Account retention: Whose job is it anyway? All B2B service contractors face the challenge of retaining customer accounts to survive – and yet rarely structure or resource themselves sufficiently for it.
Contractors philosophically wrestle with how to efficiently and cost-effectively retain accounts; wondering do they:
- Create a standalone internal department with veto powers to overrule & direct operations & sales?
- Layer in a quasi-sales/account relations group to hand-hold customers in times of angst & indecision?
- Rely on their site & regional operations to deliver 5-star, luxury-customer accommodation – on top of their budget-obedience, scope-compliance, & regulatory-adherence?
Then there’s the Cost
For many service contractors, account retention ain’t cheap.
Large service contractors may have the luxury of employing a Strategic, National, Global, or Key Account Group with dedicated full-time employees. But rarely if ever with 10 or more headcount, typically it’s a handful or less with an executive overseeing it all. And having billions in annual revenue makes covering the cost of an elite group of account retention specialists more acceptable.
However, medium-sized to smaller contractors typically avoid formalizing their account retention with dedicated headcount. Even though they may spend significantly to win new work, their approach to account retention is “we’ve-always-done-it-this-way.”
Expecting a Lot from Operational Teams
Account retention is often a faraway assumption. It’s commonly assumed to be the site and regional operation team’s responsibility. And if that customer contract is lost, those staff supported by that account are released (aka let-go or fired) if they can’t be reassigned.
Yet, realistically account retention is not the sole, even primary task in an operational job. Operations are supposed to manage staff and budget and deliver service in-scope, on-schedule, and within the law. Yes, there will be the ubiquitous bullet point for managing customer relations but with the heady list of other required tasks, it’s can be an overly ambitious ask.
Individuals hired for those operational positions are never (extremely rarely?) empowered to overcome organizational silos and connect executives, sales, safety, operations, etc. to implement a comprehensive retention process. That’s not what they were hired to do. Why expect that of them?
The Default of the Many
Many service contractors take the “additive” approach, where account retention activities are piecemealed separately, and laid onto the existing staff.
These half-measures are the norm. They’re informally assigned to operations, sales, and executives to form a loose, wobbly and ultimately incomplete approach to what should be contractors’ number one imperative: retain their customers’ accounts.
And with “now you have to do this too” initiatives, there are the corresponding motivational challenges of:
- How fast are account retention initiatives adopted?
- How is employee participation sustained to keep initiatives thriving?
For the Few, the Future is Here
There are a very few enlightened service contractors seeking a more holistic approach to the life of their customers.
Account retention, as a management concept, can be subsumed in getting closer to customers. And by doing so, enables a greater degree of mutually beneficial influence:
- Don’t customers want to know from their subject matter experts (contractors) how their outsourced services can be better, faster, cheaper?
- Aren’t there better, relationship-based ways of contracting outsourced services (Vested)?
But there will always be aspects of account retention that are solely contractor-based; that lie outside delivering and contributing to customers’ desired outcomes.
It’s the balance between managing account retention while serving customers’ needs that’s the trick; a balancing act of service contractors’ survival.
First published on LinkedIn.