Customer Success

State of Customer Success 2018

I attended Pulse Europe (the 4th) on the 8-9th November, an event run by Gainsight, a Customer Success (CS) technology vendor. They run the larger, main event in the US and I had the pleasure of attending last year where I captured the State of Customer Success 2017. So this is a timely update with a local, regional flavour.

Below are some general observations, main takeaways and then I captured notes from the sessions I attended (including my spin on things).

Chatting to the GM of the European office of Gainsight, Dan Steinman, I concluded that not only were Gainsight in the CS technology business but also in education. He agreed.

By that we didn’t mean the services part of Gainsight where they do offer education in support of their technology (see Gainsight University). I mean the education of an industry, a nascent one that needs it. It’s in their interest of course, to grow the category and also the industry within which it operates, mostly Enterprise Software [as a Service]. 

We also discussed how other industries could benefit from learning about the CS business, like car manufactures which I have written about before: The connected car vision is missing a few connections

I digress, the point is Gainsight take a leading role in informal education and for helping grow and share learning between individuals, companies, for the category and beyond. In this respect they are very successful and the event achieved that aim too.

Main take aways:

1. Tighter integration between product and CS, the move to self service and broader alignment

This was a theme driven not just by Gainsight on the back of their acquisition of Aptrinsic (more here). I’ve been seeing this more and more and driving it in my work and it is definitely a growing trend.

It encompasses two elements:
(1) greater collaboration between product and CS teams on high touch interactions with and insights from customers and,
(2) the built in onboarding, help and product adoption features in products that drive end user self service.

This trend is possibly the most evident but there is also the need, oft talked about, of greater alignment within customer service oriented teams and with sales and marketing teams.

2. Lack of innovation

I found at this event and on the whole that there are no real innovations being driven or presented other than in company products themselves (point above). I am writing an eBook / trend report about this and in the work I do mentoring startups and it is a main pillar I stress.

I think in an industry or category often struggling to find its way (see next point) we will have to do more to innovate and increase the impact of customer success activities. There is so much scope since the customer is at the forefront of everything and technology is changing so much and so fast. But innovation needs to come to business models, processes and people too.

3. Hype Cycle

The chart below was presented by Nick Mehta, CEO of Gainsight in one of his keynotes. Billed as a maturity chart, you could also easily see this as a hype cycle. I’ve been through the early curve twice in companies and seen it happen in others. I’ve also seen it happen with many technologies which the cycle most often refers to. I got an impression that as an industry we are in a trough of disillusionment.

Perhaps I’ve been in CS too long and lack the starry eyed optimism of a newbie but I’m saying this from the perspective of what I hear. I hear too much justification, disagreement on the function and its impact, arguments on who owns the customer, fights with other disciplines like customer experience, etc.

It just feels like the conversations are typically of the kind you find in the trough of disillusionment. It’s also a period characterised by lack of innovation as mentioned. That’s not  a bad thing. If I’m right, I’m looking forward to the slope of enlightenment for the industry as a whole because on this, I’m a true believer 🦄 🚀

Day 1 – 8 November ’18

Keynote – CS trends

This is a list that Nick Mehta, CEO of Gainsight ran through:

  1. CS drives sales. Prospects talk to customers and advocacy is key. So if you ensure customers are successful, they will act as willing reference points and that will help close deals. I totally agree with this and think it’s an undervalued KPI (from the vendor point of view).
  2. Company-wide priority. Top down involvement, endorsement and integration into operations is critical for CS success. Having been  a part of two reorganisations because this was not done right from the start, I absolutely concur. Where CS fits is still being debated though and the dust has yet to settle on that. More on this later.
  3. Career success. CS is one of the twenty most promising jobs of 2018. Growth in Chief Customer Officer’s was talked about and the fact they are primed to be the next CEO’s with some early examples quoted.
  4. Prescriptive. There’s a greater drive to commonality, standardisation and bench-marking. The periodic table by Gainsight below is an attempt to define this. With this lacking in many of the organisations I’ve worked in and with, it’s going to be a challenge to define for an industry but I agree it’s critically needed.
  5. CS movement. The growing attendance at Pulse conferences and book sales was pointed to as evidence of a growing CS movement. A little self serving perhaps but I can definitely feel an uptick in tempo over the years. The jobs market is also an obvious indicator and aside from CS being a most promising job, the number of openings I’m seeing is rising almost exponentially.
Periodic Table of Customer Success Elements – by Gainsight

CS in EU

  • Pockets of activity mentioned like London, Berlin, etc. For me they echo the startup centres in EU where often the bigger, better SaaS companies reside and thus CS naturally follows.
  • EU is learning and following fast and a couple of stand out companies were quoted as evidence of that – see next point (in brackets is what they are excelling in):
  • Slido (Voice of Customer); Intelliflo (ROI); ReviewPro (tech touch + human, e.g. 3 mails following sign up – if no open, human contacts); Signavio (customer health); Attraqt (exec alignment/sponsorship – internal); Response Tap (success planning); Workfront (risk management); Gainsight (stakeholder alignment – external).

