Matti Vänskä

Key Account Management Process for ABB

Large Motors and Generators

Helsinki Metropolia University of Applied Sciences

Master’s Degree
Industrial Management
Master’s Thesis
3 May 2017
 Preface

I would like to thank ABB for the support for professional growth and the opportunity to
do this thesis in the organization. Especially I would like to thank the colleagues in the
ABB Large Motors and Generators who have made this thesis possible and who have
supported my aspiration towards graduation. Thank you Ville, Esa, Jenni, Jaana, Anna,
Tuomas, Arto, Kimmo and Mikko.

My special thanks go to the fantastic and highly professional Master’s in Industrial Man-
agement instructor team in the Helsinki Metropolia University of Applied Sciences. Thank
you, Dr Thomas Rohweder for the tremendous support and help with my professional
growth and your belief in this thesis. Thank you Sonja Holappa for your encouraging and
motivating work that you have done to enable this thesis to become true. Thank you
Zinaida Grabovskaia for being always there when needed, and for the constructive feed-
back that has helped me in my journey. Thank you all my fellow students for this unfor-
gettable and rewarding professional development journey.

Finally, thank you to my loving family and friends for the support and please forgive me
for any trouble that this hard work and lack of free time has caused. Now it is time for
celebration.

Matti Vänskä
Helsinki
April 24, 2017
 Abstract

Author Matti Vänskä

Title Key Account Management Process for
ABB Large Motors and Generators

Number of Pages 54 pages + 1 appendix

Date 3 May 2017

Degree Master of Engineering

Degree Programme Industrial Management

Dr. Thomas Rohweder, Principal Lecturer

Instructors Sonja Holappa, MA, Senior Lecturer
Zinaida Grabovskaia, PhL, Senior Lecturer, Head of IM Master’s
Program
Ville Laurila, Strategic Sales Manager, ABB Large Motors and
Generators

This thesis focuses on the development of strategic selling through a Key Account Manage-
ment process in the case organization ABB Large Motors and Generators. This thesis was
carried out to strengthen the sales by gaining a better understanding of the highly competi-
tive markets and the customer value-creating processes, as well as the business needs of
the company to then develop and offer sophisticated value propositions for the company.
This thesis developed the key account management process for successful management of
the company’s current and strategically important potential customers.

This thesis was conducted as action research. The data collection mainly relied on inter-
views and discussions, as well as analysis of relevant internal documents. The interviews
were held with key account management team members, and the interviews were docu-
mented in field notes. These interviews provided data for the current state analysis and
building the proposal in collaboration with the case organization.

The outcome of this thesis is the Key Account Management process for ABB Large Motors
and Generators which includes the key account selection processes, selected key account
analyses, strategic marketing planning, communication processes and operational delivery
processes. The outcome of this thesis will help the case organization in applying the Key
Account Management approach in practice.

Keywords Key Account Management (KAM), market analysis, key ac-

count analyses, strategy, profitability
 4

Contents
Preface
Abstract
Table of Contents

1 Introduction 1

1.1 Business Context 2

1.2 Business Challenge, Objective and Outcome 2
1.3 Thesis Outline 3

2 Method and Material 4

2.1 Research Approach 4

2.2 Research Design 5
2.3 Data Collection and Analysis 7

3 Existing Knowledge of Key Account Management 10

3.1 Basic Concepts of Key Account Management 10

3.2 Key Account Selection Processes 11
3.2.1 Market Segmentation Process 11
3.2.2 Account Portfolio Analysis 12
3.3 Selected Key Account Analyses 13
3.3.1 Key Account Industry Driving Forces 14
3.3.2 Analysis of Key Account’s Strategy 15
3.3.3 Competitive View Analysis 16
3.3.4 Strategic Players Analysis in the Account 19
3.3.5 Key Account Value-creating Processes and Business Needs 21
3.4 Strategic Marketing Planning for Key Accounts 22
3.4.1 Key Account Marketing Planning Process 22
3.4.2 Key Account Planning Process 23
3.4.3 Key Account Profitability 24
3.5 Communication Processes 24
3.5.1 Account Team Communication Processes 25
3.5.2 Internal Marketing 25
3.5.3 Communication Process with Key Accounts 26
3.6 Operational Delivery Processes 27
3.6.1 Product Customization Projects 27
3.6.2 Non-standard Operational Delivery 28
3.6.3 Standard Operational Delivery 28
 5

3.7 Conceptual Framework of This Thesis 29

4 Current State Analysis 32

4.1 Overview of the Current State Analysis Stage 32

4.2 Description of Current Key Accounts 32
4.3 Description of ABB Global Account Management Practices and Analysis of Its
Impact and Usability on Product Group Level 34
4.4 Analysis of How Key Accounts are Currently Managed 35
4.4.1 Key Account Selection Processes 35
4.4.2 Selected Key Account Analyses 35
4.4.3 Strategic Marketing Planning for Key Accounts 36
4.4.4 Communication Processes 36
4.4.5 Operational Delivery Processes 37
4.5 Key Findings from the Current State Analysis (Data Collection 1) 37

5 Building Proposal on Key Account Management Process for ABB Large Motors and
Generators 39

5.1 Overview of Proposal Building Stage 39

5.2 Key Account Selection Processes 39
5.3 Selected Key Account Analyses 40
5.4 Strategic Marketing Planning for Key Accounts 41
5.5 Communication Processes 41
5.6 Operational Delivery Processes 43
5.7 Proposal Draft 43

6 Validation of the Proposal 46

6.1 Overview of Validation Phase 46

6.2 Developments to Proposal Based on Findings of Data Collection 3 46
6.3 Summary of Final Proposal 47

7 Conclusions 49

7.1 Executive Summary 49

7.2 Next Steps and Recommendations toward Implementation of the Proposal 50
7.3 Thesis Evaluation 51
7.4 Final Words 53

References 1

Appendices
 6

Appendix 1. Guide for conducting interviews used in this thesis

List of Figures

Figure 1. Research design of this thesis

Figure 2. Elements of industry structure
Figure 3. Expression of common customer driving forces
Figure 4. Conceptual framework for the Key Account Management process
Figure 5. Strategic players map
Figure 6. Annual overview of key account related meetings
Figure 7. Key organization members involved in the operational delivery processes
Figure 8. Proposal draft for the Key Account Management process
Figure 9. Final Proposal for the Key Account Management process

List of Tables

Table 1. Three rounds of data collection and analysis in this thesis

Table 2. Details of Data 1 collection used in this thesis
Table 3. Details of Data 2 collection used in this thesis
Table 4. Details of Data 3 collection used in this thesis
Table 5. Customers divided based on their attractiveness to the organization
Table 6. Customer attractiveness and competitive strengths criteria for account portfolio
analysis
Table 7. The competitive view analysis
Table 8. The current state strengths
Table 9. The current state weaknesses
 1

1 Introduction

The content of key account management has been studied by many leading researchers
such as Porter, Miller, Heiman and McDonald. Business world today is highly competitive
and more volatile than ever before. Technological revolution, globalization, mergers and
acquisitions, market regulation, manufacturing overcapacity, eroding margins, and
changing workforce demographics are factors, among many others, that are changing
the markets. Competition in these changing markets is at the core of the success or
failure of companies. Competition determines the suitable actions that are effecting to
the company’s overall performance. For this reason, the company needs competitive
strategy to grow and establish a profitable long-term position in its industry. These chang-
ing markets and high competition inside them are creating unprecedented challenges for
leaders, as well as for business managers, especially for those who manage strategically
important customers. Maintaining and building relationships with these selected custom-
ers has become essential to the company to sustain a profitable profile needed to survive
and grow in these volatile markets.

Key account management (KAM) is a marketing management approach based on rela-

tionship management on dealing with major customers, known as key accounts, in busi-
ness-to-business markets. KAM is not just relationship management, it is a framework
of processes related to market knowledge, key account selection, key account analyses,
communication and operational delivery process management of the most important cur-
rent and potential customers.

It can be said that all the customers are important to the company to gain revenue and
profits, but with scarce resources, it is impossible to keep up equally good relationship
with all the customers, irrespective of their size and profit. Therefore, companies need to
know who are the key accounts who can make a significant contribution towards the
company’s long-term objectives.

The objective of this thesis is to propose a Key Account Management process for ABB
Large Motors and Generators. The order for this thesis came from realizing the develop-
ment need of Key Account Management approach concerning how the Key Account
Managers should manage these strategically important customers in this ABB Product
Group.
 2

1.1 Business Context

The case organization of this thesis is ABB Large Motors and Generators located in
Finland. Globally, “ABB is a pioneering technology leader that works closely with utility,
industry, transportation and infrastructure customers to write the future of industries dig-
italization and realize value. With a heritage spanning more than 130 years, ABB oper-
ates in more than 100 countries and employs around 132,000 people” (New.abb.com,
2017).

ABB is organized into four global divisions: Electrification products, Robotics and motion,
Industrial automation and Power grids (New.abb.com, 2017). ABB Motors and Genera-
tors Business Unit makes one part of the Robotics and motion division.

The customers of ABB Motors and Generators are manufacturers, original equipment
manufacturers (OEMs) in a variety of industries and utilities, as well as industry end users
and infrastructure operators (New.abb.com, 2017). ABB Motors and Generators offers
them a comprehensive range of reliable and high efficiency motors and generators
(New.abb.com, 2017). This thesis focus on ABB Large Motors and Generators which is
one Product Group (PG) inside the ABB Motors and Generators Business Unit.

1.2 Business Challenge, Objective and Outcome

This thesis aims to give an answer to the burning question of how successful Key Ac-
count Management (KAM) can be established.

Presently, the key accounts of ABB Large Motors and Generators are identified and a
basic categorization of them exists on a higher organizational level, but the approach
concerning how key account managers should manage these customer relationships is
missing. Accordingly, the objective of this thesis is to propose a Key Account Manage-
ment process for ABB Large Motors and Generators. The outcome of this thesis is a Key
Account Management process for ABB Large Motors and Generators.
 3

1.3 Thesis Outline

This thesis is conducted qualitatively by interviews and utilizing existing knowledge of

key account management. According to the existing knowledge, the scope of the thesis
is limited to key account selection processes, selected key account analyses, strategic
marketing planning processes, communication processes and operational delivery pro-
cesses.

