how strategic account management helped a "small" swiss company grow globally

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When I joined MCI – the world’s leading provider of strategic engagement and activation solutions and a key driver of innovation in the meetings, events, association and congress industries – in 2004, it started inauspiciously with an irate meeting with the customer I’d been brought in to manage…who happened to be one of the largest I.T. companies on the planet.

As part of getting to know the client organization and introducing myself, I had decided to meet with the most senior contact we had. It was not the meet-ing I had imagined, as the client started to give me hell for perceived service breakdowns, delivery issues, pricing pains…you name it. If there was a way to aggravate a customer, we’d apparently been doing it. This obviously wasn’t how I wanted to start my new job, but I tried to focus on the meeting’s silver lining: namely, the client told me – in very concrete terms – how MCI could change to become a better supplier. Specifically, he wanted a single point of contact and accountability at MCI, a consistent pricing framework, and increased coor-dination across geographies and business units. They weren’t looking for “one price” – it was more about having a standardized offer, a standardized customer experience and about finding holistic efficiencies rather than ad hoc solutions.

Our first thought was, “Oh, no. We’re failing.” But our second thought was the one that stuck: “If this customer’s asking for it, then others must be, too.”

At the time, MCI was a small niche player in what was (and, to a large degree, still is) a very fragmented marketplace. Headquartered in Geneva, Switzerland, we had about 270 employees working out of just eight offices in western Europe. But our founder and president held an audacious vision for his company: that 50 percent of our revenues come from customers utilizing us in multiple locations.

By Dev SharmaVice President, Strategic Account Management, and Member of the Business Board at MCI

and Nicolas ZimmermanEditor, Velocity

HOW SAM HELPED A “SMALL” SWISS COMPANY GROW GLOBALLY

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In our industry, such a goal seemed unthinkable. But organizations take on the personality traits of their leaders, and this bold target gave us something concrete to strive toward.

It is our opinion and vision that in our business there are two states of existence and prosperity: Either you’re a big global player capturing worldwide business, or you’re a highly specialized niche player. Longer-term sustainabil-ity will be a challenge if you’re stuck in

the middle. Our CEO aspired to be the former (i.e., a global player), and thanks to my inauspicious first client meet-ing, we had the roadmap to get there. Our strategy had two pillars: to grow via mergers & acquisitions in markets we were not yet present and to grow organically. This is where SAM would play an important part. While we had a nice footprint in western Europe, with annual sales turnover of €84 million, we had minimal regional coordination and minimal border-spanning relation-ship planning.

So while my unpleasant opening round with our largest customer was a wake-up call, it also served as an invita-tion to change. If one client was asking for more coordination across geogra-phies, then we figured others probably wanted this too.

We soon realized we’d come to a crossroads as a company and that our opportunity to grow globally was ours to seize.

A Path ForwardIt was around this time that we

started hearing whispers of SAM and GAM, but the trouble is they were just that: whispers. There was no established definition of what GAM even was – not just within MCI but in our industry as a whole. Sure, manufacturing behemoths like Siemens, SKF and Schneider Electric may have discovered the magic formula for getting the most out of their most important custom-

ers, but we were small and had fewer resources by comparison. And while our industry had a strong legacy of client-relationship management, it lacked the strategic part of the equation. Roles, responsibilities, authority and account-ability…these were all issues we’d have to contend with if we decided to embark on the SAM journey.

As I write this in 2014, MCI has more than 1,600 employees spread across offices in 30 countries, doing business

on six continents and with annual sales turnover of €380 million. So how did we get there in just 10 years? This is the story of that journey.

We knew from the start that if our customers were asking us for more regional coordination, they’d be asking it of our competition as well. Although we felt like we had a small head start, we knew that if we didn’t adapt quickly, we’d squander whatever advantage we might have had. It was around this time that someone recommended I look into a small nonprofit organization dedi-cated to evangelizing on the ideas I’d been struggling with: SAMA.

I went to my first Annual Conference in 2008, and it was a revelation. Here were hundreds of SAMs, SAM program leaders and executives talking about the same issues that had been keeping me up at night.