CS and Product

This was presented by Travis Kaufman, VP Product Growth, Aptrinsic on the back of Gainsight’s acquisition of Aptrinsic. Ultimately its a reflection of the strategic direction Gainsight believes they need to take to grow the market and no doubt themselves. There are some compelling arguements.

  • Sales and Marketing have done it (quotes about Salesforce’s acquisition and integration of several marketing platforms into their offering), now CS and product need to. Hardly compelling evidence but some other drivers were mentioned which do make sense.
  • Driven by
    — Data. Drive new opportunities based on usage data.
    — Scale onboarding by extending the journey into the app.
    — Influence product roadmap based on data not opinions
  • Product is way to scale CS engagement for high volume, low touch accounts. I’ve written about this multiple times here and here.
  • Feature / user feedback built into the product and covering onboarding as well as ongoing use will expand.
  • Sales and marketing consolidation will be followed in the CS / product world is the firm prediction – I’m rooting for this outcome.

Accenture analysis

A talk on why CS is the new growth mantra which is based on the main C-Suite challenge around delivering profitable growth. 500 executives were surveyed for the insights amongst 10 brands: Microsoft Azure/O365, Tableau, Symantec, Adobe, Salesforce, SAP, Cisco, Workday, Dell-EMC, Marketo.

  • A customer’s level of trust in a brand is the single most important 
    factor in a renewal decision (55% said so). Trust is the #1 influencer and counts no matter how long a customer has been buying a product or service. 
  • First impressions count – deployment (installation, activation and setup) is the most important CS activity. It is 2 times more significant in determining whether a customer will renew. A bit of confusion on their part here. As pointed out in various other presentations over the two days, I would separate out CS management from deployment activities and for me its much more about how you launch to end users: Launch like a boss – bringing consumer startup practice to your enterprise technology platform.
  • Longer term customers value access to self service tools and the ease of renewal – 73% think its important and it can have a 20% influence on renewal decisions. I love this since it validates a lot of my thinking: Role of Self Service in Customer Success.

Must win moments for a CS team

By the author of The Three Value Conversations: How to Create, Elevate, and Capture Customer Value at Every Stage of the Long-Lead Sale. This presentation was about a messaging approach for customer renewals, price increases and upsells. It was part based on a quote referenced by Nick Mehta (see screenshot) that renewals are really resells. It also emphasised the need to tell a better story. Great example of Malcom Gladwell’s Tipping Point book success – he wasn’t the originator of the theory, Morton Grodzins was. But Gladwell popularised the theory through better story telling. Other points:

  • Selling (acquisition) stories need to be different to staying (retention) stories because the latter reinforces preference stability as opposed to disrupting change / status quo bias.
  • At point of renewal, there is no sense selling on new features/functions which many sales people do, but rather on reinforcement.
  • Some really good scientific and evidence based reasoning (neuro science, behavioural economics, social psychology and decision science) on why good storytelling works. Totally get this having done several sessions on storytelling before – key CS skill I would say.
  • Focused around the customer retention path post sales (why stay), but also answering questions around why the customer should pay more and evolve (expand)
Customer Deciding Journey

Success Planning

ResponseTap and Micro Focus went through some of their common approaches.

  • No common view of desired customer outcomes between sales, deployment, onboarding, etc.
  • Single source of truth needed – one document
  • 3 time lines created for a plan (short, medium, long)
  • Everyone agrees on common outcomes before plan is approved – sales, CS, support, etc,
  • Benefits/Learning:
    — Having a common customer journey between departments
    — Tracking NPS at different stages is useful and should cover various journey phases: sales, onboarding, then service/support and CSM
    — CS should review internally feeding progress back to the organisation
    — Improved cross team collaboration and decision making
    — Better renewal rates after implementing

Self Service

This applies mostly to the support function and was presented by someone from Insided.

  • Most customers don’t want to contact companies for support (72%, Forrester) so important to address well from a self service point of view.
  • Free trials and freemium customers also need support
  • Automation is not the answer for everything. 7 out of 10 interactions with chat bots fail.
  • Including community responses in help centre search responses is good practice – Google quoted as example.
  • Peer to peer answers are viewed as more trustworthy. Best is for the company to focus on company and FAQ material and the community, the long tail of other queries. Coincidentally I just came across another research based post that bears this out: Why Online Communities Are The New B2B Superpower
    — From the post: online communities are the third most common digital engagement channel for post-purchase customer feedback or support (after email and website).
  • Support or help in product is best and voice queries are rising (digital assistants).

