Marketing Examples of the Alignment Strategy

The following are examples that will help you crystallize the concept further and enable you to determine how this strategy can be initiated with selected major customers or target accounts. Some of these real-life examples are mandated by a corporate strategy, while others are driven by individual salespeople who recognize opportunities and then shape their offering to capitalize on them.

1) Consumer packaged goods; a grocery products company sells its accounts on a "category-management" concept whereby it assists in managing an entire category for a retail chain. For example, a toothpaste manufacturer manages the entire category of health and beauty aids, making decisions and recommendations regarding space allocations, inventory, product distribution-all indicators of profit.

2) Temporary personnel services: A temporary personnel organization has carved out alignments with major accounts to set up shop inside the account. With a full-time manager operating from within the company, it manages the entire temp function. The manager provides all services for the acquisition and ongoing use of temporary employees in accordance with the company's needs, including selection, training, supervision, and testing. In addition, the in-house temp manager fills orders from competitors' temp inventory.

3) Computer data systems: One company specifically builds and operates its clients' corporate data management centers. This requires equipment and personnel.

4) Training services: One training company has empowered its salespeople to form alliances, wherever possible, with major accounts. In conducive situations, the salesperson will take the initiative to propose that the client outsource its total training facility or a segment of it. Once the partnership is established, the vendor manages the training, using its own products and selecting competitive products to shape its total curriculum.

5) Printing: A printing vendor puts together a proposal to handle all of an account's printing needs. It has expanded its alignment to include supplying binders (which it purchases from a binder manufacturer) as well as collating, warehousing, and fulfillment of orders.

As you can see from these examples, alignments come in different shapes and sizes and potentially can, under the right conditions, be employed in most industries. However, there are certain common denominators for most of these alignment situations.

Business consultant and partner/ally are considered the highest levels of alignment because your organization and the account organization align and operate closely in a particular function or category of its business. You and your organization help or actually manage a piece of the account's business, a portion of its business where your organization has a particular expertise. In doing so, you provide bottom line value that it cannot achieve without you.

In both levels, you are considered to be an integral part of the account's operation, just as its own marketing, finance, or sales divisions are. In many cases, you not only both align with the account and manage a portion of its business, but you also manage your competitors' business in the account, as well. So your mix of products and services may be composed of your own as well as your competitors'.

This calls for great expertise on your part, a high level of commitment from the sales organization's management, a strategic corporate decision to move in this direction, and a significant investment in resources that you provide to the account. Often, the partner/ally relationship involves the account's outsourcing entire functions or departments.

This case study gives you a simplified snapshot of the complex inner workings of an alignment of this scope. Such a transaction takes significant time, many sales calls, in-depth planning, and much creativity.
If you assess the critical events that make this scenario possible, these are the important ones that should jump out at you:

Working together, you and the customer as a team know more about a particular function of the customer's business than either of you would independently. This means your expertise and the customer's complement each other.

You can make more of a profit contribution to the customer's operation than if the customer or one of your competitors ran it alone. This means you make a unique contribution the customer can't get elsewhere.

You can integrate the component parts, operations, and systems of the customer's business so they run seamlessly. This means you are a fully integrated element of the business operation.

You can show bottom line value in enhancing the account's revenues and/or reducing costs. If you cannot, you will not be a partner because there will be no reason for you to have to manage, or help manage, the operation.

The customer's culture and goals must be conducive to these kinds of business arrangements. It takes a great deal of trust and faith to allow someone else to run part of your business. It also requires a willingness to share costs, risks, and resources.

There must be a compelling reason for the account to partner with you. Ordinarily, the compelling reason is a combination of many of the requirements we just covered.

Source: Closing the Deal by Leigh Grossman