Global account management (GAM) is the concept of managing global accounts. It is a method that businesspersons employ to build and maintain long-term relationships with customers around the globe. It is very important for businesses to pay attention to, as it plays a big role in their success.
What Is Global Account Management (GAM)?
GAM is an extension of national account management, wherein experts are assigned to oversee country-wide customer accounts for a business. The early adopters of GAM were primarily global technology companies such as IBM, Xerox, and Hewlett-Packard. It happened because clients demanded that the IT services provided to all their locations meet the same standard.
GAM has since been adopted by many other businesses, and this article will dive deep into what it entails, its challenges, and its advantages and disadvantages.
Characteristics of Global Account Management (GAM)
- Global Account Managers: Experts must be assigned to the role of managing global accounts. These experts liaison with clients and are responsible for fielding any complaints and providing solutions to keep them happy.
- International Customer Base: Of course, you must have customers in multiple countries around the globe if you want to adopt GAM.
- Uniform Terms of Trade: The terms of trade should be the same for every customer regardless of their location. Otherwise, you can expect complaints of unfairness and treating one location better than another.
- Standardized Products: Your products and services must be standardized for clients across all locations.
- High Service Quality: You must try your best to offer high-quality services to all clients.
- Strong Support Network: You need a strong support team that identifies new opportunities, makes plans for customer accounts, manages communication with customers, etc.
Global Account Management (GAM) Approaches
The three main approaches are:
- Coordinated: Here, the GAM unit is not too powerful, and the national operations team retains more power. This is the ideal approach when local relationships are more important to businesses than providing standardized services for multinational customers. Banks tend to use this approach, and so do suppliers who lack the capabilities to manage transnational clients centrally.
- Control: In this case, the responsibility for managing global accounts is split between the national operations team and the assigned GAM group still, most of the power lies in the hands of the latter. It is the most common approach applied when customers require a global account but still need to retain an account with the national operations team.
- Separate: Here, the company creates a separate business unit whose role is to manage transnational accounts. This approach is adopted when the clients are profitable enough to pay the extra costs that come with having a dedicated GAM team.
Challenges in Global Account Management
Some of the major challenges include:
- Global account teams have to find resources in different countries to offer a standardized service, even if the accounts in some countries do not bring as much revenue as others.
- Coordinating customer support resources with both local and international clients can be tough due to time differences, communication gaps, different modes of operation, etc.
- Cultural and corporate differences across different countries can cause conflict in managing accounts.
- Your staff must find the right people to network and engage with to get things done across different countries.
- Political unrest in some countries can impact business activities, although the chance of this happening is usually small.
- Physical locations and time zones make face-to-face meetings difficult, even when such meetings are essential to managing customer relationships.
Advantages and Disadvantages of GAM
- It provides a good multinational market overview for companies and helps them set a fair price for customers.
- You can apply the same process to manage all clients around the globe, which makes doing business easier.
- Businesses can get a better understanding of customer specifications, requirements, and needs.
- It keeps the company in good standing with global customers. For instance, if a multinational customer gets a good experience in one country, they will likely want to adopt your company’s services in other locations. In other words, it maximizes a company’s chances of selling to all or most of a key customer’s locations.
- It can help customers achieve consistency in selecting your products and services, which, in turn, reduces training and support costs.
- You may incur higher costs when managing global accounts, given you have to cater to the distinct requirements of customers in different countries.
- Some companies get confused about when and how they should adopt GAM. Sometimes, they may offer it to the wrong customers or adopt the wrong approach for the right customers.
We have explained in detail what GAM is, its characteristics, challenges, and pros and cons. This information will help you decide if adopting GAM is the right strategy for your business.
One of the key tenets of adopting GAM is to have a banking platform that enables you to transact with customers across the globe. Silverbird is a good example of such a digital banking platform, as it lets you send and receive payments in over 30 currencies.