This Thesis is written in seven sections. Section 1 is the Introduction for this thesis. Sec-
tion 2 overviews the research approach, and the method and material used in this thesis.
Section 3 discusses the best practice research from existing knowledge related to key
account management to search the key elements for first proposal of key account man-
agement process for the case organization. The identified key elements are subse-
quently transformed into the conceptual framework. Later on, in Section 4, the concep-
tual framework is used for conducting the current state analysis and, in Section 5, for
building the proposal. Section 6 describes the results of the proposal validation. Finally,
Section 7 presents the conclusions of this thesis.

The introduction of this Thesis explained the big picture of the challenges that companies
are facing in the markets, and the importance of key account management in long-term
company objectives, growth and profitability. It also explained the business context
where this development need occurs, and the Thesis outline. The next sections help to
build a broader landscape of this Thesis.
 4

2 Method and Material

This section describes the research approach, method and material used in this thesis.
It also gives an overview of how this thesis was designed and how it meets the quality
requirements for a relevant and rigorous research.

2.1 Research Approach

This thesis utilizes Action research as its research approach, and it is conducted as field-
work to tackle the organizational issues. This research approach suits best for studies
where parts of one specific organization are developed by the researcher who is an ac-
tive member of the organization in question.

Action research tends to deal with real-world organizations and managerial problems,
while simultaneously accommodating the goals of science (Näslund, Kale and Paulraj,
2010: 331-332). It indicates the diversity of theory and practice by providing a choice for
potential action that might be appropriate for research question. The central idea of ac-
tion research is to use scientific approach to research the solution for important organi-
zational issue in collaboration with organization where this issue occurs. Action research
works through a process of planning, action taking, and evaluation of the action (Cough-
lan and Coghlan, 2002: 220-222). The desired outcome of the action research approach
is not just the solution, but the importance of learning from outcomes and the contribution
to scientific knowledge and theory.

Action research is typically conducted by utilizing qualitative research methods. One of

the most popular data collection method used in research design is interview protocol.
With a well-designed interview protocol, researcher can penetrate in-depth information
known by interviewees (Turner, 2010: 754). A well-constructed and professional inter-
view includes the preparation, the construction of effective research questions, and the
implementation of the interview. The importance of the preparation stage includes build-
ing and maintaining an unambiguous focus to the effective research study with the inter-
viewee. Selecting participants to the interviews makes another important step to obtain
qualified candidates who are willing to openly and honestly provide credible data to the
research. Another important element of the preparation stage is to pilot test the interview
design with a participant that have similar interests as those that are participating in the
 5

interviews (Turner, 2010: 756-757). This is conducted to reveal flaws, limitations, and
weaknesses of the design.

Another important step in qualitative research is the analysis and interpretation of the
data gathered from interviews. This analysis is typically conducted by uncovering and
compiling the findings into categories, or groups of themes, or research areas, typically
using the Thematic content analysis. These groups are identified from the consistent
phrases, expressions, and views that were common for all the participants (Turner, 2010:
759). After the grouping, it is suggested to review the groups to strengthen the quality
and rigor of the interview transcripts.

The data of this thesis is collected through interviews and feedback meetings in different
stages: in the current state analysis, building the first proposal and developing the pro-
posal draft towards the final proposal.

2.2 Research Design

Figure 1 below shows a graphical illustration of all the components of the research design
used in this thesis, followed by an explanation of the different steps and what data was
used to accomplish the objective of this thesis.
 6

Figure 1. Research design of this thesis.

 7

This thesis starts from a business development need identified in the organization, i.e.
the thesis objective. With a clear thesis objective established, existing knowledge and
best practice of key account management is reviewed from literature to build a concep-
tual key account management framework. This thesis is proposing a new KAM process
for the organization, for this reason the conceptual framework is built before the current
state analysis to provide a solid foundation for it. The current state analysis is conducted
through interviews with organization members where this development need occurs.
Based on the current state analysis and suggestions from existing knowledge, the pro-
posal for the KAM process is built collaboratively, and subsequently evaluated in inter-
views and meeting with the organization members involved in the KAM. The proposal is
co-created together so that it suits and works for the company.

2.3 Data Collection and Analysis

In this thesis, data is collected in 3 phases to develop a proposal that would fulfil com-
pany needs and works in a real-world business environment. Table 1 below provides an
overview of the collected data, data sources, data types, and the purpose of data in this
thesis.

Table 1. Three rounds of data collection and analysis in this thesis.

As seen in Table 1, first, Data 1 is collected individually in face-to-face interviews. This

data is analysed in-depth to understand the current state of the case company, and to
 8

find the strengths and weaknesses of current practices. Second, Data 2 collection is
conducted collaboratively with the KAM team to gather ideas for an optimal solution that
would suit and work best for the organization. Finally, Data 3 collection phase is con-
ducted to validate the final proposal and make corrections to make it ready for imple-
mentation.

A detailed overview of the research Data 1 is shown in Table 2 below.

Table 2. Details of Data 1 collection used in this thesis.

As Table 2 shows, Data 1 for this thesis was collected to conduct the current state anal-
ysis. Data 1 collection was conducted in face-to-face meetings in 3 interview sessions.
The sessions were mainly 2 hours long to get proper orientation to the interviews (Ap-
pendix 1 shows the interview guidelines used in this thesis). Documentation was con-
ducted by writing down field notes of the current state.

Next, for building the proposal, Data 2 was collected. A detailed overview of Data 2 is
shown in Table 3 below.

Table 3. Details of Data 2 collection used in this thesis.

 9

Based on merging the current state strengths of the existing KAM activities and the ex-
isting knowledge extracted from Data 2 collection, the proposal was collaboratively built
with the KAM team (the first proposal). This first proposal was subsequently inspected
and commented for development in the interview with the Strategic Sales Manager. A
detailed overview of Data 3 is shown in Table 4 below.

Table 4. Details of Data 3 collection used in this thesis.

As Table 4 shows, Data 3 made the final data collection phase in this thesis, and was
conducted for the validation of the proposal. This was conducted in face-to-face meeting
with the Strategic Sales Manager to get the approval for the final proposal. Meeting was
2 hours in length to allow enough time for co-creation and to obtain feedback for the
proposed solution. The validation of the proposed key account management process
was documented using field notes, and approved by the Strategic Sales Manager.

This method and material section overviewed how this thesis is conducted according to
the research approach and design, data collection and data analysis. Next section is
about best practice research from existing knowledge of key account management.
 10

3 Existing Knowledge of Key Account Management

This section discusses the existing knowledge and best practice of key account man-
agement. This is conducted to search the key elements for the proposal of the key ac-
count management process for the case organization. Existing knowledge includes the
areas of key account planning and implementation processes. The identified key ele-
ments are subsequently transformed into the conceptual framework later used for con-
ducting the current state analysis and building the proposal.

3.1 Basic Concepts of Key Account Management

Key account management (KAM) is a management approach aiming to build a portfolio

of key accounts and offering them tailored products and services on a continuing basis
to fulfil their individual needs (McDonald et al., 2000: 25). Key accounts are strategically
important customers, identified by the selling company, who significantly contribute to
the company’s financial objectives.

Over the last few decades, key account management has been a widely used strategic
customer relationship approach in business-to-business environment. Especially now
when emergent trends are transforming the business world, companies are increasingly
relying on KAM to build collaborative and mutually adaptive relationship with strategically
important customers (Marcos-Cuevas et al., 2014: 1216).

Key account management aims to manage these strategically important customers in-
tensively and in a coordinated manner. The primary focus of KAM is orchestrating inter-
organizational relationships to attain mutually beneficial goals (Marcos-Cuevas et al.,
2014: 1216). Inter-organizational alignment is a process to increase the organization’s
knowledge of the selected key accounts business concerns and opportunities, and jointly
develop value propositions and delivering them to the customer (Storbacka, 2012: 261).

Elements of KAM approach in this thesis include several key account planning and im-
plementation processes including key account selection processes, selected key ac-
count analyses, key account planning processes, communication processes and opera-
tional delivery processes. These processes are examined and discussed in more detail
in the following sections.
 11

3.2 Key Account Selection Processes

Organizations need strategical direction and focus to search and create new business
opportunities (Ansoff, 1988: 100). As strategy is an elusive and abstract concept, its for-
mulation does not produce immediate productive actions. Since management is practical
and result-oriented, some questions need to be asked, for instance, how strategy can
contribute to the organization’s performance. Strategy gives consistency and direction
for complex organizations to grow (Ansoff, 1988: 104-105). One essential requirement
for strategy is when a company is competing in markets which are rapid and where in-
terruptive changes occur. Under conditions like these, established organizational tradi-
tions, direction and experience is not enough for coping with the new opportunities and
threats. When an organization is confronting interruptive changes in the markets, organ-
ization also need to confront very difficult problems of their own. Organization need to
choose what kind of strategy organization is developing for future growth and profitability
(Ansoff, 1988: 106-107). These choices of strategies start from market analysis.

Some markets and market segments are always more important to the company than
others. Therefore, key account selection processes start from market segmentation. Af-
ter market segmentation, accounts are analysed by their attractiveness to the organiza-
tion (McDonald et al., 2000: 128). These are critical processes to enable organization to
allocate its scarce resources effectively.

3.2.1 Market Segmentation Process

Market segmentation is a process where the whole market is divided into smaller groups
called segments where customers have similar needs (McDonald et al., 2000: 109). Mar-
ket segmentation is conducted to have a profound understanding of how markets work.

