Account Management Gold

BALANCED SCORECARD

Peter Mahoney
BALANCED SCORECARD - Account Management Gold

KPI, Key Point Indicator business target and goal measurement concept by multiple arrow pointing to colorful alphabet building the word KPI at the center.

The balanced scorecard is a performance management tool which will enable you to assess how well the account management process is working. It provides for the ‘measurement’ of several key areas, most of which are not financial. This is particularly important as company boards invariably make decisions based on financial information alone unless a balanced scorecard has been adopted.

So, the balanced scorecard enables you to be ‘on top of your game’ at all times; which is good for your client, your company, your colleagues and you personally!

This blog explains what the Balanced Scorecard is as well providing a simplified example of how it can be used. Management, finance, people, client & sales are the five categories which are maintained, scored and acted upon.

Each Category has a number of Key Performance Indicators (KPIs) which, for initial ease of use, are marked either ‘1’ for ‘Yes’ or ‘0’ for ‘No’. The overall category score can then be expressed as a %.

Then, the overall/combined % score can be determined for all categories.

However, you may wish to develop a more sophisticated method of scoring once you have become familiar with this key area of account management and make any required modifications in the light of your experience. In its current form, some of the answers will inevitably be subjective.

It should be noted that every Level 1 KPI is a crucial indicator and must be regarded as mandatory.

Balanced scorecards for individual client accounts should be reviewed and updated on a monthly basis.

A sample of KPI questions is given below.

Level 1 – Mandatory

A.   Management

    • Delays & Overruns managed to client’s satisfaction?
    • Account Manager’s performance & qualities reviewed?

Each KPI:  1 for Yes, 0 for No

B.   Financial

    • Profit margin (%) increasing?
    • No debts older than 60 days?

C.   People

    • All colleagues’ personal objectives geared to ASPIRE’s ‘Golden Rules’?
    • Sickness less than 5%?

D.  Client

    • Issues/complaints resolved satisfactorily?
    • Relationship good?

E.    Sales

    • Sales opportunity pipeline rigorously qualified & improving?
    • Lost orders reviewed?

Total KPI Score must be 8 out of 8 otherwise category/account requires immediate attention.

Each ‘No’ requires the Account Manager to provide an explanatory paragraph with details of the next action, who & when.

Level 2 – Highly Recommended

All 5 Level 2 KPIs are considered highly desirable but not mandatory.

However, if monitored, there is no doubt that your client, company, colleagues and you (the account manager?) will benefit significantly.

AA. Management

    • Value Added provided? (freebies, technology updates, talks/presentations/seminars/training/etc)

BB.  Financial

    • Next month’s revenue forecast higher than last month’s ‘actual’ revenue?

CC.  People

    • Each colleague working on client account scores ‘positive’ for team spirit/morale/teamwork, extra miles, client knowledge, supplier knowledge?

DD. Client

    • Client satisfaction survey in last 12 months?

EE.  Sales

    • Value of new business/orders year-to-date greater than same time last year?

The initial scoring of 1 for Yes or 0 for No for each KPI (as done for Level 1) will quickly reveal whether further action is required in any of these 5 additional key areas of account management. Overall absolute and percentage scores can then be calculated for submission to senior management if required.

Over time, graphs should be used to monitor performance trends.        

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Best Practice Quote 9 of 13:

“the balanced scorecard is the only tool which enables you to establish exactly where you are and what needs to change in order to stay on course”

NEXT BLOG: Risk Management

The complete set of account management components can be found here, all of which are explicitly focused on improving supplier performance and blocking the competition.

As an introduction to these components, I’m writing a series of blogs which I hope will be of value and appropriate for the type & size of your client, prospect and target organisations:

As these blogs are geared to anyone engaged in developing new business with clients &/or prospects, and for ease of context, I’ll regard all readers as account managers because everyone has the same endgame, no offence!

I really hope you, your colleagues & business associates find value in these blogs; please let me know either way. Please also get in touch if you think there might be potential for our businesses to collaborate.

ASPIRE’s MISSION 

– to enable Account Mangers & Suppliers to develop long-term revenue streams while minimising risk in all that they do

– to increase profit margins, expand people networks, develop trust, enhance market standing & boost morale/pride

 

ASPIRE, committed to providing practical best practice to enable you, your team, your company and your clients to exceed business expectations year-on-year

Richard Wright, Managing Director, ASPIRE Account Management™, ©Copyright 2024, All Rights Reserved

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