How do you achieve executive buy-in? Should you restructure your org chart to accommodate the SAM function or build an overlay onto your existing structure? How many accounts, and which ones?

These questions are at the heart of any person’s quest to implement a new SAM program. (And I’ll talk about how MCI tackled these issues shortly.) But I quickly realized that, while being at SAMA’s Annual Conference felt in many ways like being reunited with my community of peers, there was one thing that set me apart from my fellow conference-goers: MCI was tiny com-pared to virtually all the presenters and attendees I encountered at that first conference.

And that’s part of why I’ve endeav-ored to write this all down – to share some of what I’ve learned about start-ing a SAM/GAM program at a “small” company. While smaller companies tend to attract talent with an entrepre-neurial spirit (a good thing), the sur-vival instinct also runs strong. The gap between “making” and “breaking” can

When I came onboard, I

reported directly to [the

CEO] – and he gave me

the necessary leeway to

shape and form the strategic

direction we wanted to

take. This removed a lot of

the barriers I believe could

otherwise have slowed

down, or possibly even

spiked, the initiative.


be a sliver and, as a result, the push-pull between short- and long-term thinking can lean toward the former.

We had both the advantage and dis-advantage of being a “first mover” in our industry. Obviously, implementing a more strategic and customer-centric approach to our most important cus-tomers gave us a huge potential advan-tage over our competition. But it also meant we couldn’t look to others in our industry for relevant content, people, resources or benchmarking.

While clearly no two companies are the same, let me lay out what worked for MCI in the hopes that someone reading this can glean just one nugget that will help them make the right choices when instituting a SAM program.

Challenge: Securing executive buy-in

Solution: This one was easy because, unlike many out there, my CEO recog-nized from the get-go that SAM repre-sented the quickest ramp to the growth he coveted. When I came onboard, I reported directly to him – and he gave me the necessary leeway to shape and form the strategic direction we wanted to take. This removed a lot of the bar-riers I believe could otherwise have slowed down, or possibly even spiked, the initiative.

One quick note: It’s not enough (though it certainly helps!) to have the C-suite onboard. Other senior manag-ers need to buy into the transformation as well, and that’s why – a couple years into our program’s existence – we insti-tuted SAM leadership training for our company’s senior leaders so they under-stood intimately and endorsed the value – not to mention the economic ben-efits – of SAM. As SAM becomes more embedded in your company, senior

leaders will need to be more involved. You want them to be a help and not a hindrance.

Challenge: Finding the right SAM model

Solution: At first, we didn’t have the critical mass to set up a separate SAM program in which the accounts were solely managed by a global business unit. Instead, we opted for a coordina-tion model that was easier to implement by adding an extra layer of customer coordination, which required minimal disruption to the existing organization.

Our model has been constantly evolving over the years, and part of that evolution has required us to empower the SAMs with more authority to shape and manage the client relationship. Our company was in hyper-global-growth mode, and the “turf wars” were only getting more pronounced as the size and scope of the turf expanded.

Challenge: Balancing global vs. local priorities

Solution: Like in any SAM program, we occasionally had clients ask us to do something that was strategic for them but unprofitable for the MCI country unit in question. We mitigated this by building in advance a prescribed set of protocols: for arbitration, for account-ability and for escalation when needed.

Challenge: Measuring success

Solution: I remember being at my first SAMA conference, where a gentle-man from Shell recommended that, in the early phases of SAM, one measure the value of SAM with the same key performance indicators as the rest of the business. Anything else could lead to confusion and negatively affect the traction of a program. So following that

advice, the KPIs we used were top- and bottom-line results. It was only over time that we have added in share-of-wallet, customer-loyalty metrics and innovation.

Let me stop here and say that one of the biggest factors in setting ourselves up for success is that we had some early wins that helped cement the effective-ness of the SAM program in the minds of any doubters. In 2013, our SAM-managed accounts generated 35 percent more growth than non-SAM-managed accounts. This is a huge factor in build-ing credibility within your company.

