Four Who Know How

Since its founding in 1987, Peoplesoft Inc. has organized its operations around customers. Not products. Not sales. Customers. The developer of enterprise-wide application software is on target to bring in $1 billion next year. To get there, it's relying on more than 300 account managers -- employees within PeopleSoft's customer service and development division -- to put the customer's interests first.

The account manager is a customer's primary point of contact, acting as a liaison between the customer and the company's other divisions. Unlike account managers in many organizations, however, those at PeopleSoft are not commissioned sales staff. Instead, their performance rating is based on how easy it is for customers to implement PeopleSoft's software and on whether customers remain happy.

The stakes are high: PeopleSoft's average software sale is $1 million. Its clients include such giants as Ford, Dow Chemical, Siemens, Wal-Mart, and PepsiCo -- so far, they're all smiles. In PeopleSoft's 1997 customer community survey, customer retention and satisfaction consistently push 100%.

"The account manager is really our differentiator," says Sebastian Grady, vice president of customer services. "It's the glue that holds PeopleSoft and the customer together." Grady joined Pleasanton, California-based PeopleSoft in 1993 as an account manager and now manages customer services for the company. Fast Company talked with him about the role of account managers, their relationships with client companies, and how they increase customer loyalty.

The account manager focuses on two things: helping customers get up and running with PeopleSoft products so they can see a quick return on their investment, and making sure that we've got referenceable customers -- happy customers.

Account managers aren't paid for selling additional products to their accounts. Their only job is to make sure the customer is completely happy with the product after it's bought.

Each account manager handles anywhere from 1 to 10 customers; the average is probably somewhere around 6. One customer would be too few -- you'd lose the chance to leverage one customer's experience into another's. But 60 accounts would turn account managers into purely administrative people. The idea is that an account manager in the health care industry has 5 or 6 accounts -- mostly hospitals or medical centers -- and can become an expert in that industry.

Our customers know that any time they've got an issue that's not getting handled in another part of PeopleSoft, their account manager can help them cut through the red tape. Around here the account manager is like E.F. Hutton in that old ad: when the account manager speaks, people listen.

The account managers are on the hook to make the customer successful. They know the customer's business. They're a powerful reality check for the rest of the company. They can call foul when we're doing something we shouldn't be doing, and because they're out in the trenches with the customer every day, they can tell us what is and what isn't going to work.

The account manager and the contact person inside the customer company are extremely close -- like Siamese twins. They count on each other. If the customer doesn't call the account manager, the account manager calls the customer -- whether or not there's a reason to call. Customers get so dependent on their account manager that when one gets promoted or moves on, we have to make sure there's a smooth transition. It's up to the old account manager to introduce the new one.

Customers get so comfortable with these people that they think they're part of their company. And the account managers are such customer advocates inside PeopleSoft that sometimes we wonder which company they really work for.

In our latest implementation report, we asked our customers, "Would you select PeopleSoft again?" The answers are amazing: 99.6% of those using our human resources management systems, 98.6% of those using our financial systems, and 100% of those using our distribution systems all said they'd choose us again. Survey professionals tell us that a response between 85% and 90% would represent maximum customer loyalty. Account managers are the biggest reason our customer loyalty is so high.