Globalization of the world economy has caused new forms of competition. Companies are faced with a new and fast-changing environment, so that international companies need to find new ways for succeeding in the battle for
customers. Like suppliers, customers are also affected by sharper competition. They are forced to introduce new products and services, acquire latest technological developments and at the same time cut costs. One of the trends noticed amongst large international customers has been the narrowing of the supplier base, and search for the development of new types of relationships
with the selected ones. As a result of these trends, suppliers are under additional pressures, operating
under squeezed profit margins and higher customer demands. Traditional industrial products due to the technological development are becoming increasingly commoditized, and a shift in the measurement of value has
occurred. Standardized features like quality, design, durability and ability to deliver all this at a reasonable price, while still being regarded as important,
have remained only as the base for the creation and delivery of total service solutions, the so called `total package'. This marks a significant move towards the so called `soft' part of the offer,
including services complementing the product offer in terms of creating and delivering `added value' to customers. Service, maintenance, renting and leasing of equipment, new sorts of financial solutions, information and
consulting services are completely or partly being included in the offer. The Key Account Management concept has become a mode and tool for serving large customers on a global basis aiming towards achievement of longterm
business success, developing and sustaining suppliers competitive advantage. It is defined as an organizational form and process in multinational companies by which the worldwide activities for serving multinational customers are co-coordinated centrally by one person or team within the supplying company.
In the light of this, our case company, Volvo Construction Equipment has proposed a Master's Thesis project with the purpose of identifying and accessing the key elements for development and implementation of the KAM
concept as a tool for the creation and increase of sustainable competitive advantage.
This research has been conducted from several different perspectives: academics, consultants and the case company. Theories upon which the thesis is based are: network strategy as a part of interaction approach to industrial
marketing, relationship marketing and organizational buying behavior theory. The empirical part of the thesis, and conclusions drawn from its analysis, are
based on numerous interviews, seventeen in all, with both high-level and operational managers in selling and purchasing organizations. The empirical results, and the conclusions based on their analysis, have two
dimensions. One is concerned with the general findings about the KAM development and implementation based on the information obtained through many interviews with the case and other companies. Analysis of the customers'
purchasing processes and their views on KAM are also included and presented in this part. The second dimension presents the specific findings connected
with Volvo CE but in a ma...