Scaling user onboarding but keeping a personal touch

Again this was presented by Travis Kaufman, VP Product Growth, Aptrinsic. I agree with this approach from a scale, tech touch point of view. The only problem I see with it is the potential over emphasis on features. This can be a distraction from the all important emphasis on business outcomes which should never be forgotten.

  • Most of the user experience happens within the product and so it’s a good reason to focus on this which I totally agree with.
  • Onboard users to aha moments – key features you want to emphasise.
  • Onboard to new features as they release
  • Re-engage users to complete critical tasks
  • Product teams need to know what feature adoption rates are and also what the qualitative feedback behind that use is. Work with CSM’s to leverage this and drive or accentuate further use. 
  • Derive personas for specific use cases. Ask in qualitative surveys or deduce from the use of a feature and who you intended it for.

The quest to be LAER efficient

From the President and CEO of TSIA (Technology Services Industry Association) J.B. Wood, a great overview of the industry as a whole. Also touching on the broader opportunity with XaaS (Everything as a Service). The TSIA is an association that works with the top 400 tech companies to understand what they are doing and what impact that has.

  • LAER: Land Adopt Expand Renew. Where XaaS meets profitability – see operating framework in slide below.
  • 5 key markers on the path to LAIR effectiveness which is comprised of 4 stages – see this also in slides below
  • Monetisation of CS falls in the effective phase. Allows for investment in better CS activities
  • Point made that Cost of Sales and Marketing (COSM) is too high in cloud companies because customer acquisition costs (CAC), customer expansion costs (CEC) and customer retention costs (CRC) are based on activities being driven by traditional sales and marketing teams.
  • If the CS org were to manage activities covering the latter two it would drive down COSM. Fair point and this lead to a lot of discussion around the CS org owning renewals, upsells and expansions – the standard discussion that always comes up and was covered in other talks/discussions. On this topic I feel like the verdict is still out even after years of discussion. See also Nick Mehta’s point on this from his keynote on Day 2.

CEO’s view of CS

A panel discussion between CEO’s of Futrli, Precursive and TaskRay facilitated by the CCO of Box, Jon Herstein. All had robust CS functions so naturally the input was mostly positive.

  • What can you do to make CS successful? Spend time with the team. Understand the problems customers and CS org experiences. Get quantitative/qualitative feedback on ideal CS function then build it. Get people to think like customers – spend time there.
  • How to avoid silo’d CS function and ensure cross company accountability? Success hacks across functions. Have hypothesis that will achieve CS outcome then try prove. Non traditional customer facing roles spending time with customers, e.g. engineers. Love the hacking idea – I’ve written about this before: Success Hacking
  • Where will you invest? Automation of tasks so CS can focus on value work. Love it – say no more.
  • Any questions from VC’s around CS? A resounding YES around what is being done and how. They want insights into CS like scope of effort, ration of CS individual to customers, on what, etc.

Day 2 – 9 November ’18

Keynote, Nick Mehta, CEO Gainsight

Rumination on the raison d’etre of the CS org and where and how in the organisation it works best based on Gainsight experience. All makes total sense and as it should be for now.

  • Started on the debate over CS being a role or strategy. If not solved there’s a danger we lose the initiative. It should and can be both.
  • The CS charter: CS (Customer Success) = CX (Customer Experience) + CO (Customer Outcomes). CS > CSM (Customer Success Manager), in other words, Customer Success encompasses CSM’s and many other areas besides.
  • Lessons from Gainsight:
    CS and Renewals separated at Gainsight. Different skills and tasks and difficult to do both well.
    CS and Account Management also separated. Expansion happens off the back of adoption, outcomes and different audience relationships that CS build.
    CS and Services. Handover opportunities and knowledge for skilled teams from CS to Services to implement deep work and methodology (project management).
    CS and Marketing. Building the right outcomes and thus advocates happens in CS, formal references and stories developed further by marketing.
    CS and Support. Strategic, exec stakeholder and impact work is for CS. Technical skills, process and speedy results should be covered by Support.
    CS and Product. They have so much common ground: adoption breadth and depth; customer feedback, etc. Too often they have different ways to measure and silo’d thinking. Again example of sales and marketing and need to combine CS and Product which Gainsight are doing.
    Exec team and CS. CS provides insights to customers, execs can amplify, drive resources, decisions and problem solving, etc.

Sirius Decisions: B2B alignment and impact on business performance

Sirius Decision are a research and advisory company focused on demand generation and performance measurement. They presented findings from various bits of research.

