Meet your Amazon.com Account Manager

Have you ever wondered why you’ve never received an email from Jeff Bezos, introducing you to your new Amazon account manager?

You haven’t, right? Because you need an Amazon account manager like a fish needs a bicycle.

While some folks might like the idea of an account manager, the cold, hard reality is that an Account Manager would only be value-neutral to the extent that they are not involved with your Amazon transactions.

If you had an account manager and they somehow managed to involve themselves in your transactions, the value they destroyed would be exactly proportional to their involvement.

This is not unique to Amazon. You would not be happy if banks made a change that required you to interact with tellers again (rather than with automated teller machines). Or if Robinhood or eTrade required you to go back to talking to “advisors”.

B2B is different, right?

These are all examples from the B2C economy.

It would be tempting to assume that account managers do add value in the B2B economy. After all, products and services are more complex, and transactions tend to have a higher dollar value.

But it’s very dangerous to assume that because Account Managers add value in some cases, they add value in all cases. This is exactly the careless logic that leads B2B executives to assign account managers to customers, and, in my estimation, this practice is frequently highly destructive.

Let me share an example to illustrate.

Over the years, we’ve worked with a number of organizations that build specialized machines for manufacturing. These machines tend to be expensive, and consequently, they are extremely important purchases. Furthermore, the delivery of one of these machines is typically followed by a commissioning process, during which significant resources are deployed to bring the machine to its intended operating state.

The purchase of one of these machines would appear to be about as far from a typical Amazon purchase as you can possibly get, at least until you dig a little deeper.

It turns out that many machine builders’ best customers are large manufacturers, who consistently purchase additional machines. These manufacturers tend to train their own crews to maintain (and even commission) these machines, and these crews generate a steady stream of spare parts orders.

While it’s true that the initial purchase of a new machine cannot be likened to a typical B2C Amazon transaction, the purchase of subsequent machines can (and the purchase of spare parts most definitely can).

If you’re a billion-dollar manufacturer, placing your seventh order for a machine to open a new line, this purchase is not much more consequential than your recent Amazon order for a few pairs of new socks.

When one size doesn’t fit all

It’s clear from our machine-builder example that there are specific cases where the involvement of a capable human being adds significant value to the customer.

But even our manufacturer of custom, high-value machines should be careful not to interpret this observation as a mandate to allocate account managers to all customers. There are three additional considerations.

First, as we’ve discussed, not all transactions are complex.

Second, if we look at cases where a human adds value, it’s not clear that the same human should deliver value across all case types. Before purchasing, a customer will want to have both commercial and (deeply) technical discussions. Post purchase, interactions will be almost exclusively technical in nature (commissioning and support).

The third consideration is geography. Traditionally, a customer would value (and be prepared to pay for) a local representative. Today, a customer would much prefer to interact with a specialist by phone than a generalist in person. (And they are extremely unlikely to willingly pay a premium for a local generalist!)

If we take advantage of the opportunity to assign specialists to different task types, we have the following requirements. A commercial specialist to sell the initial machine and to attempt to upgrade the customer to a materially different product (or proposition) in the future. A technical specialist to assist with the sale, and with post-sale commissioning and support. And a capable customer service representative who can assist the customer with simple transactions, moving forward.

If the customer has access to these resources, in most cases, they do not have an additional requirement for “account management”.

In fact, if we were to assign an account manager to this customer, they would degrade service quality by assuming responsibility for activities that specialists would otherwise perform. 

A common justification for the account manager role is that the customer needs an advocate within the vendor’s organization. If this is the case, you should identify and remedy whatever internal dysfunction is giving rise to this requirement. The addition of an Account Manager as a kind of human Band-Aid actually perpetuates the organization’s design flaws, as well as inflating costs.

When an Account Manager DOES add value

There is a particular scenario in which an account manager adds significant value to both the vendor and the customer.

In this particular scenario, we have a very large customer that has a complex commercial relationship with the vendor. This complexity is the result of numerous initiatives in play concurrently, involving different departments in both the customer’s and the vendor’s organizations.

Some of these initiatives might involve the purchase of new products. Some might be the onboarding of products previously purchased. And some might consist of upgrades to existing commercial relationships.

In such a case (which is common where very large accounts are concerned), each initiative takes the form of a mini-project. Each project has its own champion (on each side of the fence). And all of those champions do exactly as their title suggests: they lobby to get their projects completed as soon as possible.

Now, of course, neither the customer nor the vendor has boundless capacity. The result is resource contention: multiple parties within each organization battling for access to one or more limited resources. (More often than not, these scarce resources are within the engineering or technology departments.)

This creates the requirement for an adult in the room who can adjudicate these conflicting demands (on both sides of the fence) with a view to the longer-range priorities of both organizations.

And, of course, account manager would be the perfect title for this role.

It should be evident that very few customer relationships in a typical organization rise to this level of complexity. However, for the few that do, there is a critical requirement for account management, as it’s described above.

The cruel irony is that most organizations assume a general requirement for account management and assign an account manager to as many customers as possible.

Rather than providing strategic oversight (which most customers simply do not need), they busy themselves with the management of transactions, which actually degrades service quality, inflates costs, slows growth and mutes the imperative for operational improvement.

Where typical transactional customers are concerned, your organization should be designed to make this role redundant. If you have account managers today, those individuals should be focused exclusively on the pursuit of new business.

If you have large, complex accounts, you absolutely must assign an account manager to them. However, this individual should not involve themselves directly in transactions or even sales opportunities except in extraordinary circumstances. Their job should be to provide strategic oversight — to drive the development of a productive partnership between the two organizations.