Market segmentation starts from the market definition and market structure. Market def-
inition is crucial to measure correctly the market share and market growth, to identify
main competitors, and to create successful marketing strategies (McDonald et al., 2000:
111). To represent what happens in the market, different purchase combinations need
to be analysed; what is bought, who buys what from who, and for what reason (McDonald
et al., 2000: 112).
Market segmentation makes a vital element in key account management since in today’s
competitive business world it is hard to compete only with the price. It is almost certain
 12

that someone from somewhere can sell cheaper. Additionally, it is rare that the cheapest
supplier is successful anyway. This means that organizations need to find a way to dif-
ferentiate their offering from the competition, and this is what makes the eventual goal of
market segmentation (McDonald et al., 2000: 109-115). Market knowledge gives key
account managers a foundation for building a long-term relationship with their key ac-
counts.

3.2.2 Account Portfolio Analysis

Companies need to know who are the customers who can make a significant contribution
towards the company’s long-term objectives (McDonald et al., 2000: 1).

According to Cheverton (2008: 271-273), customers can be divided into 4 groups based
on their attractiveness to the organization, as shown in Table 5 below.

Table 5. Customers divided based on their attractiveness to the organization (Cheverton

2008: 271-273).
1. Key accounts are critical for future business and deserves special attention and
resources from devoted key account team. Attraction is mutual and key accounts
rate organization higher than other suppliers, but situations may change easily.
2. Key development accounts are those where future potential could lie. Key devel-
opment accounts currently prefer more competitors offering.
3. Maintenance accounts are good customers, perhaps even loyal. Maintenance
accounts rate organization highly, and are certainly personal favourites for many
in the organization, but are not viewed as attractive prospects. As these custom-
ers are maintenance accounts, resources should be pulled off from these ac-
counts and directed to where resources are the most needed.
4. Opportunistic accounts are those who are served willingly when it suits to own
interests. Right customers to do short-term deals for short-term gains. No great
attraction for the organization.

The relative attractiveness of customers can be evaluated by building an organization

specific criteria derived from different factors. Criteria need to combine long-term poten-
tial as well as short-term realities in a mixture of tangible and intangible, quantitative and
qualitative factors (Cheverton, 2008: 276). One approach on developing criteria is to
evaluate factors through different but overlapping considerations.
 13

As Wilson et al. (2010: 158) propose in table 6 below, there can be a number of factors
to choose from and included into the criteria.

Table 6. Customer attractiveness and competitive strengths criteria (Wilson et al, 2010:
158) for account portfolio analysis.

As seen in Table 6, one possible way to help in account portfolio analysis is to analyse
the customer attractiveness and the competitor strengths criteria. When selecting crite-
ria, business practice suggests to choose about 6 factors (Cheverton, 2008: 279). If more
is chosen, the rating of accounts tends to blur and every account falls into middle ground.
On the contrary, too few factors lead to a danger of being too narrow in the analysis.
Another thing is, that it may be hard for other organization members to understand the
basis of analysis (Cheverton, 2008: 279). Therefore, it might be beneficial to weight the
chosen factors to highlight the importance of certain factors, or their relation to own ob-
jectives.

After the Key account selection processes (including the Market segmentation and Ac-
count portfolio analysis) are completed, next step is to make a more detailed Selected
key account analyses.

3.3 Selected Key Account Analyses

The purpose of selected key account analyses is to produce a consistent strategic plan
for each of the selected key accounts. These analyses are prerequisite for key account
managers with deep understanding of their account’s industry, strategy, competition,
strategic players and value-creating processes.
 14

3.3.1 Key Account Industry Driving Forces

The first fundamental determinant of a firm’s profitability is industry attractiveness.

Competitive strategy must grow out of a sophisticated understanding of the rules
of competition that determine an industry’s attractiveness. The ultimate aim of
competitive strategy is to cope with and, ideally, to change those rules in the firm’s
favor (Porter, 2004: 4).

Business practice suggests that the rules of competition are typically embodied in five
competitive forces (Porter, 2004), i.e. threat of new entrants, bargaining power of byers,
threat of substitute products or services, bargaining power of suppliers, and rivalry
among existing companies. These forces vary from one industry to another and are
changing as the industry evolves. Importantly, competitive forces determine the com-
pany’s ability to earn returns in its industry. Figure 2 below illustrates the key elements
of industry structure (Porter, 2004: 4-7).

Figure 2. Elements of industry structure (Porter, 2004: 6).

 15

Figure 2 illustrates the element of the industry structure that drives the industry. Accord-
ing to Porter (2004), every industry has its own unique structure, and the industry struc-
ture is relatively stable. The most important information comes from the industry trends
that affect to the structure.

Satisfying the customer need is the prerequisite for viability in the industry and the com-
panies within it. Customers must be willing to purchase products and services from com-
panies at the price that exceeds the costs of production, otherwise the industry and com-
panies within are not surviving in a long run (Porter, 2004: 7-9). The crucial question is
how companies can capture the created value for the customers. The industry structure
determines and gives answers to that question.

Porter’s five forces framework helps to highlight the critical factors of competition in the
industry, and direct the focus of management towards the aspects that are most im-
portant to the long-term profitability.

3.3.2 Analysis of Key Account’s Strategy

This section focuses on analysing the key account’s strategy and ensures that this
knowledge is used to establish a link between company’s sales team and key account
(Hennessey and Jeannet, 2003: 135). This process helps building a successful key ac-
count team which can demonstrate to the account that together the companies can make
accounts business more successfully in its own industry.

First, the account’s corporate strategy is essential to understand because it sets the tone
for the whole business. While companies are affected by investors and industry, compa-
nies are under constant pressure to adapt on the way to respond to these pressures
(Hennessey and Jeannet, 2003: 111-112). Therefore, the key account team needs to
know and be aware of the key account’s possible strategic shifts and know the how it’s
affecting them.

Next, the account team needs to get a good understanding of the financial footprint of
the account. Even though the customer’s annual reports might show that its sales, profits,
and dividends are rising, annual reports probably do not tell everything. Therefore, there
is a need for financial analysis to understand the hidden risks and concerns in the cus-
tomer’s business. This analysis help to understand the ultimate financial situation of the
 16

account, and what the account is trying to achieve. Financial analysis aims to get a full
picture of the account’s enterprise and funding structure (Rice, 2011: 133-134). The most
useful parameters to gain insight into the account are ratios. Ratio trends show for ex-
ample how a company is managed, and forecast the future performance. Benchmarking
parameters against other customers are useful to get insight of relative strengths of dif-
ferent companies in the same industry (Rice, 2011: 145-146). To get most reliable picture
of how companies are performing, the best approach is to analyse trends in parameters
rather than at one point in time.

Next, the analysis needs to go down to the unit level. Most account teams do not face
the entire customer corporation; most likely the account team is associating with busi-
ness units. This needs further strategic analysis. Companies do business with products
and service scope; therefore, charting this scope tells how the company operates and
competes. Understanding the specific scope is helping the account manager to assess
the account’s needs, and uncover opportunities to contribute to the account’s strategy.
Geographical deployment, such as factory locations are important to determine the mar-
kets where the account competes (Hennessey and Jeannet, 2003: 115-119). If the cus-
tomer has different offerings for different markets, important information comes from the
market position by the market. With this knowledge, the account team can anticipate the
future moves of the customer.

Summing up, a thorough analysis of the key account strategy aims at making the key
account team a strategic insider (Hennessey and Jeannet, 2003: 135) of the customer
company.

3.3.3 Competitive View Analysis

Customers have many suppliers to choose from. Only those who suit best for the cus-
tomer are recognized as customer’s strategic suppliers. Competitive view analysis helps
the assessment of what is possible to achieve in this relationship, what kind of efforts it
requires, and is it worth a shared strategic future with the customer (Cheverton, 2008:
217).

Competitive view analysis starts by the analysis of the customer business opportunities,
ambitions and hopes for the future (Cheverton, 2008: 218). After finding out the cus-
tomer’s plans, the key account manager needs to find answers to questions about the
 17

customer concerns related to the future, the threats that the customer sees towards their
business, and the things that worry about these threats. Analysis of the customer specific
industry (discussed earlier in Section 3.3.1) and the customer strategy (discussed earlier
in Section 3.3.2) helps to find answers for these questions. For conducting this customer
business opportunities analysis, one way is to simply ask the customer. After finding
answers to these important questions, analysis turns to how the customer can see the
supplier (the company).

The analysis of the company’s strengths and weaknesses as a supplier is important

since it determines the direction for the future relationship, so it must be right and honest.
Again, the best way to conduct this analysis is to ask the customer. The goal is to identify
the areas where (a) the company make a positive impact to the customer’s ambitions, or
reduce their concerns; (b) where the company make a negative impact to the customer’s
ambitions, or increase their concerns; (c) how company can resolve these weaknesses
and how much that is costing. Along this discuss, it is also vital to check if the balance of
strengths and weaknesses endorse mutual respect and partnership, or is it forecasting
long battle over short-term profit (Cheverton, 2008: 219-220). These areas are covered
to map the position between the supplier and the customer. A true strategic supplier is
openly discussing about these findings with the customer.

Now when analysis about position between the supplier (the company) and the customer
is conducted, the company has enough information to consider what the competitor is
doing. Business practice suggests that, most likely, competitors are doing the same or
very close things.

The final and the most important part of the Competitive view analysis is to include com-
petitor’s strengths and weaknesses into analysis and put all into same positioning matrix.
After matrix is filled, there are three essential questions to answer: (a) what are the dif-
ferences between company and other suppliers, (b) is there anything the company can
do about it, and (c) is it be worth the effort (Cheverton, 2008: 217-221). Table 7 below
illustrates the competitive view analysis.
 18

Table 7. The competitive view analysis (Cheverton, 2008: 222).

As seen in Table 7, the competitive view analysis compares the company’s strengths
and weaknesses against the competitor’s in the positioning matrix. It also immediately
checks them against the customer’s business opportunities and ambitions, and the cus-
tomer’s threats and concerns. (Cheverton, 2008: 221). Taken together, the competitive
view analysis maps the differences between the company and other suppliers, and the
directions to overcome them.

Based on the results, key account teams can start considering if the attempts to do busi-
ness with this account is worth the effort. After the competitive view analysis, the key
account team need to map the strategic players in the account for setting a successful
strategy. This is discussed in the next section.
 19

3.3.4 Strategic Players Analysis in the Account

A company isn’t a person. It’s made up of persons. When you develop a business
relationship, it’s really the sum of those parts. – Damon Jones, Chief Operating
Officer, Miller Heiman (Miller at al. 2005: 77).