  • B2B Revenue Engine expectations have been increasing, challenging organisations to drive stronger alignment across customer success, sales, marketing and product teams.
  • The historical view of alignment predominantly around the buyer is no longer sufficient to drive growth and profitability rates ahead of the market and the competition.
  • Customer engagement is one of the six critical areas of alignment that B2B revenue leaders must focus on.
  • Achieving and maintaining alignment within customer engagement initiatives requires a roadmap to realise the business impact it can deliver to the organisation.
  • Engagement scoring (for all the various customer interactions) highly sought after by CMO’s

Customer Success at Cisco

Alistair Wildman, Head of customer experience EMEA was interviewed on stage. This is what he shared after being there and in his position for 6 months.

  • They call it customer experience which includes CS. Covers other functions: support, service, etc. So it’s the whole post sales experience.
  • Hardware has been wrapped up into services subscriptions model
  • 80% of post sales efforts happen through partners – they are key in strategy. Not like Microsoft apparently although not true. Good analogy of a pit stop, one tyre is changed by Cisco, the other three by partners.
  • They have account based CS which is a direct engagement model and technical CS which will work with partners on customer challenges.
  • Data is key. They are still in the process of building dashboards to understand usage which they think will take 2-3 years.
  • Lessons from Salesforce (where Alistair worked previously): Hire for skill not for count. Senior people that know how to do the job. Develop skills through customer engagement simulations with product for training.

Data science at Gainsight

I attended this session thinking I was going to get insights into the cutting edge practices adopted by Gainsight but it was more like a basic intro to data science. Here are my brief notes before I left the session.

  • We are heading into the age of predictability which is where we want to be – anticipating trends, heading off negative ones, leveraging positive ones. 
  • Tasks to consider are: identify the nature of your data sources; quantify and get a score for your data outputs, understand and plot maturity stages, move up the scale.
  • Prescriptive analytics understands causes for outcomes and prescribes solutions upfront. Needs AB testing of playbooks. This is the kind of deep level insight I was hoping for but we merely skimmed the surface.

How do VCs see CS

Joyce Liu (Dawn Capital), Paul Morrisey (Battery Ventures) and Stephen Millard (Notion Capital) were interviewed by Igor Beckerman (CFO Gainsight).

  • Usage and adoption is a clear priority early on. Value comes later. Customer advocates seen as important and so too Customer Advisory Board’s (CAB).
  • Metrics in the boardroom. Predictability and causality key. What are targets likely to be and why are they what they are.
  • How much to spend on CS. Depends on whether the company has big end customer’s vs small end customer’s. Onboarding should be a big investment. Where early value is seen with correlation on outcomes, investment goes up. CS can be a cost centre in the early days but profitability is important later.
  • CS leaders. Some of the best were waiters in the past – they all have a love for service. For larger companies, those that can have quality conversations across a broad range (multi functional). Systems thinkers and those that can take multiple perspectives (customer, industry, vendor)
  • CCO to CEO. If former responsible for 90% of long term profit that stands to reason it will happen.
  • Decision factors for investment. Talking to customers to get their views on the company. Tools and processes in place are also a key decision factor.

Bonus

Brain Cox came and spoke on astronomy and the result was 🤯 Some excellent perspective after two days of intense CS overloading.

Sense Making

An explorers guide to the new era of work

The explorer

There’s a long list of traits prevalent in the explorer, people that are naturally inclined to overcoming challenges and seeking new discoveries in any field, place or time. Those traits that stand out for me are the joy of mastering new skills or knowledge, an insatiable desire for uncovering truth and new things and stoic perseverance.

No matter how you define it, you sense whether you have it from an early age. I remember as a little boy, wondering the savannas of Southern Africa where I grew up, feeling like Livingstone even though I was only in open fields (veld as its called) immediately surrounding my home. In the early days few houses had been built where I lived and it was more savanna than suburb.

And far from new lands, wild animals and indigenous peoples it was ants nests, puddles with tadpoles spawning, old ruins and early constructions of the new house being built in the twilight hours, after the builders had left for the day, that I was exploring.

I spent hours there. In the holidays it stretched into days.

The joy and thrill I felt has never left me and I know I am not alone in this feeling.

It has guided me in everything I have done since. Leaving the country of my birth to explore London with my new wife a month after we married. A changed career from advertising to technology supported by new studies there. Again leaving for new lands, this time The Netherlands, for new work opportunities and to build a family, three wonderful children all born there. Then after 7 years, back to the UK starting my own business which I ran successfully for a similar time period. Since then it has been forging new paths in customer success management, in itself a new career type.

