Develop And Strengthen Strategic Accounts

Because software sales often are big-ticket items, few sales activities are more important than acquiring and maintaining strategic accounts. That being said, few software sales reps know how to identify strategic accounts, much less how to handle them.

In general terms, a strategic account is any account that if lost would significantly affect your firm’s business. In the software business specifically, strategic accounts come in three basic flavors.

1. Credibility Builder. Having this account on your customer list is necessary to maintain your firm’s credibility in the marketplace. For example: A small CRM vendor’s only large customer, which happens to be a multinational telecommunications firm.

2. Cash Cow. This is an account that is responsible for so much revenue that the loss of that revenue would significantly affect your firm’s finances. For example: An ERP customer whose yearly software subscription fees generate $10 million for a software vendor with $100 million in yearly revenues.

3. Growth Vehicle. This is an account that might not be responsible for much revenue today but whose future business is crucial to your firm’s future plans. For example: A startup that’s poised for major growth whose product will create demand for your software.

The key to building a strategic relationship is to make certain that the success of both firms is intimately tied to the health of the relationship. The account must view the relationship as critical to its ongoing, long-term success. This probably means that your firm will need to be intimately involved in the development of business plans and organizational strategy within the account. Second, your firm must view the relationship as critical to its ongoing, long-term success. Without this buy-in you’ll have trouble marshalling the resources of your firm needed to keep the account happy.

Here is the basic formula for acquiring and developing strategic accounts.

1. Build a profile. Define the kinds of accounts that might be strategic. For example, a startup company that’s selling innovative technology but lacks market credibility might seek a strategic account that has an easily recognizable brand name.

2. Identify candidate accounts. Look for accounts or potential accounts that meet the profile. Pay particular attention to accounts to which your firm can add unique value by helping the account achieve a goal, avoid a problem or fulfill a need.

3. Set goals and limits. For each candidate account, set specific revenue goals and timelines for achieving them. In addition, set limits on the amount of financial and human resources your firm is willing to expend to develop and maintain the account, lest spending spiral out of control.

4. Monitor progress. Every group that’s needed to support strategic accounts should be constantly informed about the measurable success (or failure) of the strategic account effort.

The above is adapted from a conversation with Sam Reese, CEO of Miller Heiman, a global sales training organization.