While managing key accounts, the key account manager might be dealing with dozens
of individuals who can affect positively or negatively to the relationship. According to
Miller et al. (2005), these individuals can be categorized into three groups: sponsors,
strategic coaches, and anti-sponsors.

Everyone who likes the key account manager or the company’s products and service is
not necessary a sponsor. According to Miller at al. (2005), to identify a true sponsor, he
or she must fulfil three criteria: authority, influence, and support. First, a sponsor has
authority in the customer organization and is essentially willing to make decisions that
deepens the relationship. Secondly, a sponsor has power to influence other people who
are critical parts of developing the relationship. For example, the things sponsors do or
say influence positively on how people in the account organization perceive the key ac-
count manager and the organization he or she represents. The reality is that sponsors
cannot be selected from the organization chart, sponsors need to be found. Sponsors
also see their self-interest in developing a relationship with the key account manager.
Therefore, the third criteria is the sponsor’s wiliness to strongly support the key account
manager’s presence in the account. Business practice suggests that identifying a spon-
sor or even better, sponsors is critical for success, as no long-term relationship with the
account is possible without them (Miller at al. 2005: 78-80). If in the account, there is no
one who fulfils these criteria, that should be identified as a major problem.

Strategic coaches are the people who have and can provide valuable insight on how a
supplier can be positioned more effectively in the account. To have such an impact, stra-
tegic coaches must fulfil three criteria: credibility, support, and account insight. First, the
strategic coaches need to possess a high degree of credibility within account senior
management and be respected on all the other organization levels as well. Without cred-
ibility, strategic coaches would not get the needed insight from the account organization.
Strategic coaches are influential people in the account organization, and strategic
coaches most likely have decision-making power. As sponsors, strategic coaches see
personal benefit in promoting the key account manager and the company in the account
organization. And for this reason, are willing to support this relationship development.
 20

Secondly, strategic coaches support the business between companies, and give advice
and guidance for building a long-term relationship. The third criteria of strategic coaches
are the willingness to provide insight about account’s business that only account insiders
have (Miller at al. 2005: 80-81).

In more detail, strategic coaches are normally senior managers, or senior management
consultants who know how the account organization operates, what concerns strategic
players, what are account’s strategies, and what drives the business. Strategic coaches
also know how operational level sets the budgets, allocate resources, and make pur-
chasing decisions. This information about account is critical for setting a successful strat-
egy. As discussed earlier in this section, sponsors and strategic coaches are quite simi-
lar, but the main difference is that the strategic coaches understand the account entirely
(Miller at al. 2005: 81). In successful account management, nothing is more beneficial
for the company than top-level insider.

Anti-sponsors are typically people who are working for the failure of the key account
manager and the company it represents. The danger of anti-sponsors is that anti-spon-
sors are capable of influencing the other strategic players in the account. There may be
various reasons for acting this way: for example, anti-sponsors may want some other
supplier in; or anti-sponsors have different business philosophies; or anti-sponsors may
feel that their authority is threatened, or other reasons, most often internal politics. Hav-
ing a sponsor is without exception means that there is also an anti-sponsor who needs
to be identified. Since many anti-sponsors are difficult to recognize among all who are
smiling, developing multiple relationships with individuals is important. Business practice
suggests that the best way to neutralize an anti-sponsor is by using the sponsor and the
strategic coaches (Miller at al. 2005: 82-84). In addition, it is useful to identify some other
individuals whose presence in the account is common but may be hidden and potentially
deadly. In every account strategy, there is a need to identify these strategic players.

To identify the strategic players, brainstorming with the account team is used to identify
the players who could be beneficial or harmful for the relationship and the strategy. When
strategic players are identified, strategic players need to be aligned with the supplier
organization. This is conducted by establishing internal cross-functional links inside the
organization. For every strategic player, there should be someone with an equivalent
level of authority in own organization. (Miller at al. 2005: 84-85) The goal of this step is
to ensure that all the links with right resources are connected and available when
 21

needed. The role of the key account manager is to orchestrate these links of contacts
and ensure that contacts are activated as often as needed, and the contacts towards the
account are orchestrated strategically.

Strategic players’ analysis of account discussed in this section is a critical prerequisite

and knowledge source for analysis of key account value-creating processes and busi-
ness needs discussed in next section.

3.3.5 Key Account Value-creating Processes and Business Needs

This section focuses on deepening the understanding about account value-creating pro-
cesses and business needs. Successful KAM aims to find answers to the following ques-
tions: What makes the account want a certain type of product and service. What makes
the account purchase these products and service from certain suppliers. Account expe-
rience is based on account’s expectations, but the experience is not only about the prod-
uct or service, it is a function of all internal and external factors (Gronroos, 2013: 360).

First of all, the offered products and service need to fit the account’s value-creating pro-
cesses in a way that it supports value creation in the organization’s everyday activities.
Any offer that does not support value creation is not interesting to the account, because
it is not creating the value the account want. The account’s everyday activities and value-
creating processes are the most important information organization need to know about
their accounts. It is essential to understand that the value-creation process itself does
not define what kind of service a person in the account organization is looking for. Many
suppliers can provide an acceptable solution to the customer, but key accounts require
certain wishes on how key account want the supplier and KAM to treat them. This nor-
mally narrows the scope of potential service providers with whom the customer wants to
do business. This is why KAM needs to know how to treat the account in a way that fulfil
his or her technical and functional dimensions of perceived service quality (Gronroos,
2013: 360). Knowledge requirement is related to the value system of the customer, which
determines what kind of solutions are acceptable and what are out of the question.

According to Gronroos (2013: 360), to fully understand and provide solutions to the pre-
sent and potential accounts, KAM needs to acquire account information as follows: (a)
value formation and value generation, (b) value system, and (c) account needs that are
formed from value-creating processes and value system.
 22

Summing up the Key account selection and Key account analyses sections, these ana-
lytical processes need replicability across the whole company. The company accrue sub-
stantial benefits from these key account analyses if the key account team is able to in-
stitutionalize this analytical approach across the organization. The company would gain
benefits from not doing the same job twice in different parts of the company, and not
having to reinvent the wheel all over again, especially when managers and executives
are being reassigned rapidly. Instead, the learnings from these analyses could be gen-
eralized and easily understood by others if all account teams would apply the same ap-
proach (Hennessey and Jeannet, 2003: 134-135). Just like the company has mandatory
reporting formats for financial matters, business practice suggests that it would be ben-
eficial to standardise the sets of key account knowledge and use them in a key account
management process.

The next step in a key account management process is to proceed to Strategic Marketing
Planning for Key accounts, discussed in the next section.

3.4 Strategic Marketing Planning for Key Accounts

This section discusses the elements of effective strategic marketing planning where key
account planning process is firmly placed. The end of this section is reserved for highly
important discussion about key account profitability.

3.4.1 Key Account Marketing Planning Process

There is substantial evidence that marketing planning results in greater profitability and
stability over time. Additionally, it reduces the friction and operational difficulties inside
the organization. Marketing planning is a managerial process which includes strategic
marketing planning and tactical marketing planning. Strategic marketing planning covers
a timeline between three to five years. A tactical marketing plan is a plan how to achieve
strategic marketing plan’s first year’s objectives (McDonald et al., 2000: 155-156). A mar-
keting plan is built on the company goal setting and it includes market knowledge, strat-
egies, and resource allocation for actions.

The first step of the marketing planning process is to observe company mission state-
ment and financial objectives. A strategic marketing plan needs to serve the company
 23

purpose and goals. The next step is to attach the comprehensive market overview (dis-
cussed in section 3.2) into the strategic marketing plan. From the market overview, the
planning process continues by involving summaries of market Strengths, Weaknesses,
Opportunities and Threats to the strategic marketing plan. These SWOT analyses lead
and help making assumptions for drafting marketing objectives and strategies of market-
ing plan. The marketing objectives are quantitative measurements of sales volumes, val-
ues, market shares and profits (McDonald et al., 2000: 156). The final step of strategic
marketing planning process is to finalize the alternative plans, resource allocations and
budgets.

Growth requires customers who want to buy products and service from the company
rather than from the competitor, and are willing to buy again. The strategic marketing
planning approach needs intelligence, confidence and courage. Unsuccessful organiza-
tions do not bother to do this and rely only on sales forecasts and sales related budgets.
Problem of purely sales approach is that the salespeople usually sell the products at a
maximum discount to the customers who are pleasant to work with. Preoccupation with
short-term forecast is normal for companies that are confused with the strategic market-
ing planning approach (McDonald et al., 2000: 158). Transforming the company vision
into strategies towards reality is the reason why strategic marketing planning is involved
into the KAM process.

3.4.2 Key Account Planning Process

This next section is about developing a key account plan. Without this vital process, it is
unlikely that the company can provide superior value to its key accounts, or achieve
sustainable competitive advantage (McDonald et al., 2000: 167).

The development of key account plan starts by producing a formal mission statement,
which states the role and position of the key account in the company’s account portfolio
(discussed in section 3.2.2) and shows the intended future direction for the organization.
To establish the strategic content of a key account plan, it is important to show these
expectations up front in the plan. Next, the key account plan illustrates account’s financial
summary for the three to five years’ timeframe. A key account overview attached next to
the account plan is like a market overview (discussed in section 3.4.1) but contains sum-
maries of the key account analyses (discussed in section 3.3). After the key account
overview, a key account plan sets out the objectives for the key account. Objectives are
 24

mainly about sales, profits and account penetration related. (McDonald et al., 2000: 163).
Key account objectives need strategies on how to achieve them. These strategy consid-
erations should be written down to the account plan. To finalize the key account planning
process, the plan needs to be put into a more detailed scheduled and budgeted actions
programme. The program has monthly objectives and main activities and responsibilities
with support requirements. These activities should be reviewed monthly with a relevant
team members.

As seen in this section, strategic marketing planning is mainly a set of market knowledge,
account knowledge, and strategies collected together and utilized by key account man-
agers and key account team members. The next short and important section is about
Key Account Profitability.