Challenge: Industry-relevant SAM training

Solution: As a small company, we didn’t have the specialized expertise to train from within, so we knew we’d bring in an outside consultant. But from where? This was a tough one because our industry had basically no history of implementing SAM when we launched our program. Bringing in someone from fast-moving con-sumer goods or industrial automation wouldn’t make sense because the busi-ness models are so different. In the end, we brought in John Parke, CEO and founder of Leadership Synergies, whose background was with Marriott Hotels during a time they also were experiencing accelerated growth. Since he came from the hospitality field, it was a good match. He developed our entire SAM learning and development curriculum and has continued to be a trusted strategic advisor on our ongoing SAM journey.

Six months after our first internal SAM training seminar, we measured the participants’ progress. Of the inau-gural class of 38, close to two-thirds saw

Our first thought was, “Oh, no. We’re failing.” But our second thought was the one

that stuck: “If this customer’s asking for it, then others must be, too.”

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business improvements through imple-menting what they’d learned. I credit a substantial amount of the improvement to extensive needs assessments we con-ducted of each client early on. Rather than focusing on operational delivery – as we would have in the past – we looked at the clients’ business context, what was keeping them up at night and the like. This helped us start under-standing their metrics, which helped us align with them much more seamlessly. Clients loved this and rewarded us with more share of their business.

Challenge: Our customers are almost uniformly larger than us…often by orders of magnitude

Solution: At times it felt like David vs. Goliath in terms of living up to the service expectations one would nor-mally associate with “the big guys.” It’s just a fact that the bigger companies tend to work with bigger companies, so promising a strategic service model and

then delivering on it is a constant challenge.

But being a smaller company working with larger companies also has some advantages. Since MCI is to this day comparatively small, our senior people tend to be deeply involved in client discussions and are very much hands-on. When clients see someone at a VP level engaging with them in their own lan-guage – talking in terms of their metrics, their goals, their problems – it changes that client’s per-ception of us. Suddenly, they’re not looking at us as merely a transactional supplier but as someone much more strategic.

Challenge: Acquiring the right talent

Solution: Since there’s no SAM leg-acy in our industry, we were extremely restricted on where we could turn to look for talent. As a consequence, we’ve had to focus much more on talent development than on talent acquisition. Especially early on, there just wasn’t anyone to poach talent from. So we focused instead on finding people within the organization with the ability to think strategically about the client’s business challenges but also to deeply understand our own organizational capabilities. This was also a wonderful opportunity for our talent to progress their company careers.

Challenge: Driving change through the whole business

Solution: Once a program reaches a certain level of maturity, you want to embed SAM across the business. I felt we had two choices: let it happen by osmosis or give it a kick start. We chose

the latter, creating in 2011 a change-management engine we called the Project Management Office. (Coming from the world of event management, this came naturally.) Operating out-side the day-to-day business, the PMO drove change with tooling, resources, people, technology – you name it. So every time a component of our master plan was ready for rollout, the PMO drove the rollout and then immediately moved on to the next challenge. It is my opinion that this was one of the smartest decisions we made around the SAM program, as it led us to the eco-nomic results faster and with minimal disruptions to the daily business.

I’ve heard it said at SAMA confer-ences a hundred times, but I can’t stress it enough: SAM truly is an organi-zational transformation. Embedding it into your company’s daily opera-tions, optimizing it and making it best-in-class is a long and arduous journey. And it can’t happen in iso-lation. The company needs to move with it. Finance, Human Resources, Marketing, Training…each of these functions needs to be involved in the transformation to go from thinking in terms of silos to being customer-focused.

Before we’d built a critical mass within SAM, the program functioned like its own silo. But we tried to use our innate company culture – no-holds-barred, creative pioneers – to shape the culture and drive toward our CEO’s business vision.

Challenge: Selecting the right accounts

Solution: This isn’t revolution-ary, but it’s still important. When we started our account selection process, we broke accounts into market sectors: one around information communica-tion technology, one around healthcare and life sciences, and one around auto-motive. The pains and challenges of companies in these sectors are different


enough that it made sense to tailor our program around this trio of market verticals. Within those three verticals, we looked at our customers’ current financials, future financials and strate-gic mindset. We settled on 11.

