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ABB AND CATERPILLAR :KEY ACCOUNT MANAGEMENT

Submitted by:

Group - 4

Mukesh Meena

Manik Kansal

Satyajit Mohanty

Aman Singh Gotra

Akasheep Singh

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Introduction

ABB• Swiss- Swedish engineering group,• World leader in power & automation technologies• Supplying utility and industry customers with product &

service.• Five business division:

• Process automation product portals- (Turbocharger)• Power product division.• Power system division.• Automation product division.• Robotics division

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Cont..

CATERPILLAR• World’s leading manufacturer of construction & mining equipment, diesel

& natural gas engine & natural gas turbines• Two Plants Lafayette, Indiana Kiel, Germany• Cater pillar had three segments: Machinery.� Engine.� Financial product.� `Sales & Revenue - $36.3 billion

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Buyer Supplier Relationship Between ABB & CAT

• ABB earned US$ 67 million in revenue from Caterpillar (turbochargers supplies)

• Supplies of turbochargers were from best run and most efficient plants owned by ABB

• Caterpillar among top 3 customers of turbo systems amounting to 30 % of sales

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KEY ISSUES

• In 2004 Business between caterpillar and ABB was on the verge of closure

Reason - Big disconnect between management and customer Caterpillar not satisfied with ABB’s delivery support ABB’s unwillingness to compromise on deliveries and price Conflicts in services approaches and issues of Intellectual property

rights as Caterpillar had own manufacturing facility for turbo designs

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Key Account Management Strategy

Understand Customer

Needs

Products and services portfolio

Support and Services

Customer Value Creation

Exceed Expectations

Help Them grow sales and

income

Be a partner not just a supplier

Need Assessment

Skills and capability development Delivery of solutions

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Key Account Management

Analyze Account

Set Account Objectives

Plan Account Strategy

Take Planned Action

Review AccountTie account team’s

incentives with customer metrics

• Tie account team’s incentives with customer metrics

• Monitor performance against tactical plan

• Hold account team members accountable

• Include Caterpillar in account planning process

• Develop both internal and customer targets

• Tie actions to improvement opportunities

• Understand account requirements and capabilities

• Plan action to fix problems

• Target account goals

Rank account on improvement potential index

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Recommendations

• ABB can improve knowledge of account team about CAT’s business for cross-company team building

• Steering committee can ensure governance and coordination between teams across both the organizations

• Whole team, and not just the key account manager’s commitment is required in building relationships with the client and become more customer-centric

• Caterpillar needs to understand how ABB operates to improve existing relationship and find new opportunities to add value

• Change in ABB’s position from a supplier to a partner can provide needed technical synergies and offer win/win opportunities to both of them

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