3.4.3 Key Account Profitability

It is obvious that profit equals revenues minus costs, however, it is not clear how and by
what means revenues and costs are influenced (Gronroos, 2013: 215). Decisions about
key accounts and strategy related resource allocation cannot be made without under-
standing the customer profitability (Cheverton, 2008: 350). Profitability of the key account
might be leaking away through resource allocation which is not justified (McDonald et
al., 2000: 176). By calculating the lifetime value of accounts, key account managers
reach to information on which relationships are critically important to the organization,
which relationships make little contribution to the total profitability, and which relation-
ships are not profitable at all (Gronroos, 2013: 165).

Strategic marketing planning, discussed above, leads the next step in the core of the
KAM approach, which is the different communication processes of KAM.

3.5 Communication Processes

Communication takes time, but good communication prevents time and other resources
to be wasted. This communication processes section discusses key account team com-
munication, internal marketing, and communication processes with the key accounts.
Good communication builds a foundation for a high-performance organization with mu-
tual objectives.
 25

While the marketing people are those who work to understand the value-creating pro-
cesses of customers, it is the whole organization who deliver the value to the customer.
Companies which persist organizing themselves in strict functions, such as salespeople,
engineers or purchasers, cannot achieve the needed integrated delivery of value to the
customer (McDonald et al., 2000: 158). Strict functions are driven by their own objectives
over to the broad company goals of customer satisfaction.

3.5.1 Account Team Communication Processes

Relationships and communication within the team are a team’s lifeblood. Respect and
appreciation towards other’s, and willingness to work together for a common good is a
must in team work. When relationships and communication in a team is ongoing
smoothly, it increases trust, mutual respect and team unity (Blanchard. 2010 :170).

Global account management is designed to understand the customer value-creating pro-

cesses and business needs in global perspective. GAM is an organizational layer which
help the resource allocation to serve selected global accounts (Hennessey and Jeannet,
2003: 15). GAM’s key role is to perform as a boundary-spanning coordinator between
two organizations, company and the global account. GAM provides gleaned information
about the external business environment to the key account team around the world. GAM
acts as bridge builder, gatekeeper, and information broker. Additionally, GAM operates
outside their own organization, there is always some degree of conflict related to their
role’s performance expectations, and conflict about loyalty toward internal contacts and
key account team. GAM has a central position within the own organization to link people
and departments to deliver global value propositions (Wilson et al, 2010: 128). GAM
manages the team communication process in order to ensure effective collection and
distribution of account information which helps development of successful strategical key
account plans, and ensures that appropriate follow-up is taking place (Wilson et al, 2010:
171). The core team should have frequent meetings where to communicate about ac-
count information and actions, and also to have formal review sessions with manage-
ment.

3.5.2 Internal Marketing

Internal marketing is a management process of attitude management and communica-

tions management. Attitudes and employee motivation towards customer-consciousness
 26

and service-mindedness need to be managed. Attitude management is a predominant

part of internal management for organization that are pursuing to achieve competitive
advantage through service. Managers and other organization members need relevant
information on how to perform as an effective service providers to the internal and exter-
nal customers. Information is needed about customer specific product and service fea-
tures, and about the promises given to the customer. Communication management part
is about how organization communicate back about their views of performance develop-
ment potential and findings about what customers want. Internal marketing is necessary
for good results (Gronroos, 2013: 387-388). Both parts of this two-way communication
process should be continuous, especially the attitude management.

Summing up, shared information and open communication are needed to make informed
decisions, and for this reason are requirements for high-performing organization. Infor-
mation sharing and open communication builds trust and encourages people for action
(Blanchard. 2010 :10). Encouragement reduces the risk of territoriality, and increases
organization health, agility, and flexibility.

3.5.3 Communication Process with Key Accounts

Communication with a key account is a critical determinant of relationship success, and

it can be used strategically. The first step is to identify strategic players (discussed in
section 3.3.4) to whom the communication should be addressed. The real communica-
tion is a two-way process as discussed in the previous section. Superior face-to-face
communication is a traditional salespeople skill, and it is needed as much by key account
managers. The only difference is that KAM needs to communicate with a far wider range
of people in different account functions. The second step is to develop a detailed key
account communication process that draws out important needs or purpose. The essen-
tial elements of a smooth and cost-effective communications process include selected
audience, communication need, message, medium, timing, weight of communication,
budget, and responsibility. When communication with the key account is a defined pro-
cess, it demands planning and follow-up as well. Ad hoc activity is rarely effective
(McDonald et al., 2000: 250-253). Specific focus on communication with key account
achieves clearer message, better balance and coordination of communication which
leads to a more effective transmission of information.
 27

The importance of good communication in development of high-performing key account

management, discussed above, leads to the next step in the KAM approach which is the
Operational Delivery Processes to the key account.

3.6 Operational Delivery Processes

An organization should expect requests to customize products and service for key ac-
counts, and for this reason, key accounts needs smooth-running operational delivery
processes to fulfil these requests.

3.6.1 Product Customization Projects

A key account manager needs to be prepared for the individual requirements of account.
Requirements for large product customization should be seen as opportunities for new
ideas and future business. However, the selection of product customization needs an
approval criteria to identify inherent issues. This approval criteria should be strategically
relevant with company objectives and include financial justification. In an ideal product
customization, strategically important projects are identified and picked up at an early
stage of requests and prioritized high. Product customization projects can be potentially
utilized later for own use in sales, and might eventually be as a standard industry practice
(McDonald et al., 2000: 256-259). Figure 3 below shows an expression of common cus-
tomer driving forces which affect the product customization demands.
 28

Figure 3. Expression of common customer driving forces (McDonald et al., 2000: 260).

All the common expressions of common customer driving forces in Figure 3 above are
linked to the key account industry attractiveness (discussed in section 3.3.1).

3.6.2 Non-standard Operational Delivery

As non-standard deliveries feature heavily on offers conducted by the key account man-
ager to the key account, KAM’s interest in operational deliveries should be focused on
the achievement of supportive, effective, and reliable processes. Operational people
might sometimes accuse KAM’s and other salespeople for promising to the customer
products and service that is inappropriate for the supplier’s operational processes to de-
liver. KAM does not have to be an operational expert, but he or she should have sufficient
knowledge about operations to be used in discussions with key account, and collect this
information in a matter that experts can understand the requests. Although customization
increases the change of risk, many potential risks can be anticipated by involving rele-
vant organization members into the discussions in advance. The process of customiza-
tion needs to be as normal as possible, so that there is as little resistance or expectations
that customization cannot be included in operational processes (McDonald et al., 2000:
264). However, if problems occur, high-performing organizations use a problem to con-
tribute organization’s learning curve by developing its processes.

3.6.3 Standard Operational Delivery

It is mistakenly understood that everything the key account purchases is different from
the company’s standard products and service offering. These standard operational de-
liveries might form a significant share of key account’s revenue. In these standard deliv-
eries KAM should be able to rely on the efficiency of company’s operational delivery
processes and should concentrate on more strategic issues. Even though it is a standard
operational delivery, key accounts expect to receive privileged service if, and when key
accounts want it. This might be against some people’s sense of fairness, and for that
reason KAM needs to secure acceptance of these privileged services from people in-
volved in operations and logistics. Such a positive customer separation is not going to
work if employees do not know who are the key accounts (McDonald et al., 2000: 260-
 29

261), so the whole organization and all other employees related to the operational deliv-
ery process need to know who are the key accounts and how key accounts should be
treated.

3.7 Conceptual Framework of This Thesis

Conceptual key account management framework in Figure 4 below is built from this sec-
tions discussed existing knowledge. Conceptual KAM framework is divided into 5 ele-
ments: (a) the key account selection processes, (b) the selected key account analyses,
(c) the key account planning processes, (d) the communication processes and (e) the
operational delivery processes.

The conceptual framework for the Key account management process is shown in Figure
4 below.
 30

Figure 4. Conceptual framework for the Key Account Management process.

 31

This existing knowledge and best practice of key account management discussed above
in Section 3 included the KAM elements that are researched by leading professors and
professionals in the field. The outcome of this discussion is the conceptual framework
for the KAM process shown in Figure 4 above.

This conceptual KAM framework is used as a foundation for the current state analysis
discussed next in Section 4.
 32

4 Current State Analysis

This section discusses the current state of the organization’s key account management
processes. The Current State Analysis (CSA) highlights the organization’s best practices
and development needs concerning the KAM approach. The CSA clears the organiza-
tion’s KAM background for section 5; building first proposal for a Key Account Manage-
ment process for ABB Large Motors and Generators.

4.1 Overview of the Current State Analysis Stage

After establishing the understanding about the different processes of successful key ac-
count management, the current state analysis focuses on the analysis of the critically
important parts of the KAM.

The current state analysis is conducted in 4 steps. First, the analysis focuses on the
description of the current key accounts. This is done by analyzing what kind of customers
these current key accounts are and in what kind of markets they compete.

Second, the current state analysis focuses on analyzing ABB Global Account Manage-
ment (GAM) practices and its impact and usability on Product Group level. This is done
by analyzing the GAM’s roles and responsibilities in the company and how this is cur-
rently done.

Third, the current key account management process is analyzed step by step as con-
ceptual framework of key account management suggests (discussed in section 3).

Finally, the current state analysis ends with the discussion of the current state strengths
and weaknesses.

4.2 Description of Current Key Accounts

Organization of the thesis is an international Original Equipment Manufacturer (OEM)

channel team who’ coordinates the sales of product group products and services to large
international machine builders. OEM is a traditional definition for companies whose prod-
ucts are used as components in products of another company, which finishes the prod-
ucts and sells them to the users. OEM and the customer work closely together because
 33

OEM often customizes the product design needed and specified by the customer. How-
ever, OEM in a different context might be defined as a company who buys products and
services and rebrands the package into a new product under its own brand. Large inter-
national OEM customers in the context of this thesis are purchasing large motor appli-
cations, and some of these large international OEM customers can be classified as Key
Accounts. As the KAM approach (discussed in section 3) prefers, these international OEM
customers are organized in segments to build and provide better understanding of the
markets.

