One Change That Can Make Or Break Business Partnerships
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We often hear about how ‘relationships’ make or break the long-term partnership with a client, and it’s true that the connection that you keep with the client can play a vital part in determining whether you will keep getting repeat orders or not from your client.
But our studies have shown that there is one main component in a supplier/client relationship that can go a long way in developing future sales and encouraging that close relationship that can make or break the contact.
Many clients report that the main reason they leave a supplier of products or services is the tail-off of support or engagement after the sale has been completed. Typically, there is just one point of contact between the supplier and the buyer’s company, and if that relationship is not maintained efficiently enough, or one of the parties leaves or moves to another position, the relationship between the two companies quickly wanes.
This traditional bow-tie method of dealings between companies is typical because it offers a high degree of control and allows for consistency of approach in the dealings between the two companies.
However, the account management challenges caused by this one-point-of-contact approach can be far-ranging, They include:
- The lack of depth in contacts within the buying company
- Low understanding of the overall company business
- Poor penetration of product knowledge within the client company
- Top-heavy dependence on just two persons
- More susceptible to competitive offerings
This ‘bow-tie’ approach was developed by, among others, Peter Cheverton in his book ‘Global Account Management’ and it is still the favoured choice among many sales organisations, even though it proves itself to be the main cause of disharmony between supplier and client in today’s demanding environment.
Cheverton suggests a solution is a matrix-functional approach, known as the ‘diamond relationship’.
This increases the value that the supplier offers the client in many ways, including:
- The ability to educate the client in areas the supplier can offer help, assistance, back-up and diversity
- Better resource management, as different team members can interact with more people within the client’s organisation
- Increasing the expertise that is shared between the two companies
- Developing the partnership of the two companies, as the reliance is less on one person, expanding the contact base
- Building trust, as the dependence is not just on one person but many within both companies
- Reducing the risk of loss of account synergy if one of the contacts moves on or leaves
The overall benefits to both companies are manyfold.
- Both companies understand each other better
- The purpose of the relationship goes beyond just transactional sales
- Long-term plans can be built up between the companies
- Strategic directions help both companies invest in key areas for future development
- The accounts for both companies are aligned and relationships maintained
- Value can be added at every contact point within the companies
This strategy for key account management will assist in all elements of contact between the two companies, and opens up opportunities that wouldn’t exist in traditional sales models. By incorporating the diamond approach, companies see opportunities expand, information becomes easier to obtain and partnerships develop at various levels of both organisations that wouldn’t have occurred using the bow-tie model.
MTD Sales Training
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