Being an explorer is part nature part nurture. From a work point of view, my experiences transcended into making me an accidental intrapreneur.

I’m not sure we (as workers) have a choice any more.

I remember reading an article back in 2013 by John Hagel, John Seely Brown, Tamara Samoylova called Unlocking the passion of the Explorer.

It resonated powerfully with me. It captured the essence of what I was and how I approached things. I’m an explorer. I’m passionate.

It captured beautifully the era we live in and the shift we are undergoing, especially in the world of business.

In my mind, the shift refers to the transition between the industrial era into the one we are now in, the digital era.

The Digital Era

Digital explorers have advantages over our industrial era forebears. In the digital era, things can be measured more easily (response and feedback loops are immediate and traceable). It’s all manifested through data. Insights are the outcomes you achieve once you have sifted the data tea leaves. The digital world is more open to more people and experimentation is rife. Experience is more malleable and accessible to more people.

Digital explorers can learn more quickly by doing. They create meaning as they experience. They are data driven and entrepreneurial. They learn from and are driven by others like them who share their learning openly.

Oh what a joy to be a digital explorer 🚀

I put this daneldoodle together to characterise some of the different traits I think are important. Other than the traits needed, whatever you think they may be, the one other factor that you need to consider is speed and agility.

So get cracking fast or face extinction. Being a digital explorer has to be a given in today’s business world if you want to be successful.

And build the capabilities of the explorer that will allow you to discover your place in the next era.

The Next Era

As the industrial era ended, so too will the digital era.

We are well into the digital era and feeling the early impact of the next era.

The next era will be characterised by intelligence, automation and creativity.

The intelligence will be artificial. The automation will be machine led.

The creativity will be human led.

Explorers of all era’s but even more so in future, will have to rely on their imagination, their passion, their humanity and most importantly, their creativity. Things machines are not great at.

I’ve written more about that here: The post robotic AI age and the role of creativity and innovation

Customer Success

SaaS beyond Software – Automakers

customer success

The auto industry needs Customer Success managers. Geoffrey Moore, famed author of Crossing the Chasm and father of Moore’s law is writing a new book on Customer Success. This slide above comes from a talk where he is quoted applying the concept of customer success to manufacturing. I applied the same thinking in this blog post a while ago to a specific type of manufacturer – the automaker: The connected car vision is missing a few connections.

Be more SaaS

 

Customer Success, Startup Innovation

Agile in nature not just by name

Satya Nadella (CEO of Microsoft where I work) recently shared his thoughts on how organisations need to embrace “tech intensity” to innovate and grow in today’s high-intensity digital economy.

He didn’t specifically call out speed but its implicit in everything he said.

I’m surrounded in the work I do at Microsoft, by IT teams that have embraced Agile. I’m sure Satya would agree that this would form a key part of tech intensity efforts.

Yet of all the things that Agile is, the one I find most often missing as the name would suggest, is the need for “rapid and flexible response to change”.

I’m on a mission to emphasise the need for speed in the work I do in Customer Success around technology adoption.

Here is the line I push:

I am not one to be be speeding things up just for the sake of it. As a DharmHacker I actually think stopping, slowing down and reflecting frequently is crucial for effective decision making. Mindful over Mind Full is the title of an eBook / trend report I wrote that pretty much sums up the imperative.

Speed and Innovation together make the difference

Mindful decision making does not contradict speedy actions once you have realised the need for change and decided on a course of action. And speedy action carried out with intensity is what distinguishes leaders in today’s digital landscape.

digital innovationIf you are changing at speed as a result of external pressure, you will be better off than those that are slower or not changing at all. But as Satya pointed out, innovation is a key part of tech intensity and if purposeful innovation efforts are executed at speed, then you will become a leader in your industry. If innovation needs to be the “why” and change the “how” then your “when” has to be yesterday.

In the video above and in the last post I just linked to, you should see how I’ve positioned speed and innovation efforts side by side as key differentiators of digital transformation success.

Why agile is not just a software development methodology for IT

As you may also have seen in the video above where I included a snippet by Paul Willmott (Senior Partner and Digital McKinsey Leader), they have a clear view on the importance of speed in digital transformation efforts.

As a leader in digital transformation strategy setting and execution, McKinsey also have views on the many other factors that need to be considered. Here are just a choice few of my favourite articles that they and others have recently published which elaborate:

Customer Success

Role of Sales in Customer Success and 6 rules to guide you

How many times in your role as a customer success manager working with customers, have you struggled with the solution you are trying to implement where it has not been sold right?

By solution I mean what is constituted in the solution selling process (products and services, solving problems or needs and/or delivering specific business outcomes).

By not being sold right I mean when a customer thinks they are buying and getting one thing and once the deal is done they discover it’s something else.