Large motors are mainly used as components of other products like compressors, pumps,
cooling and ventilation products, different process machinery, and in diverse other large
machinery.

Compressors are used in a variety of applications and industries, from the largest pro-
cess compressors in the oil and gas industry to the smaller compressors in the commer-
cial and residential markets. Compressor products are mature technology with advances
in areas such as air quality, noise levels, efficiency and reliability. Compressors can be
treated as a segment if organization understand the buying behavior and business needs
of international compressor OEMs. The global industrial market size is about 15 BUSD
and the annual growth is about 6%. The main compressor manufacturers have manu-
facturing facilities in USA, Europe and Japan, but compressor manufacturers have also
established manufacturing facilities in low cost countries like China and India. Interviews
highlighted the importance and one of the main reasons of this International OEM chan-
nel team. It is to identify and provide solutions to serial OEM manufacturers. Compressor
segment is the most suitable for serial manufacturing in large international machine build-
ers. Operational delivery projects can be collaborative R&D projects to build a quiet, ef-
ficient and reliable serial manufacturing product with the key account.

The pump market is one of the largest consumers of electricity in industry. Global pump
market is about 26 BUSD and the market growth is the biggest in Africa and Middle east.
Global pump market is also at a mature stage and pump users are demanding techno-
logical innovations to improve operational productivity. The average energy savings po-
tential through economically viable pump system optimization project is approximately
20% but can be much higher with proper optimization. Interviews showed the challenge
of mature pump market where every operational delivery process is mainly non-standard
 34

and needs deep optimization to develop sophisticated solutions on account value-creat-

ing processes and business needs.

Cooling products include air conditioners, refrigerating equipment, air handling units and
chillers. Ventilation products are fans and blowers. Key trends in cooling and ventilation
are energy efficiency and lowering environmental impact. The global chiller market size
is about 8 BUSD and annual growth is about 6%, except in China where it is 13% and
in the Middle East it is even more. 26% of the market activity is in USA, 22% in Europe,
39% in Asia/Pacific and 13% in other countries. The main chiller manufacturers are
located in USA, Europe, China and Japan. The global fan and blower market size is about
10 BUSD with annual growth of 5%. The leading fan and blower manufacturers are
located in the USA, Europe and China.

The main competitors in these markets are various international and local competitors
such as GE, Siemens, TECO-Westinghouse, WEG, and many other motor manufacturers.

4.3 Description of ABB Global Account Management Practices and Analysis of Its Im-
pact and Usability on Product Group Level

ABB is a pioneering technology leader (discussed in section 1) and truly a global com-
pany organized according to its customers in roughly 100 countries. ABB has also orga-
nized its account management in a way that the global account management approach
suggests. Global account management strengths the sales efforts towards global cus-
tomers who are strategically important, demand and accept ABB’s global offering, and
have a central purchasing process.

Global Account Manager’s (GAM) role (discussed in section 3.5.1) as a boundary-span-

ning coordinator is to manage selected large international OEM customers in upper or-
ganizational level and to provide account knowledge to the Product Group (PG) level.
Even though GAM needs to provide knowledge to the PG, it might not be directly suitable
or precise for them. GAM is operating in a divisional level which includes various PG’s.

GAM practice impact and usability on PG level is analyzed from data collected through
interviews with key account managers and by examining GAM documentations.
 35

GAM builds sets of account knowledge in a form of account plan (discussed in section
3.4.2). This plan is a summary of account knowledge analyzed in different KAM process
phases (discussed in section 3.2 – 3.3). The account plan includes key data about the
account, its markets and products, global spread that justify the GAM approach, SWOTs,
issues, development needs, actions, potential business opportunities, strategic players,
values and needs, and performance targets.

Interviews revealed that there is no process on how this GAM knowledge is transferred
and utilized in PG level. Different GAMs have different practices on how to work and
collaborate with PG KAM. Some GAMs have regular meetings with the whole global
team but not with a certain PG, and some do not arrange any meeting.

4.4 Analysis of How Key Accounts are Currently Managed

As discussed earlier, the current state analysis is conducted by building a conceptual

key account management framework (discussed in section 3) as existing knowledge and
best practice suggests. From now on, this section is written following the same logic than
section 3, by dividing it into different KAM processes.

4.4.1 Key Account Selection Processes

The interviews showed that the market segmentation is in GAM’s responsibility, and he
needs to provide and suggest potential key accounts to the PG. Even though, interview-
ees noticed that it is also one of the PG KAM team’s purpose to examine potential ac-
counts, select and ramp them up, and assign developed smooth operational delivery
practices to the organization’s normal operational delivery processes. Key accounts are
selected in an upper organizational level, but every selected key account is not suitable
to be key account in PG. PG do not have a key account selection process. Accounts
may come and go without a formal process. The interviews highlighted the importance
of account portfolio analysis in PG level, even though there is no process for that.

4.4.2 Selected Key Account Analyses

Key account managers see that the key account analyses is in GAM’s responsibility.
GAM execute divisional level account analyses and summarise the knowledge into an
 36

account plan. However, GAM do not transfer this knowledge to the use of PG KAM. PG
KAMs understand and value the importance of key account’s strategical fit with ABB.
Even though account strategies are not documented. ABB`s competitive advantage is
not created by price. KAMs know some of the players in account organization and have
varying relationships with them. This is seen important while working together and know-
ing how to handle these accounts. Even though, there are no documented strategic play-
ers maps. Key account value-creating processes are seen in a way that key accounts
express their needs, and then the sophisticated solution for key account is provided in
24 to 48 hours of time. Some KAMs are trying to help accounts to gain competitive ad-
vantage by proposing insight value adding solutions for them.

4.4.3 Strategic Marketing Planning for Key Accounts

Strategic marketing planning is done in divisional level by GAM. PG KAM’s do not have
strategic marketing planning process. PG have meetings to where KAM prepare a one
slider of account overview, current projects, and strategical actions. Project timetables
are followed informal manner. Order intake is measured and the order pricing is in PG’s
responsibility. Order margins are known but profitability is not measured. Some KAMs
check profitability afterwards from old projects.

4.4.4 Communication Processes

PG KAM team is located close to each other and communication within that team is
constant and quick. Communication process towards or from GAM is not formal. Com-
munication inside the team or organization is conducted mainly ad hoc with relevant per-
sons from different functions. There are some named persons in these different functions
to handle key account related operational delivery processes. These functions are R&D,
quality, production planning and designing to with whom the capacity for key account
orders are tried to adjust to benefit key account. Orders are also checked in meetings
with design, purchase and project management to avoid problems during the operational
delivery process. Communication processes are not formal and are done in personal
manner. Some key account managers are trying to perform internal marketing and raise
the level of key account knowledge inside the organization. Project are mainly reviewed
and communicated with the key account by KAM, and sometimes the R&D engineers
from both organizations communicate with each other.
 37

4.4.5 Operational Delivery Processes

PG KAM team has their own mechanical and electrical R&D engineers to support fast
service and customization in operational delivery processes. Customization is mainly
done to optimize the efficiency of the whole package done with the OEM machine builder
according to the use where the product goes to. If there are many projects that need
quick solutions at the same time, the team has additional resources globally. This team
is the only team to handle multi-site projects for global customers. This means that the
key accounts global supply chain management organization can order straight from this
team and the Product Group is delivering to the different locations globally. Normally the
operational delivery process goes through local sales companies, but this is time con-
suming and service levels cannot be kept at the level required by the key accounts. Big-
ger R&D projects are transferred to organization’s R&D department. In these cases, a
bigger collaborative R&D project with the key account is established. The main part of
the KAM work is non-standard deliveries with little customization to the products. Non-
standard deliveries include orientation to the customer specification and making the quo-
tations for the requests. Account standard deliveries are handled by KAMs.

4.5 Key Findings from the Current State Analysis (Data Collection 1)

The main purpose of the PG KAM team is clear, but there is some variation how KAMs
see their own job role and responsibilities in the organization. Some processes of key
account management are present, but nothing is formal. How key accounts are managed
is KAM related, and account knowledge is mainly KAM’s own intelligence. To summarize
the current state analysis, below is the main strengths and weaknesses of current key
account management approach.

The main strengths of current KAM approach are listed in Table 8 below.

Table 8. The current state strengths

1. Global Account Management practice,
2. Quick response times and service level for key accounts,
3. Development needs in couple of processes are clear.
 38

The main weaknesses of current KAM approach are listed in Table 9 below.

Table 9. The current state weaknesses.

1. No formal KAM processes in use,
2. Job role and organization account management responsibilities are a bit confus-
ing for KAMs.

This section high-lighted the current state of key account management in the case or-
ganization. The next section focuses on building the initial proposal for the Key account
management process, based on the findings from the current state analysis and existing
knowledge. The strengths from the current state are included to the proposal. Since the
KAM approach in the case organization is quite partial, the proposal includes all the KAM
processes discussed in Section 3.
 39

5 Building Proposal on Key Account Management Process for ABB Large

Motors and Generators

This section merges the results of the current state analysis and the conceptual frame-
work towards the building of the proposal using data 2 described in Section 2.

Building proposal on Key Account Management process for ABB Large Motors and Gen-
erators discussed in this section is a value adding solution and the outcome of this The-
sis. The purpose of the proposal is to help the case organization to develop their key
account management process. This proposal is a solution brought to the practical level
and can be implemented in the organization in the future.

5.1 Overview of Proposal Building Stage

This proposal is conducted in 6 steps. First, the proposal building focuses on the devel-
opment of the key account selection processes. Second, the selected key account anal-
yses. Third step of the proposal building focuses on strategic marketing planning for key
accounts. Fourth, the communication processes for the case organization are estab-
lished. Fifth, the operational delivery processes are fine-tuned for high-performance key
account related operations. Finally, the proposal draft is build and graphically illustrated.

This outcome of the proposal building stage is a draft of proposal for the management
and KAM team evaluation. The proposal is conducted by utilizing existing knowledge
from Section 3 and the current state results from Section 4. Data 2 is conducted in col-
laborative meetings and it is considered for the first proposal. This first proposal is vali-
dated in Section 6.

