Long live KAM culture
Charlotte Green says KAM processes are dead. What matters is creating a demand.
Love them or hate them, how do you consort with processes?
• Are they your essential kit – you feel naked without an 8-step
template, pithy TLAs and a steering committee?
• Do they make you feel tied up in knots, your creative and entrepreneurial instincts smothered?
In our respective firms we interact with a veritable panoply of processes every day, such as:
• New business intake
• Financial management
• Performance management
Whilst we hone and improve these processes, no one questions their right to exist. When it comes to Key Account Management (KAM) processes however, these are regularly ignored, subverted or treated with a certain distain. Why? Because the above processes are seen as core to the firm’s survival whereas KAM processes are usually not.
And that’s what I want to unpack. KAM programmes are enthusiastically started with good intentions. But too often, they dwindle or lose sight of their original objectives and all we are left with is a rather detached set of KAM processes, like maintaining lengthy and unambitious client plans, regular internal team meetings which turn into talking shops and unfocused relationship meetings with the client.
Unfortunately, one of the underlying problems with KAM programmes is that it can be hard to prove their success – would new business wins and deeper client relationships have happened regardless? What’s more, KAM programmes are often set up because of a firm’s success and can therefore feel like the imposition of process or a management edict where none is (supposedly) needed. This can particularly be the case in small to medium-sized firms where partners retain a strong sense of ownership of the business and ‘their’ clients. Lastly, KAM is competing for air time – there’s work to be done, targets to be met and other demands of corporate life – it is easy to find something else more urgent to do than to focus on longer-term objectives.
Consequently, KAM programmes often start with an image problem and end up as a plea to be a good corporate citizen than simply what we do around here. And management or some beleaguered business development manager has to constantly bang the drum to keep things running.
But a firm wants to keep its most important clients loyal, it wants to grow promising relationships and future-proof all of these from partner moves. Equally the discipline which a KAM programme and its processes offer, such as planning and client listening, can provide a useful framework to guide team thinking – especially as a firm grows into a larger business.
So, can KAM processes be fully and deeply ingrained in a professional services firm in a way which is truly additive to that firm and its clients? Or to put it differently, can KAM become a firm’s core process, like tendering or financial management? Yes it can. But KAM processes can only be truly successful if they serve a demand. So, let’s forget process per se and simply work towards creating that demand: a KAM culture.
I’ve outlined a tiered approach, each tier more challenging but more likely to foster an environment and encourage behaviours in which the active and disciplined development of key client relationships can thrive.
Level 1: Integration with a firm’s core processes
Some integration between core processes and a KAM programme is both essential and relatively straight-forward, for example:
• New business intake and conflicts – prioritisation for key clients
• Financial management – dedicated time codes, financial analysis and ROI reporting
• Access to resources – dedicated BD budget, special service and value added offerings, eg. priority access to secondments
Clearly we can get only so far with this level of integration but it shows a firm putting (some of) its money where its mouth is.
Level 2: A client-centric culture
Regardless of which clients are in your KAM programme, a client-centric culture should be all-encompassing. It can cover everything, from service design and delivery, to recruitment, and to the way a firm’s business support teams operate. How you define client-centricity largely depends on the firm itself: structure, practices, leadership, culture and, of course, the resources available to make it happen. But essentially you’re dialling up the client voice to shape how the firm thinks and acts, and ensuring that your key clients are best placed to benefit from the resulting outcomes.
Underpinning all of this, the firm’s direction should be shaped by a clear and fully-understood business strategy, which helps identify the client relationships for your key client programme.
And of course KAM – or client-centric – behaviours must be actively sponsored, acted out and demanded right across the most senior levels of the firm, recognising client relationships as a long-term commitment.
If a firm got just some of this right, KAM processes would be more likely to be seen as core because the firm would be rooting key client management into organisational thinking and behaviour.
Level 3: Performance management, reward and incentivisation
As I say to bemused/bored colleagues time and again, how partners are remunerated explains a lot. And aligning client-centric behaviour and success in key client relationships with fee earner reward is a firm foundation to developing a KAM culture.
This might involve partners and other fee earners given transparent credit for client collaboration, key client objectives, targeted training and development from trainees upwards, and actual time (yes!) for key client relationship management. Client feedback can also contribute to appraisals and team structure – and quantitative client satisfaction data can be used to benchmark performance over time – increasing the focus on loyalty and advocacy over a more short-term focus on sales.
Much of this would be a step too far for many firms but that’s still not enough. Despite toiling under a single remuneration structure, we still see partners behaving differently when it comes to key client development, even when those structures have some reward for successes in KAM.
Level 4: Who are your partners?
Firms spend years nurturing associates, directors, consultants, call them what you will, to select the cream of the crop as partners. So who are your partners? Technicians at the top of their game or client whisperers? Or both? What impact do they have on your client relationships? Would they be able to seize a new business opportunity if it lay down in front of them and said “take me, I’m yours”?
Your partners have spent their professional life competing against their colleagues, hitting personal targets and forging their reputation. It’s hardly surprising then that one of their key needs is independence and a sense of control – including over their clients. A KAM programme can threaten that independence by requiring collaboration and asking partners to conceptually hand over their clients to the firm.
And in a world of lateral hires, hinging on the promise of transportable business, why on earth would a partner want to share?
I’m painting a rather extreme picture of a partner but the point is, have you considered whether you have enough partners with the right mind- and skill-set to fulfil the promise of your KAM programme?
Despite a procurement and value-driven environment, clients still buy advisers they get on with – back at the ranch, your most successful partners could be un-collaborative lone wolves. So, when you’re considering key account management, give yourself a reality check around your relationship partners, your ‘raw material’. And see if it makes sense to include those who play nicely – you’re looking to reward and ingrain certain behaviours. Or do you need to reframe the objectives of your KAM programme, evolving them as you develop the partnership skill-base?
I realise that embedding all of the above successfully would take most firms a number of years, assuming they even made it on the Board or Executive Committee’s agenda in the first place. But I’ll put money on stating that the firm which puts a combination of its clients’ welfare and partner behaviour at the heart of its business and remuneration strategy will reap the rewards.
And if it does?
• The extremes of a hard-sell or no-sell environment replaced by a longer-term, investment-driven approach to develop priority client relationships in teams.
• Client service delivery designed with careful scoping, pricing and resourcing to support the client’s drivers as well as firm profitability.
• Client and BD considerations at the heart of associate and partner recruitment and development, hand in hand with technical and commercial skills.
Which should make for happier, loyal clients and, I daresay, a more satisfying – if demanding – environment to work in. And the processes which often are the face of a KAM programme in a professional services firm would serve the demands of key client relationships rather than the other way around.
Charlotte Green is Head of Client Services at Nabarro LLP.