Winning a big business deal is like hitting a home run — exciting, but rare. For utilities that focus on maintaining relationships with key accounts, the winning strategy is to keep these connections strong using both traditional and new approaches.
Utilities’ efforts to retain these top accounts include well-planned and supported programs that use genuine relationships to understand and meet their customer's unique needs.
While public power utilities understand that these accounts make up an important and often significant portion of utility revenue, the Strategic Account Management Association said they often aren't given enough attention considering their value. Its 2014 report showed that few strategic account executives found their programs were "functional and effective" (just 14 percent), yet nearly three-quarters said that customer relationships had been "repaired or saved" because of them.
Erick Rheam, a trainer on key accounts topics for the American Public Power Association’s Academy and an executive with an energy management software company, likes to ask utility managers what would happen to their community and their utility if their three biggest businesses left.
"Do you have something in place that if this did happen, you could say 'We did everything we possibly could with the resources we had and with the team that we had to provide the best possible service'?"
Maintaining multiple connections
At Austin Utilities, which serves about 12,000 customers in the southeast corner of Minnesota, the importance of business relationships moved the utility to be actively involved in an effort to reward businesses for locating in the region or expanding. It has also bolstered connections at several levels through its key accounts program.
Those accounts are just one of the responsibilities for Kelly Lady, manager of marketing and energy services, who said she builds relationships with the heads of local companies and responds to their individual "hand-holding needs," but also connects others with the organization.
"I deal with the maintenance person or the finance person, or whoever needs our help,” she said. “Although the president of the business knows they can contact me, other people need my help more often and more directly."
Shannon Murfield, manager of energy services for Missouri River Energy Services, a joint action agency with members serving 61 communities in four states, says that her organization also prioritizes keeping key account relationships firm and wide-ranging through multiple links.
"We make sure, for instance, that key account contacts are three deep. If your primary contact leaves the organization, or is not available for an extended period, you want to make sure there are at least two other people there that you have a relationship with," said Murfield.
For Kat Linford, public relations, key accounts and energy efficiency manager for Provo Power in Utah, multiple relationships were key in a complex collaborative effort to upgrade the service at Intermountain Utah Valley Hospital.
"The upgrades help them in the event of an emergency by providing automated switching from a primary to a secondary redundant circuit as necessary. The collaboration and teamwork from both entities at various levels on this project made for a smooth transition and a clear understanding of expectations."
Rheam stresses that no matter the dimensions of the key account program, it should prioritize building various relationships with the customer, between the customer and other departments at the utility, and even the entire municipality. “You'll learn something different from each one," he said.
"Too often we put ourselves in a box. But a key accounts person can really represent the entire municipality with this customer," he said, noting that an important customer might find it helpful to have information ranging from street plowing or paving priorities to whom to see about expansion plans. "It might be that nine out of 10 times the contact doesn't have anything to do with the utility," he said.
Buy-in on both sides
Rheam said that to develop an effective key accounts program, there has to be support from management and throughout the utility and municipality, often gained by showing how such a program can pay off. This should include buy-in from the utility manager, the manager of the municipality, heads of other municipal departments, and members of a utility commission or city council.
“Make it tangible for them. Managers often deal with black-and-white data every day — and if someone comes in and says, ‘I want to build better relationships with customers,’ it is hard for them to grasp that. But if you can tell them there is $4.5 million at risk, now you've got their interest and can have a meaningful debate.”
To get buy-in from the customer, a series of behaviors are expected — honesty, promptness, accuracy, and dependability, according to Murfield.
“Whether it’s returning a phone call or email in a timely manner or getting back to your contact with an informational article or lighting audit that you committed to provide, do it accurately and on time,” she said. “We also make a serious effort to understand the key account’s business, processes, and equipment. Being able to talk to your contacts on their level goes a long way toward building a trusting relationship.”
Rheam agreed and said that acquiring such information is a key step in showing the contacts that the relationship will create value.
“The needs of an air separation plant, where power may be 90 percent of its operating costs, are different than a big box store,” he said. “But they are both important to the utility and the community. And both will appreciate you understanding their business.”
The report by SAMA put it this way: “Engage clients strategically. Have an executive presence, know the customer business, demonstrate value to the customer, and become a trusted advisor.”