5.2 Key Account Selection Processes

The global accounts are selected in divisional level. PG is working globally as well, and
to have Group level strategical approach and GAM support for account and market out-
look, PG should select accounts among these selected accounts. PG should use divi-
sional criterion and scale it to work out and match to its own competitive strategy objec-
tives. A mere criterion is useless without any PG level selection processes and analyses.
GAM have a tremendous account and market knowledge to be utilized in PG level. Ad-
ditionally, it is GAM’s responsibility to work as a knowledge broker, and this needs to be
 40

required from them. Account knowledge needs to be transferred with a two-way commu-
nication process in formal quarterly meetings between GAM and PG KAM. In these meet-
ings, the main account development projects of PG are followed-up.

Considering the GAM provided account knowledge and own analyses, PG KAMs should
do documented portfolio analysis of its present accounts and classify them into key ac-
counts, key development accounts, maintenance accounts and opportunistic accounts
as discussed in section 3.2.2. This should lead to critical evaluation of present key ac-
counts and possible reformation of resource allocation.

5.3 Selected Key Account Analyses

GAM produce a key account plan with already conducted analyses of key account to be
utilized in PG level. This key account plan should be used as a base for PG KAM plan-
ning, and updated with GAM in regular meetings. PG account plan should be modified
and completed with PG KAM related and analyzed account knowledge. Especially the
relationship position between PG and key account, and the competitor’s propositions to
the account should be analyzed in more detail to understand the relationship and future
business possibilities in the highly competitive markets. This should be included into the
plan.

PG KAM should map out the strategic players for their business by identifying the spon-
sor, anti-sponsor, strategic coach and other important players in the account organiza-
tion. A useful way to do this is by discussing within the account team and by analyzing
one person at a time to identify their roles and goals in the relationship. Figure 5 shows
an example of strategic players’ map.
 41

Figure 5. Strategic players map.

Key account value-creating processes should be documented and updated according to
possible strategical or industry driven changes.

5.4 Strategic Marketing Planning for Key Accounts

As already discussed in the two previous sections, strategic marketing planning should
utilize the sets of knowledge provided by GAM. This thesis suggests developing a stra-
tegic marketing plan according to section 3.4. With this researched approach, the KAM
process have strategical direction, planning, actions, and follow-up. Account profitability
and life time value for the organization should be calculated regularly, and based on the
outcome the current key accounts significance for the organization should be evaluated.
The PG account plan should be evaluated and reviewed monthly with the management
to secure effective key account management approach.

5.5 Communication Processes

Key account communication needs to be planned and scheduled as discussed in section

3.5. This thesis suggests quarterly account review and knowledge transfer meetings with
GAM. These meeting are concentrating purely on PG related knowledge. Before the
meeting, PG KAM have requested the GAM developed account plan and studied it. PG
KAM has also developed an agenda for this meeting and concentrating on PG
knowledge by asking open ended questions from the GAM to gain understanding about
the market and the account knowledge. In these meetings, also the PG KAM provide its
 42

Product Group related knowledge to the GAM. All the knowledge transferred is docu-
mented and updated into PG account plan, and actions according to the findings are
taken place.

PG KAM team meetings should be held monthly to secure updated account overview,
knowledge transfer and account plan follow-up. Meetings are held with strategic sales
manager and relevant invited quests if needed. In these meetings, the key account
salesforce portal is evaluated and followed-up as well. Salesforce is a customer relation-
ship management tool that ABB is using. Salesforce is utilized by KAM for quick com-
munication towards the whole organization, to evaluate and take actions according to
the opportunities and leads, and to follow-up the projects that are in pipeline.

Now that the PG KAM knows who are the key account organization’s strategic players
and understands the account value-creating processes and business needs, KAM
should start building the deep relationship with the key account. Communication towards
strategic players should be initial sales calls and meeting that are planned properly and
are scheduled. Meetings should also be arranged in account facilities in regular manner.
Figure 6 below illustrates the annual overview of key account related planned and sched-
uled meetings. Every meeting needs pre-event and at the event planning, as well as post
event action plan update for high-performing KAM.

Figure 6. Annual overview of key account related meetings.

Figure 6 above suggests 4 annual meeting with GAM and monthly meeting with PG KAM
team. Communication with the key account strategic players should be continuous and
have planned meeting at least 4 times a year for good relationship.
 43

5.6 Operational Delivery Processes

For smooth-running operational delivery processes the communication inside the organ-
ization should be formal, key members of key account operational delivery processes
should be clearly known by themselves and the KAM. These members should be docu-
mented in organization map as illustrated in Figure 7 below.

Figure 7. Key organization members involved in the operational delivery processes.

As Figure 7 above illustrates, the key account manager needs to have an ongoing two-
way communication process with all the departments in the organization. This is essen-
tial for high-performing operational delivery processes. These people should continu-
ously be briefed about key account information and organization should know precisely
the key account requirement and how the key accounts should be treated. All the mem-
bers in the organization should at the very least know who the key accounts are.

Standard deliveries should be assigned to the normal organization processes. KAM

needs to follow-up and make sure that operations are running smoothly and take correc-
tive actions according to that and inform the key account about the actions in progress
and actions outcomes.

5.7 Proposal Draft

The outcome of this section is illustrated in Figure 8 below. The proposal draft is done
for the Key Account Management process for ABB Large Motors and Generators.
 44

Figure 8. Proposal draft for the Key Account Management process.

 45

Figure 8 above shows that market segmentation is conducted in divisional level by the
global account manager. GAM provides the market knowledge for PG KAMs. The com-
pany in division level selects the key accounts according to the market segmentation
outcomes. From the selected accounts, PG considers and analyzes the potential pro-
spects for them with own portfolio analysis. With the market knowledge provided by
GAM, PG can better evaluate and start developing their own competitive strategies. PG
KAM team analyzes the present account portfolio and chooses how to continue and al-
locate resources according to that. After the account portfolio analysis, the key accounts
are selected.

PG KAM analyze the selected key account’s industry driving forces, strategy and com-
petitive view to understand the account business design and to start gaining knowledge
about the value-creating processes and business needs. Strategic players are mapped
next to develop a long-term strategic and effective relationship with the account. This is
conducted to gain valuable insight about how to do business with the account, and what
kind of value-propositions are effective for profitable outcomes. All the value-creating
processes and business needs are documented and used in value propositions to the
account. According to the account analyses, PG key account selection is conducted and
changes might occur.

Next in the KAM process, the PG key account plan is built by merging existing GAM
provided knowledge with own analyses. Key account profitability is calculated and ap-
propriate actions are taken. This might lead to key account classification changes.

Communication with GAM is a regular process to always have the latest knowledge and
effective key account management. Internal marketing is conducted for effective opera-
tional delivery processes and to distribute understanding about the key accounts, who
significantly contribute to the organization’s financial objectives and future business.
Communication with key account strategic players is a continuous process.

The last processes in the KAM process are the assured everyday smooth running oper-
ational delivery processes without standard deliveries to use the resources in important
strategical actions.

This section drafted the first proposal for the key account management process. In the
next section, this first proposal is evaluated, finalized and validated with the strategic
sales manager.
 46

6 Validation of the Proposal

This section describes the validation of the proposal for the key account management
process built in section 5. Validation equals trying out the solution in practice. Validation
is the act of proofing that the proposal is sound in the case organization context. There
are variations on how validation can be done and this section shows how it is grounded
for this thesis.

6.1 Overview of Validation Phase

This validation is conducted in 2 steps. First, the proposal draft is developed based on
the findings of data collection 3. Second, the main developments are summarized and
the final proposal is build and graphically illustrated.

This validation phase was carried out by revising the outcome of Section 5, i.e the pro-
posal draft, with the Strategic sales manager of the case organization. This was done by
going through every step of the proposed Key account management process.

6.2 Developments to Proposal Based on Findings of Data Collection 3

The validation session with the Strategic sales manager focused on the applicability and
the development of the proposed KAM process for the case organization. It was empha-
sized that the interviews done for the current state analysis, the data collected, and the
collaboratively built proposal revealed the need for KAM development in this organiza-
tion.

Potential of a successful KAM approach for business development is unquestionable.

Successful companies have organized it selves in this manner, and so is ABB, but not in
this PG. In this proposal validation phase, every process is examined in a detailed man-
ner to justify the reasons for including it into the KAM process proposal. KAM is a vast
management approach and it is not the easiest mission to implement and it takes plenty
of time. And for this reason, the implementation of the KAM process is excluded from
this thesis.
 47

The validation sessions acknowledged that this thesis proposal is collaboratively built,
and it contains elements of KAM processes that are adjusted and applicable to the case
organization. It is also in line with the ABB divisional level GAM approach.

6.3 Summary of Final Proposal

The summary of the final proposal with added processes highlighted are illustrated in
Figure 9 below.

Organization communication, especially through Salesforce and Salesforce utilization

needed to be highlighted in the final proposal in more detail. The name of the Global Key
Account Manager is changed to the Global Account Manager. Competitive view analysis
is highlighted in more detail to illustrate the importance of different SWOT analyses; Key
account SWOT in its own industry, Product Group SWOT with respect towards key ac-
count’s industry SWOT, and competitors SWOTs in the same market.

One highly important dimension to include to the final proposal and to the recommenda-
tions towards implementation is the top management involvement and support for offi-
cialization of its implementation.

The sponsor for this thesis proposal implementation could be for example the Global
Head of Key Account Management in ABB. This high-level sponsor involvement is a
critical factor for successful key account management process implementation and stra-
tegic orientation. With high-level sponsor the effectiveness of the KAM would increase
and this Product Group would not have to push the proposed process upwards in the
organization. The sponsorship is involving the Global Account Managers more deeply
into the collaboration and communication with the Product Group and for the effective-
ness of the whole Key Account Management approach in ABB.

Figure 9 below shows the final proposal for the Key account management process sug-
gested for the case organization.
 48

Figure 9. Final Proposal for the Key Account Management process.