Sometimes this is a result of over promise to close a deal. Most often this is around what a product can or cannot do, a feature/function mis-sell.

The area I am concerned with and covering in this post is a result of ignorance of what it takes to make a customer successful with the use of a SaaS solution and where this leads to misunderstanding of the effort required or provided. Generally the lack of clarity arises in one or all of the following areas:

  • What the vendor provides as part of the service the customer pays for and what might fall outside that. With SaaS, lets be honest, the majority of the responsibility lies with the vendor to prove value and keep the subscription afloat in terms of recurring commitment. That’s why customer success teams where set up. But a customer success team is not a silver bullet. So first sales people have a responsibility to position the customer success role and effort correctly and then make sure the customer understands that it cannot all be down to the customer success manager or team.
  • What comes with the product in terms of onboarding and adoption support. In the best case scenario, your product has clear onboarding process and functionality built in that supports end users as they start using a new technology and as new features get added over time. A good vendor will also provide documentation and learning material to supplement this. A good sales person will point to this as part of the sell but that’s the easy part.
  • What the customer needs to do in terms of driving value. This is the hard part. This is where sales people often trip up. They don’t make clear to the customer that resources, effort and commitment is required on their side at all levels. Especially with complex enterprise products covering complex people oriented processes.
  • What is the end goal in terms of what business outcomes are being striven for. This includes the measures for success and how you are going to track against them and the need for doing so.

It makes implementing any solution really difficult when these expectations are not made clear up front. I have often had to get involved in “go back” motions which as the name suggests, requires going back to the customer to resell the solution right.

Click to enlarge

This is a monumental waste of both vendor and customers time. Not to speak of the messy job of clarifying misperceptions which is never a good thing.

As someone who needs to implement such solutions post sales, I am acutely aware of this so I’m sharing my experience and thoughts of what will hopefully avoid such situations.

SaaS sales are already complicated and your product has to be easier to buy than to use but use and what it takes to be successful with it, need to be a clear part of the solution you sell.

6 rules to guide you

Whether you are in sales or customer success and ideally this is done together and before anything is sold, make sure the customer knows these things:

  1. Use cases are the currency of success and should be defined as part of the sales process, not afterwards. They are part of the solution sold and a key way in which value is delivered (use cases should have clear business outcome targets and KPI’s to measure success). Getting a customer success manager to do this after the deal is done is to close the stable door after the horse has bolted.
  2. Make clear where culture change is necessary to make a technology implementation work because it requires such different work practices. Also that the customer is responsible for managing this, not the CSM. The CSM is not a resource but a guide. By definition a customer success manager cannot appreciate and know an organisations culture as well as someone who works there. Nor can they influence the change that is often necessary.
  3. Maturity and value take time and there are no quick fixes where complex organisations and technologies are concerned. Big bang approaches at launch are often necessary and the first 90 days are critical but will seldom do the job in the long run. Iterating your way forward by constantly tracking progress and tweaking where needed is best.
  4. Data is the way to track progress, it is the only way to measure success. First that the product is being used and then that intended outcomes are being achieved through a well defined set of KPI’s. This should be made up of a solid set of quantitative and qualitative data focused on product usage and then tied to business outcomes. Ideally this comes as part of the product and service but crucially, this needs attention and effort.
  5. Business outcomes are the value deliverable, not a well configured product, a great process, a changed culture, etc. The latter are the means, business outcomes are the end game. Making a product available is not automatically going to achieve desired outcomes. Return from a technology investment requires clear value definition upfront (use case definition aligned to a vision and goals that are constantly measured against and changed where needed) but you need to manage these other things to get to there.
  6. Success events are activities that will lead to usage and value creation. They are often activities that a CSM and those responsible for adoption in the organisation work on together to plan and execute. Do these and track the impact they have on usage and business outcomes constantly. This takes time and commitment and often, crucial involvement from senior executives.
As a Service, Customer Success

Why customer experience and success share the same roof

There is a fundamental premise I make in the new eBook / trend report I am working on captured in the title.

Yet I’ve taken part in debates on LinkedIn that show there are divisions in opinion. Separatist thinking even.

Some think that customer success (CS) is the new kid on the block and muscling into territory owned by the customer experience (CX) brigade.

I guess it all depends on your background. Do you come from a marketing background where CX generally hails. Or from a customer service or account management background where CS hails.

I think it’s all rather pointless. I see the two as being inextricably linked.

The mother and father of modern views of the customer. Perhaps CX is the mother because in my view, CS is born of it, so to speak.

