Key Account Management for Law Firms: To Do or Not To Do?
Domain: Business Development, Business of Law
Strategic account management, also known as key account management (KAM), is a discipline that focuses on building strong and mutually beneficial relationships with a firm's most important clients. Those relationships are important because, in many firms, 20 percent of clients account for 80 percent of revenue. The loss of just one major client relationship could be damaging to a firm's reputation and bottom line. According to McKinsey, well executed KAM programs with diverse, multidisciplinary client teams can increase revenue from large client relationships by 5-10%, while maintaining profit margins. However, Accenture points out that not all key customers are profitable noting that more than half of the companies it surveyed in a 2011 Insight study recognized that they needed improvement in selecting key accounts.
The primary objective for key account managers is to maximize profitability from each major account by entrenching their firm as the "go-to" business advisors. To achieve this, they develop and implement a strategic plan that sets out business objectives and identifies the services that addresses client needs and will generate sales. Managers also use their knowledge of each major account to identify opportunities to further service client demand, and open additional revenue streams.
Building the highest levels of customer satisfaction is also an important objective for key account managers. They must ensure customers are satisfied with every aspect of the service they receive. Key account managers aim to build strong relationships with a broad array of client contacts who make or influence purchasing decisions with the objective to build strategic relationships that make it difficult for competitors to break into the account.
- Identify what are key accounts and what constitutes as one
- Discuss how to know whether your firm needs a key account program
- Discuss how to identify key accounts
- Examine the framework and best practices for key account management
- Review the benefits of key account management
Justin Edmondson, Director of Client Relations, Covington & Burling
Erin Lawler, Head of M&BD, Americas, Hogan Lovells US LLP
Cheri Devlin, Sales Director, Business Applications, Microsoft
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