally has been a set of primarily managerial practices: to make account-specific plans, execute them and follow up. Simultaneously, the more advanced programs have engaged in activities geared towards impact without authority, acknowledging that SAM programs on the one hand have an element of conflict management in them, but also that strategic account managers can exercise considerable power if they play the game well.
The managerial part of SAM is not going to disappear, but the leadership part will need to be elevated. This does not mean that strategic account managers will need to become more “leaders” than they are today, but rather that the SAM process will need to be designed in such a way that it enables distributed leadership in a collaborative process. Digitalization provides tools for this. Cloud-based collaboration also can, at its best, enable work to be organized more in projects and less in functions, and can enable the formation of flatter organizations. This would facilitate more people to be engaged in leadership.
An exciting time
To reap the benefits of digitalization, we need to ensure that digitalization is not used to engage in more administrative work or building more elaborate account plans. The name of the game is increasingly about added value, co-created between many stakeholders in the ecosystem. And this co-creation puts demands on strategic account managers’ abilities to navigate inside their own company as well as inside the customer’s and other stakeholders’ organizations.
For those who are ready for this new role, these are exciting times! Want to go deeper? Read the entire SAMA research report on which this post is based here.
Kaj Storbacka is professor of Markets and Strategy at the University of Auckland Business School’s Graduate School of Management. Elisabeth Cornell recently retired after nearly two decades at SAMA, most recently as senior knowledge content developer.