 49

7 Conclusions

This final section interprets the results of the thesis in respect to the research challenge
and thesis objective. It also evaluates the thesis and express the conclusions about the
findings.

7.1 Executive Summary

This thesis focuses on the development of strategic selling through a Key Account Man-
agement process in the case organization ABB Large Motors and Generators. This the-
sis was carried out to strengthen the sales by gaining a better understanding of the highly
competitive markets and the customer value-creating processes, as well as the business
needs of the company. The thesis also strives to develop and offer sophisticated value
propositions for the case organization. Therefore, this thesis developed a key account
management process for successful management of the company’s current and strate-
gically important potential customers.

Key Account Management (KAM) is a management approach aiming to build a portfolio

of key accounts, who significantly contribute to the organization’s financial objectives,
and offering the key accounts tailored products and services on a continuing basis to
fulfil their individual needs. Presently, the case organization does not have a systematic
KAM approach.

This thesis was conducted as action research. The data collection mainly relied on inter-
views and discussions, as well as analysis of relevant internal documents. The interviews
were held with key account management team members, and the interviews were doc-
umented by field notes. These interviews provided data for the current state analysis and
building the proposal.

The current state analysis revealed that some of the KAM processes do exist, but nothing
is formal. The current state analysis proved the fundamental business development need
in the case organization.
 50

After the current state analysis, the first proposal of the KAM process was co-created
with the case organization. The final proposal was validated and finalized with the stra-
tegic sales manager. The co-creation and validation process for the development of the
final proposal included more detailed KAM processes, sponsor for successful implemen-
tation, and clear next steps and recommendations towards the implementation of the
proposal.

The outcome of this thesis is a Key Account Management process for ABB Large Motors
and Generators which includes the key account selection processes, selected key ac-
count analyses, strategic marketing planning, communication processes and operational
delivery processes. The outcome of this thesis will help the case organization in applying
the Key Account Management approach in practice.

The business impact and importance of this thesis for the case organization is significant.
This thesis transforms, if implemented, the organization with current ad hoc and imma-
ture KAM processes into an organization utilizing successful strategical processes for
key account development, selection, understanding, and partnership for long-term prof-
itability.

7.2 Next Steps and Recommendations toward Implementation of the Proposal

This thesis recommends, starting the implementation by identifying and involving a high-
level sponsor to support this KAM process implementation and future success.

The second step is to contact the company GAMs and explain to them that the PG has
started to develop its international OEM channel team KAM approach to strengthen its
sales and ensure long-term growth and profitability. The PG KAM should explain to the
GAM that the PG KAM wants to utilize the GAM’s developed market and account
knowledge and use the same account plan format for efficient follow-up, review and
knowledge transfer. The PG KAM also needs to clarify to the GAM that the PG KAM
needs to have quarterly meetings with them to carry out efficient knowledge transfer,
reviews and follow-up of PG related account knowledge and development projects.
When the first call or meeting with the GAM is done and the account plan is received,
the PG KAM should evaluate and get familiar with the account knowledge and replace
non-PG related knowledge from the account plan with PG related knowledge by starting
 51

the account analyses in a prioritized order and to start developing the PG account plan
in a scheduled manner.

Thirdly, the PG KAM team should have monthly meetings to follow-up the account plan’s
qualitative and quantitative objectives, actions, projects and development needs. In
these meetings, the PG KAM team should go through the Salesforce account platform
to assure updated account knowledge and communication.

The fourth recommendation entails strategical and scheduled calls and meetings with
the key account’s known strategic players to build a deep relationship with them, and to
strengthen and assure the sophisticated value proposals for the key account.

The fifth recommendation is to start account internal marketing in the organization, and
to arrange planned and scheduled account meetings with persons related to the account
operational delivery processes.

The sixth and one of the most important recommendations is to include account profita-
bility and lifetime value measurements follow-up into the account plan and continuously
measure the profitability of the operational delivery projects.

The seventh and final recommendation for implementation is to start a yearly account
portfolio analysis by first developing the PG account selection criteria and to classify the
accounts according to the PG strategy. All of these implementation recommendations
can be easily incorporated into this thesis.

7.3 Thesis Evaluation

The objective of this thesis was to propose a Key Account Management process for ABB
Large Motors and Generators. This thesis aimed to simplify the vastness of the key ac-
count management approach and the processes it includes for application in the case
organization. Every KAM process studied here can be examined in more detail and
depth. Due to the vastness and complexity of the KAM, the most needed development
for the proposal was to develop next steps and recommendations towards implementa-
tion. The recommendations strive to easily and understandably indicate ways to get
started with the developed key account management process.
 52

The thesis was conducted by first developing the research design to address the meth-
ods and material used to collect the needed data for the business development issue.
Existing knowledge used in this thesis is an outcome of best practice research of different
KAM processes researched by the top of the field researchers. This existing knowledge
was transformed into a conceptual KAM framework. Without the proper conceptual KAM
framework, the current state analysis would have been questionable and might have
lacked some important aspects of the KAM. With this research design, the first proposal
of the KAM process was collaboratively built by merging the conceptual KAM framework
and the current state strengths. Collaborative meetings were held to polish this draft to
the final proposition including next steps and recommendations for implementations. The
final step was the validation of the outcomes, which confirmed the relevance and signif-
icance of the outcome for the case organization.

In addition to the evaluation of the objective vs. the outcome, the evaluation also includes
the reflection on the research quality criteria. This highlights the importance of ensuring
relevance, rigorous, logic, validity and reliability during the research.

Rigorous research examines how research supports and justify the claims it makes. Ri-
gor and relevance are especially important while doing research for audience like busi-
ness community. Logic as research quality criteria means following general principles for
distinguishing sound conclusions from the specious ones. In this thesis, to strengthen
logic, the research design is built to ensure that the thesis starts from establishing the
business challenges and objective, beneficial to the organization, and ensuring the fit
between research and practice. The researcher also discusses the reasons for the deci-
sions made regarding the thesis. In order to address the needed relevance and rigor,
this thesis includes appropriate handling of various data collection aspects, collaboration,
utilization of field notes, and the implication of access and trust in research content.

Validity means “accuracy and correctness of data. Validity in interpretation means un-
derstanding the perspective of people studied, not own framework or meaning. Validity
pays attention to alternative explanations” (Huhta, 2014: 14). In this thesis, validity is
ensured by developing a qualitative interview protocol to be used and by analysing and
choosing appropriate people to participate in the face-to-face interview meetings. Relia-
bility of this thesis can be evaluated by the story it tells and does it make sense. Reliability
can also be evaluated by could another researcher do the same study and come up with
the same results.
 53

Relevance in research starts from analysing the researcher’s understanding of the exist-
ing knowledge and on how comprehensively the framework for research is designed and
constructed. In action research, relevant research helps managers to understand them-
selves and organizations better. Relevant research needs to deliver rigorous, workable
answers for managers to work with (Näslund, Kale and Paulraj, 2010: 347). In this thesis,
to strengthen relevance, the thesis develops relevant research insights into the areas
where development needs are identified by first developing the conceptual key account
management framework from existing knowledge.

The researcher of this thesis had to explore key account management related books and
articles to gain profound understanding of the key account management processes and
evaluate what would suit best for the business development need. This was done be-
cause the researcher did not have profound key account management knowledge to
start this thesis from the current state analysis, and because of the low maturity of KAM
in the organization. However, this brought a pleasant challenge for this thesis. After get-
ting familiar with the KAM approach and found the saturation point of the existing
knowledge it was time to start building the conceptual KAM framework of the thesis. This
thesis supports and justifies the claims it makes, and it delivers effective answers for the
implementation of the proposal.

Finally, the results of the thesis were evaluated as relevant for the case organization.
Key account maturity in the case organization is currently on the level where more de-
tailed process descriptions would be unnecessary and would have exceeded the scope
of the thesis. This thesis highlights all the necessary processes for successful key ac-
count management approach at this point.

7.4 Final Words

Business development projects, such as this thesis, are highly important for the organi-
zation and for the company as a whole. Customers are always the future of the business.
And while the markets are inevitably changing; slowly or rapidly, the supplier must un-
derstand the current and future situation of the customer, and develop a strategy to re-
spond to these changes and challenges. This means that some refit of direction needs
to be taken and processes need to be refined according to that. For example, the sales
have divided and evolved in recent decades towards key account management dis-
cussed in this thesis, and this is because the markets have changed.
 54

Business development is needed because the organizations do not probably have the
ability for natural regeneration to transform themselves as fast as the markets require
and the researchers recommend. Companies need to cope with the change to grow and
to be profitable now and in the future. Thus, ensuring professional personnel in the com-
pany is always the future of the business.
 1 (2)

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 Appendix 1
1 (1)
Appendix 1.
Guide for conducting interviews used in this thesis

In this thesis, to ensure high quality of data along qualitative data collection, the following
guidelines were used (developed based on Turner 2010):

Principles of preparation stage of interviewing included the following steps:

1. Distraction free environment;

2. Explanation of the purpose of the interview;
3. Explanation of the terms of confidentiality;
4. Explanation of the format and structure of the interview;
5. Time schedule for the interview;
6. Explanation of the next steps of the research and the way to get in touch with
after the interview;
7. Addressing if there are any questions before and after the interview;
8. Recording the answers into some relevant form. (Turner 2010).

One of the most crucial parts of the interview design was to construct effective research
questions. In this thesis, research questions were constructed to carefully investigate the
experiences and the knowledge of the participant to dig maximum data from the inter-
views. When constructing the questions, this thesis followed these guidelines (by Turner
2010):

1. Questions should be open-ended to let respondent to choose their own terms

when answering;
2. Questions should be neutral to avoid influential wording;
3. Questions should be asked one at a time to keep focus in investigated research
area;
4. Questions should be worded clearly to fit respondent’s used terms and culture;

It allowed to construct research questions in a flexible manner because interviewees did

not necessary answer to the question asked. “With questions that keep interviewee’s
focus in specific research area, the researcher also need to prepare follow-up questions
to ensure optimal and in-depth answers” (Turner, 2010: 757-758).