Step 1: Determine the Entry Point

,

You begin your account penetration that leverages creating demand by identifying the right point of entry, that is, which business unit or functional area you should focus on within an account. It’s about knowing what doors to knock on as your initial penetration point. To sort this out, you take four factors into consideration:

1. Political connectivity
2. Business significance
3. Business impact
4. Supplier return

These factors work in concert to help you quickly and objectively determine where to start the process of displacing a competitor from a potentially important account. Let’s look at each one in detail.

1. Political Connectivity: Is there a Fox in a particular business unit, division, or department who has a relationship with a higher-level Fox? This is important because when you determine how to provide a specific business unit with Unexpected Value by moving up the Sales Value Chain, you will want to move upstream to the higher-level Fox with the support of the Situational Fox with whom you are working. This is why it’s critical to engage in intel gathering to discover this kind of Fox-to-Fox connectivity.
2. Business Significance: Which business unit or functional area is the most financially or strategically crucial to the company? Although the obvious choice is one that produces the most revenue or profit, sometimes it is one that has the potential to directly or indirectly drive revenue and/or margin in the future. In that case, it would be considered strategic. As with the first factor, you want to lean heavily on your intel gathering to make as accurate an assessment as possible. This becomes significant because the upstreaming that we mentioned earlier may not work if you focus on an ancillary—and therefore, not very important—part of the customer’s business.
3. Business Impact: In which business unit or functional area can the solution you provide make a significant impact? This is probably the most challenging factor to assess because you may not have sufficient information to determine how you will move up the Sales Value Chain within any specific functional area. To address this, consider the intel you have gathered and be ready to apply it to multiple business units, divisions, or departments if necessary. There is simply no easy way to avoid doing your homework on this one. Determining business impact becomes an important step even if you are working with a significant business unit, as making an insignificant contribution will likely prevent you from moving upstream later.
4. Supplier Return: Which business unit or functional area will provide your company with an acceptable return? Keep in mind that some of the account penetration cost can be amortized over the business generated during the next few years if your penetration effort is successful. At the same time, you certainly want your first deal to be profitable; that is why it is so important to move up the Sales Value Chain to protect margins. In addition, providing Unexpected Value will also play a key role in your ability to upstream to the higher-level Fox.

Now, let’s look at each of these steps through the lens of an example. Suppose that there is a major bank in your territory that you have not been able to penetrate. Your immediate task objective is to determine the right entry point, so you begin by launching your intel-gathering effort. It becomes clear before long that one of three business units could be your target: wholesale banking, community banking, or wealth management.

Political Connectivity

You then focus on the first entry point factor, political connectivity. Heading up each of the business units is a Senior Vice President (SVP) who reports to the bank’s Chief Executive Officer (CEO). As it turns out, the SVP of Wholesale is not in the Enterprise Power Base. Although he’s very senior and well respected, he is also close to retirement. The head of community banking, however, is powerful and definitely part of the Enterprise Power Base, whose Fox is the CEO. The problem there is that you have found out that he is an Opponent when it comes to your company—bad news, indeed! At the same time, your intel suggests that the SVP of Wealth Management may be accessible, but her political strength is questionable. Although it is not what you would like it to be, the best Fox-to-Fox connectivity seems to reside within community banking.

Business Significance

Fortunately, the second factor in determining where to focus—business significance—is more straightforward. Wholesale banking, which centers on other banks and large corporations, is down in both revenue and margin, whereas wealth management has done well, largely due to its transaction fee business model. But the growth play is clearly in community banking, particularly from a margin point of view. As such, you decide that the business significance thumbs up needs to go to community banking.

Business Impact

Business impact will always be business unit specific, so you are now ready to make an assessment of impact potential. Appropriately, your intel gathering focuses on community banking in order to build a much deeper understanding of that business.

After conducting the detailed research, making a few calls, and exercising one or two social network connections, you’re getting a clearer picture of how to provide Unexpected Value. Customer checks are processed manually at the branch level. You know from experience that if the bank were to employ check imaging technology, they could potentially reduce labor by probably one full-time employee (FTE) per branch. After doing the math for the total number of branches, it appears that your solution could save the bank the equivalent of their entire telecommunications budget—and that doesn’t even take into account the positive effect on customer satisfaction and retention. Equally exciting is the option of freeing up customer service personnel to focus on selling new services to existing clients, as this is becoming a priority in the community banking unit. But perhaps best of all is the fact that the bank has no idea that all this is possible, which means that this is your opportunity to move well up the Sales Value Chain to provide Unexpected Value. Although the cost savings or refocusing of personnel would not be a home run, it would certainly get you to second base—another vote for community banking as your entry point.

Supplier Return

The last step is to address supplier return. You have experience with this type of solution and know that little to no discounting is required for the deal to be profitable. Certainly, you’ll have to provide a proof of concept exercise during which you will set up a test installation within a few branches to demonstrate the approach and assess the business impact. But if history repeats itself, that should go well. As such, another check mark goes next to community banking to be your target.

..................Content has been hidden....................

You can't read the all page of ebook, please click here login for view all page.
Reset
18.226.159.33