Some distinctions might be useful at this stage. These are mine:

  • CX is the sum total of interactions a customer has with a company and the net effect this has on the customer in terms of satisfaction and loyalty.
  • CS are the outcomes a company enables a customer to achieve through the use of its products/services.

CX is made up of many touch points that often transcend those of a CS team.

For example, pre-sales activities make CS hard if a product or service has not been sold right and perceptions between vendor and customer are misaligned on what comes after the deal is done.

CS teams are not always involved pre sales, at least in the early stages.

So its important those in sales are aligned to the right customer experience view and approach. They start the customer off on the journey after all.

In my mind, the best analogy I can draw between the two is that CX is the shell of the home with all of the feelings and emotion it engenders. CS is the different conveniences you find in it, the bathroom to clean yourself, the bedroom to get rest, the kitchen to feed yourself.

I’ve captured it in a DanelDoodle just in case it’s not clear with some other examples.

cx and cs house

Customer Success

The Customer Success Team Maturity Model

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NOTE: The thinking behind this model applies predominantly to enterprise SaaS operations. It also applies to the maturity of your customer success team, not the customer’s maturity in relation to their use of your product or their interactions with you.

I’ve already written about the phases of the model above in this post: Customer experience, the subscription economy and 10 ways success teams will make you win

This long overdue post dives into the functioning of the maturity model. It’s not so much about the elements of each phase which are covered by separate chapters in detail.

Becoming a successful customer success organisation takes time and you cannot become successful overnight.

So the first premise to understand is that you need to level up through different phases of maturity.

Then that input and outcomes are necessary at each phase.

Finally, that the impact this has over time are central to the functioning of the maturity model.

As mentioned in the note in the very first lines, this model applies to the customer success team, not the customer.

On the latter, a very fine model has already been proposed by Boaz Maor – more on that here: Why your customer health score may be quite useless: your framework to calculate CMI

Mine is for those that want to build a customer success team as well as showcase best practice for organisations who have done it well.

Having said that, of course impact on customers business has to be figured into the equation and you will see how I’ve done that.

So onto a little around the main building blocks of the maturity model.

The build, grow, innovate side of the phases should be pretty self evident and covered sufficiently in the first post I linked to so it’s really for input, outcomes, impact and time to be explained.

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First a DanelDoodle to visualise things on the inputs and outcomes side. The context for this as I describe it is the science of customer success. The very necessary data driven side of things, something that I believe needs emphasis.

Input

Input should cover not just human activity but technological and automated activities.

Each chapter will cover this in more detail but it is alongside the next area, also to be covered in chapters, that is crucial to understand a connection

In other words, the causality between what you or the customer does and what outcome results from the action.

Examples of input are shown in the diagram.

Outcomes

Outcomes should as far as possible be quantifiable.

That doesn’t mean to say you should only use telemetry to understand an outcome based on an input.

You could use qualitative means, through a survey for instance, to gauge user sentiment.

This would amplify understanding you would typically get from only looking at usage data for instance.

Notwithstanding the way you measure an outcome, it is nothing unless you look at its impact.

Seen in isolation, an outcome would just be a number or score, but without contextual analysis of what impact it is having, it might be meaningless.

Examples of outcomes are captured in the diagram.

Impact

By this I mean impact on the customers business. Material effects from actions with resulting outcomes.

The emphasis which cannot be stressed enough, is impact on the customers business.

This is kind of the last mile.

In an enterprise SaaS business, while outcomes can be measured in terms of effects it has on users, impacts need to be measured in terms of how end customers are effected and how this impacts on your customer’s business.

The formula would look something like this: X (input) + Y (outcome) = Z (Impact)

A simple example: A mailing with an explanation of a new feature increases usage of that feature by staff which results in an uptick of end user satisfaction.

Time

Time per se is not difficult to understand.

What I want to stress is the likelihood that at the beginning of the journey you will not be in a position to be tracking the kinds of impact I’ve referred to above as you will later on.

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That’s because you will be too busy building systems (often internal operations) and may not even have the capability to track inputs, outcomes and impacts.

The latter largely also depends on your customers involvement which will depend on the length of your relationship and their own maturity.

I’ve often said that anytime I start out in a new role or advising starting out anew, my starting point would be this dashboard above left.

As a Service, Customer Success

The connected car vision is missing a few connections

The connected car is the future for automotive companies.

There is a lot going on in this space. I know because in my business, I have several customers in the industry.

But you don’t need to be in the business to know.

I recently purchased a car. It’s connected and awesome, I’m impressed.

But my experience taught me that something is missing.

I did not need too many people to help make the decision on the company and car I chose.

I made my decision and purchased without seeing the car physically. I investigated many options with various companies and did it mostly online. Talking to sales people was necessary at certain points.

