Strategic account planning can help EMS program managers align customer relationships with long-term growth, profitability and operational goals.

For many electronics manufacturing services (EMS) program managers, just managing tactical account issues is more than a 40-hour-a-week job. Thinking about strategy can be difficult when an inbox is full of urgent emails and the phone is ringing with additional problems to solve several times a day. While blocking out time to develop a broader-picture account strategy doesn’t necessarily eliminate that workload, it does create a foundation for determining whether adequate resources are devoted to that account and whether the account is a really good fit for the EMS provider’s business model.

The basics are simple. List the following:

• Core decision-making team
• Current business dynamics
• Core value proposition
• Subordinate value propositions
• Service enhancement needs
• Growth opportunities
• Competitive issues
• Revenue/profitability trends
• Near-term goals
• Strategic goals
• Overall account assessment.

The goal of putting this into a strategic plan is to develop a broader view of what is working and not working in the account and to better align the account with organizational goals. It can be tempting to put one-line answers to this list; however, the end goal is to drive critical thinking in each of these areas.

For example, the core outsourcing decision team usually includes more people than just the day-to-day contacts working with a program manager. Understanding who those people are and developing relationships at higher levels of the customer can be the difference between accounts that grow and accounts that simply get the business that other competitors don’t want. Having relationships across the entire team is also beneficial when a team member leaves.

The next several points look at account dynamics. What level of product is being built? Is the business growing or shrinking? What does the customer most value about the relationship? Are there smaller points of value that also appeal to the customer? Once those elements are understood, can they be built upon to improve the value delivered to the customer?

Sometimes service enhancement simply means doing a better job on the basics. If an EMS provider has invested in better technology or enhanced operational efficiency, however, the service enhancement opportunity might be based on more effectively leveraging those investments to provide the customer with improved service, quality or scheduling flexibility. The pace of technological change is outpacing operational improvement, making it harder to leverage the increased ability to automate tasks. Doing a once-a-year sanity check of available tools against program management processes may reduce workload when evaluating service enhancement options.

What are the growth opportunities? More of the same business or options that increase the value add, such as board-level assembly expanding into box-build, or box-build expanding into fulfillment and repair depot services? Each additional level of value-add helps increase customer stickiness. Can the customer’s core team provide introductions to other divisions? Intercompany referrals are often easier to win because they carry the added credibility of an existing business relationship. Often, these types of growth opportunities go untapped because the questions needed to gauge likelihood never get asked. Creating a list of potential growth opportunities is the first step toward setting goals to explore opportunities beyond the business already coming in.

Competitive issues are another area for improvement. Years ago, an EMS provider I worked for had a customer whose demand was dropping. We shared the business with a competitor that, according to the customer, did not perform as well as our company. The program manager asked why the business kept dropping. The customer told us its overall demand was below forecast, and our competitor was imposing penalties for being below forecast, so it was moving business to the competitor to avoid the penalty. We instituted penalties, and the business moved back because our quality and delivery were better. While not a sterling example of customer service, it illustrates the importance of understanding the competitive playing field.

The account goal-setting bullets are also beneficial. Hectic environments often foster a firefighting mentality that doesn’t prioritize metric improvement. Setting goals for revenue and profitability sets the stage for improvement of those metrics. Mapping out long- and short-term goals to achieve desired account outcomes also sets a clock ticking on the improvements needed in the account.

Finally, the overall assessment of the account is important as well. Does the account still align with business model goals, or is it a legacy account that likely would not be booked today? If there is no good answer to that question, what account behavior would reinforce the value of keeping it, or serve as the triggering event to begin disengagement? Understanding those factors makes it easier to determine when accounts are no longer a good fit for the business. The old EMS adage that 20% of customers cause 80% of problems is not wrong.

Having a clear understanding of account dynamics helps determine where resources are best allocated and opens the door to business growth opportunities that may otherwise go unexplored. While developing the initial plan may be time-consuming, it can be kept up to date with short quarterly reviews. Developing this discipline helps grow a business that aligns with internal business model goals.

Susan Mucha is president of Powell-Mucha Consulting Inc. (powell-muchaconsulting.com), a consulting firm providing strategic planning, training and market positioning support to EMS companies and author of Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Services. She can be reached at smucha@powell-muchaconsulting.com.

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