HOW MUCH DO YOU REALLY

KNOW ABOUT CREATING AN

EFFECTIVE KCRM
ORGANIZATION?
CHAPTER: 4

DOING THE RIGHT THINGS

BEFORE DOING THINGS RIGHT
Enthusiasm and skills are necessary for
successful development of key customer
business, but they can only work if they are
applied in the right direction.

We need to develop a helicopter mind, which

is constantly in touch with day to day customer
dealing

ANALYZING THE
CUSTOMER MIX
Identifying key customers is not difficult in some
businesses because the customers are selfevident.

In order to determine how best to use sales and

customer support resources to implement
customer management strategy, there are seven
steps in the process

STEP 1: PREPARE A
PARETO ANALYSIS

The Pareto analysis is complied by listing all

customers in decreasing order of sales and plotting
the cumulative sales related to the number of
customers.

PARETO

If all the customers

were in same size
then the straight
line would occur
The steeper the
ascent of the
actual line, the
greater will be the
concentration of
sales

STEP2: PROJECT FUTURE SALES

FOR TOP CUSTOMERS
Take top customers and try to make an individual
projection of yearly sales for each customers for the next
three years

Then calculate the percentage of total company sales

contributed by each individual customer, both currently
and end of the year 3 forecast.

STEP 3:PROJECT FUTURE SALES

FOR DEVELOPMENT CUSTOMERS

List any additional customers or potential

customers that have been identified as
target development customers, both
currently and at the end of year 3 projection.
Make an individual projection of yearly sales
for each customer over the next three years
and calculate the percentage of total sales
contributed by development customers

STEP4:PROJECT FUTURE SALES

FOR DEVELOPMENT CUSTOMERS

General business customers should be divided in to two

categories:
Customers who have existing or potential business
which can justify direct sales calls
Customers where there is not enough business to justify
individual sales calls but where collectively there is
enough business to warrant other forms of sales
coverage.

STEP 5:ESTIMATE RESOURCE

REQUIREMENT

Resource requirement will be quantified in terms of:

Minimum number of sales calls needed to achieve
forecast level of business.
Minimum number of technical support calls needed for
projected levels of business
Minimum number of deliveries needed for projected
levels of business

THE STANDARD CALL

10

In assessing sales call workloads, it may be useful

to think in terms of a Standard Call of average
time duration.
Depending on type of Business, this workload
analysis may be extended to technical support
calls.
The workload analysis should be extended on the
basis of the sensitivity of distributions (size,
distance, no. of unit, no. of delivery etc.)

STEP 6: CALCULATE TOTAL SALES

WORKLOAD RESOURCE AVAILABLE AND
CHECK AGAINST REQUIREMENTS:
Equation:

Total Sales Workload = No. Of Working Days X No. Of

Sales People X No. Of Standard Call/ Day

11

Having calculated the sales call resource workload required in

step 5 we now have four figures to juggles with the following:
Key customer workload resource needs (KCR).
Development customer extra workload resource need (DCR).
General business resource needs (GBR).
Available resource workload (AR).

12

Cont (Figure)

In evaluating
the
appropriatenes
s of the
Organization,
Four factors
should be
considered

Skills
Skills and
and
maturity
maturity

Geography
Geography
and
and cost
cost

Local
Local
contacts
contacts

Motivation
Motivation

13

STEP 7: ALLOCATING
THE RECOURSES

PLANNING FOR
INTERNAL RESOURCS
that
require fixed
amount of time
irrespective of
the number of
customers, order
or salespeople.
Example: Reports ,
Departmental
meetings.

VARIABLE

workload is
directly related
to the size of
customers, order,
or salespeople.

14

FIXED
Activities

INTERNAL RESOURCE
CALCULATION CHECKLIST
Telephone contacts inward
Telephone contacts outward
preparing quotations
Updating customer records
Preparation of presentation material
Showroom visits
Exhibition work

15

Departmental meetings and training

CAUTIONS ABOUT
TELECOMMUNICATIONS

16

Customers perception of a supplier is based on their

experience with telecommunications. For this reason:
Don't be afraid to over-staff your reception facility.
No incoming call should exceed four rings before being
answered.

HOW CAN IMPROVE

SALES FORECAST
Repeat end-users
Sales to distributors

17

Contract or capital goods sales

REPEAT END-USERS

18

Tabulate past figures of customer total

usage
Tabulate past sales figures
Calculate share of the customers
business
Estimate changes in the customers
future business
Estimate changes share of the
customers total business
Translate estimates into numerical
forecast
Consult with and check out forecasts
and mutual expectation

SALES TO
DISTRIBUTORS

19

Final user market

Final user share

CONTRACT OR
CAPITAL GOOD SALES
Divide the year into four quarters.
Estimate the likely sales value.

20

Estimate the probability of getting the contract.

Estimate the probability of securing the contract.
Calculate the forecast value per quarter

A METHOD FOR FORECASTING

CONTRACT SALES
Tk 000 value

Contact
Probability

Contact A

200

75%

20%

60%

20%

--

30

90

30

--

Contact B

200

20%

50%

50%

--

--

20

20

--

--

Contact C

400

50%

--

10%

50%

40%

--

20

100

80

130

130

80

Q1
Q4

Q2

Q3

Q1
Q4

Forecast per quarter

Tk 000

50

Q2

Q3

21

Timing Probability

Estimated
Value tk
(000)

HOW DO CUSTOMER
TEAMS WORK?
Team members and their responsibilities:
Regional sales if the customer has widespread
geographical locations or international operations.

22

Customer service if there are specific service

complications and emergencies with major
implications for the customers operations.

Team members and their

responsibilities

23

Technical if there are possibilities of special

product application.
Training if there is a significant education element
to ensure the customer gets the full benefit of your
products.
Product experts if there are highly specialized
product involved.

Team members and their

responsibilities
Internal sales if there is a high incidence of direct
customer-supplier communication by telephone
and fax.

24

Distributions if the schedule of deliveries is

complicated and exceptional degrees of flexibility
and responds are paramount.

Team members and their

responsibilities
Advertising if creative merchandizing and
promotion are major aspects of the customer
relationship.

25

Production if product availability, inventory or

fluctuations in demand are sensitive areas of the
customer relationship.

Team members and their

responsibilities
Finance if there are significant financial
implications in negotiation, such as leasing, capital
investment or taxation.

26

Senior management if high-level company politics

are significant relationship factor