Choosing, planning, and checking in
As utilities develop or build a key account program, it is important to consider which customers should be included and how extensive the work with them will be.
Rheam suggested a framework with three program levels — basic, standard, and master's — that range from where a manager can devote less than one quarter of their time to responsively working with a number of accounts, to one where 20 customers are managed by a full-time person who proactively connects with them in a variety of ways. Each of the three levels of service for key account management is described in detail in the Key Accounts Field Manual, which Rheam co-authored for the American Public Power Association.
“No matter how sophisticated or extensive your key accounts program is, working with these customers is critical,” he said. “And while the discussion may change, the fundamental requirement that you build relationships and create value for them does not.”
Rheam and others recommend that a few customers — maybe five — get the “master's level” treatment, while other important key accounts are managed more responsively.
Linford works with about 60 key accounts identified by their demand or monthly bill, generally providing support when they request it, as she has a number of other responsibilities. Other public power utilities have only a small number of key accounts in their program and give them wide-ranging individualized service and information.
SAMA reports that, regardless of the size, "identifying and recruiting" potential accounts was one of a handful of critical elements to define in a key accounts program. It also noted that the process of building a program takes patience and persistence. Survey participants reported it took about four years to build a strategic account management program.
Linford, whose utility serves about 35,000 customers, says the process requires persistence to find the right contacts and build relationships.
“Finding the right person in the proper position who understands the role of a key account manager is a never-ending task, due to management and position turnover,” she said.
Rheam said it is critical to have a specific written action plan for each key account based on information about the customer, its finances and personnel, energy usage, goals, and even potential barriers to success.
To assess the program, some key account managers do surveys or other evaluations and some collect information anecdotally.
“The best feedback often is a phone call,” said Linford. “When I receive a call from one of my accounts — or because one of my account contacts referred me — it is gratifying to know that I have made the right impression and I have created trust with them. They know that I can and will help them.”
With the dramatic changes in the energy industry there naturally are challenges and opportunities in the ways that public power utilities can serve their key accounts — from providing sophisticated load management or rate structure options to supporting these customers as part of new community development efforts.
About five years ago, Joel Gilbert, industry veteran and president of Apogee Interactive, was a bit pessimistic about the ability of utilities to keep up with the expectations of large companies.
“The natural assumption you have right now is that, if you have customer service excellence, if you keep the lights on, if your bills don’t go up, and if you invest in the customer relationship, your relationship will be excellent. I’ve got news for you," he said at a conference in 2013. He pointed out that many businesses were generating their own power or planning such a move and that they were expecting more sophisticated service.
Gilbert now says that at the time he felt that such end-point distributed generation was becoming a challenge, and that utilities were losing knowledge about the technical needs of their key accounts and weren't serving big accounts well. He still somewhat believes that today, but he thinks there are growing opportunities.
"It's not that what I said was wrong, but there is a new agenda that will transform everything," he said. He asserted that beneficial electrification will “bring new life to things like electric lift truck marketing, microwave drying methods, and other uses where the efficiency of electric technologies makes it compelling.”
Some large customers want to purchase energy from solar sources and utilities "who can make this easy and affordable will win very large deals," he said, predicting that other opportunities to develop microgrid partnerships as part of industrial development efforts could become part of key account initiatives. “It is better than having the customer simply leave the grid.”
Other experts expect key account managers will use much more sophisticated data about energy usage and rates — and about how efforts with key accounts are paying off with customer relations management software.
Mark Nibaur, general manager at Austin Utilities in Minnesota, sees involvement in economic development as a key way for public power utilities to attract and assist some of their most significant accounts in the future.
Nibaur has been a key player in a "Grow Austin" initiative that involves a team of officials from municipal government and economic development organizations that offer businesses that create jobs in the region a package of benefits, including rebates from the utility.
To qualify for rebates, businesses have to show they have invested $250,000 in real property improvements within one year of designation and created at least three full‐time, permanent jobs. "It brings new jobs for people here and new loads for the utility, and it expands the local economy," Nibaur said.
Key players in the group meet bimonthly and have developed critical marketing materials for the incentive program, which both attracts new businesses and rewards existing businesses that are growing.