The organisation

Volvo Trucks are legendary. With a loyal following, a relentless focus on safety and the environment, Volvo enjoy a diverse client base across a broad range of transport sectors. Working in haulage, construction and logistics environments, clients depend on the reliability and economy of Volvo’s products and solutions.

The challenge

Despite producing state of the art trucks with a continual focus on innovation, Volvo’s largest accounts have become more procurement savvy, using a variety of means to extract maximum value from all suppliers. Placing orders of up to 100 trucks means there is good incentive for commercial buyers to scour the market and try to commoditise purchases.

In addition, Volvo has noticed ever greater demands for service and support from the largest companies, putting a strain on the key account team and creating resourcing headaches.

There was thus a need to analyse Volvo’s portfolio of ‘key’ accounts and decide where to focus valuable sales and support time and better manage relations with professional procurement managers.

The solution

Many clients face the same challenge: A long list of ‘key’ accounts, where there is no precise definition of what constitutes a key account. Therefore, the first step we took was to help categorise Volvo’s largest accounts so that a differentiated approach could be taken with each account.

Typically, this involved discussions and interviews with clients to establish the mutual desire to work on longer term value-added partnerships. Not all clients want the same things from a trade relationship: Some prefer for example to do their own truck maintenance, some prefer to outsource it. Some prefer Volvo to offer driving training, some prefer to manage that themselves. Finding the accounts where there was a logic and willingness on both sides enabled Volvo to invest energy in the right places.

Our solution involved workshops to categorise accounts and also start developing appropriate plans for the accounts. It also involved training on procurement approaches, negotiation and strategic thinking.

By the end of the programme, which ran over 8 months, the KAM team had a clearly defined portfolio of accounts, with a differentiated strategy for each account and the planning process was well underway. In addition, the account team were more in tune with the actions and motives of professional procurement, enabling them to be better business partners and more able to decode the signals they received.

Next Steps

Key account portfolios are dynamic and as new information comes in, the team will adjust the portfolio accordingly. Also, key account plans are often long term and the team is working on developing strong, mutually beneficial relationships with clients to deliver significant value to both sides.

One of the extra benefits of good key account management strategy is the potential it offers for innovation: As custom solutions are built up for specific clients, these can be diffused throughout the company’s account base.