Challenge: Deselecting accounts

Solution: Eight years after starting our program, we’ve grown from the original 11 to 19 strategic accounts with a far larger financial portfolio. (Of the original 11 accounts, only four con-tinue to be managed through the SAM program.) While some clients loved the more strategic and customized offering, and provided the engine of growth we longed for, others…not so much. Some customers, despite our best intentions, continued to see us as a transactional supplier – and eventually, we had to move resources to customers with a more strategic mindset.

The ResultsThe birth of SAM at MCI hasn’t

been without failures or setbacks, but the overall company results have been all we could have hoped for: double-digit growth every year for each of the past 10 years, expansion from a stronghold in western Europe to six continents, and a more than quintu-pling of our workforce. When I came aboard, our president and founder set an outrageous goal of having more than 50 percent of our revenue come from clients doing business with us in multiple geographies, 30 percent from clients loyal to us in one country, and 20 percent from purely transactional relationships. Today, the ratio is almost exactly that: 56/28/16.

Previously, we used only the most primitive metrics to measure client sat-isfaction: revenue, growth and share-of-wallet. Oftentimes, the first sign we knew something was wrong in the relationship was when someone left us. Fast forward to today, and we have an

enterprise-wide way of measuring client loyalty based on Net Promoter Score.

I knew we’d come a long way when our senior managers started getting really excited about SAM – about the numbers, as you’d expect, but also about the power of listening to the cus-tomer, about shaping the future and about driving innovation in collabora-tion with our clients.

Even though the last decade has seen the blossoming of a sophisticated, much more empowered Procurement role, and our competition surely hasn’t rested on its laurels, introducing SAM has enabled us to:

• maintain longer relationships, boost-ing the lifetime value of our client relationships, and thus contributing to our organic growth

• sometimes (but by no means always) bypass Procurement

• scale innovations and solutions to new (or other) customers

• entice customers to pay a price pre-mium for the value we provide

I could cite a dozen examples of how this success has played out in reality, but let me offer just one. Circa 2011, one of our clients, a major pharma-ceutical company, left us after a Procurement-driven pricing exercise. We’d been working with them for years, mainly via Procurement, and one day they called to let us know they’d found something cheaper.

Fast forward two years, and the main business unit came back to us and said (I’m paraphrasing here), “Look, work-ing with our current vendor isn’t work-ing out. It seemed great on paper, but they’re not delivering the value you did. Will you take us back?”

Well, very shortly afterward, Procurement got involved and said they’d be happy to do business with us again but that we’d have to match the price of the incumbent. Our SAM

told them, essentially, that they’d been doing business with our competitor at a price point they liked, but that it clearly wasn’t matching the standard that we could deliver. We’d be happy to have their business, but they’d have to pay a premium. After some back and forth, the senior client lead eventually told Procurement to get out of the way, and the client came back to us – and at a price point that took into account the additional value we brought to the table.

Final WordsWhile no two companies are the

same, and best practices at one com-pany may not work for another, I feel our SAM success story can be summed up in two dimensions: market and management. Number one: The mar-ket opportunity was there for us with clients signaling they wanted a SAM model, and their needs matched our desire to grow aggressively. Number two: Our company culture of collabo-ration and the entrepreneurial spirit found in our management teams cre-ated the perfect breeding ground for SAM.

The last piece of advice I can offer to any SAM leader (or leader-to-be) out there in a smaller company is this: When starting to build your SAM program, make sure you snap on your SAM model to the company’s existing DNA, culture and spirit. Success will come sooner than you think.

Dev Sharma is Vice President, Strategic Account Management, and a member of the Business Board of MCI. He is responsible for the transformation of the new global sales organization and driving organic growth through the management of global and strategic customer relationships and teams based in Europe, Asia-Pacific, the Americas and India, the Middle East and Africa. Find him at www.linkedin.com/in/devbsharma.