I also made a decision to lease a car which will be up for renewal in 2.5 years.

That part took some time. To understand all the nuances I had to speak to people.

Dealing with the people and in many cases the online experience around many of the decision factors was mostly an awful grind.

That was all leading up to my decision.

In 2.5 years I will decide to continue with the same car and company, or not, based on a different experience. Some of that experience will be based on the car, including its connected features, some on further experience with the company.

I’ve not had much to do with the company since. The experience with the company after I decided was mostly good but it could have been a lot better.

I’ve opened up all communication channels with the company. I’ve made myself as receptive to the experience as possible. Time will tell.

Some questions for the industry

I get that the connected car concept is all about technology but is the industry thinking enough about other necessary connections?

Does it get the connection between experience and satisfaction and that this derives from many (often joined up) factors like people, technology and processes?

When the experience derives from people do they make the connection between the employee experience and how this influences the customer experience? To be specific I’m thinking that employees that have a great experience and are satisfied at work reflect that on to the customer.

Do they get that the rules of ownership are changing. Many do, getting in on the subscription model business, e.g. BMW and Lexus, Mercedes Benz, Volvo, etc. But do they realise subscription models bring new responsibilities?

Do they get how influential experience is in driving decisions, especially ongoing decisions about staying with a company or product, or not?

Do they get that technology is easily copied but experience isn’t?

Conversely, does it get that technology could play such a large role in connecting not just the internet of things for instance, but the internet of human experience?

They would probably say yes to all of the above. From my rhetorical questions you might guess where I lie on the matter. I guess it’s a question of maturity.

My recent experience and these questions are useful for the eBook / trend report I’m writing so excellent grist for the mill. I will try and answer them and provide recommendations. In the meantime…

Three ways I suggest the industry can start improving:

  1. Be more SaaS. The Software as a Service industry has learned a trick or two about how to build superb customer experience and the importance of customer retention and lifetime value. Specifically adopt many customer success approaches. Use the product itself (the car, starting with onboarding) as a core part of the experience with add on technology to enhance it through ongoing interactions that are data driven and point interactions with humans to amplify and delight.
  2. Extend the experience map. Map experience from employee through to customer and deliver on it from end to end. See it as an holistic journey that is harmoniously interdependent and made up of many parts: people, process, technology. Many are doing experience mapping but not adequately and not end to end in the way described.
  3. Bolster your employee experience. Its not just about the customer. This so often lags with employees playing second fiddle especially with the technology that supports work not matching what the customer gets. Robots and automation, especially in the auto industry, may play an increasing role but for the foreseeable future, humans will still play a disproportionate role in creating and nurturing human experience. Customer experience starts with employee experience.
Customer Success

Role of purpose and intent in customer success

How do you begin to assess how successful you are likely to be with your customers ahead of the customer success journey?

Taking this approach, perhaps you can even determine if you should embark on the journey or not.

A good place to start is probably the end point. Stephen R Covey, author of the The Seven Habits of Highly Effective People, nails it in his second habit:

Begin with the end in mind.

How difficult or easy customer success is likely to be and therefore how your strategy and plan needs to reflect this has a lot to do with these two factors: intent and purpose.

I often use them as a prioritisation criteria. Once you determine a customers intent and purpose with your technology, you could decide on what level of support to provide them, or if they even get it.

They’re not the only two factors by any means but I often start with them. Here is the matrix I use.

purpose intent matrix

I do this in the context of key stakeholders or stakeholder groups.

For instance you’d expect that the person or team that made the main decision on your product will have a clear intent and purpose.

But what about other key stakeholders, sometimes more important ones? They may not view it at all in the same way.

What is purpose?

You have a clearly defined vision and definition of outcomes you mean to achieve with the product.

What is intent?

You actually mean to put the technology to use in a specific way. You’d be surprised but sometimes, especially with technology suites or bundled functionality, the intent is not there in totality. Sometimes where a person/s had no involvement in the decision, they have no intent to use it. Or at least the intent has not been given the chance to form.

Absence of any one of these will require different tactics but thats for another post.

Other factors

As mentioned there are other factors to consider before embarking on or in prioritising your success journey with customers. For example, I had a brief conversation with Shawn Riedel who replied to a post on LinkedIn when I shared the matrix. I’ve captured the relevant bit below:

Shawn Riedel
Stephen I think these make a lot of sense to add to other decision matrices [emphasis added]:
People: X – Desire Y – Skills
Process: X – Impact to Revenue Y – Modularity of Process
Modularity of Process actually tells us how ingrained the process is and if it can be lifted or changed with minimal impact.
Technology: X – Effort Y – Complexity Optimal Outcome actually ends up in the lower left corner for this one. Least complex, least effort will result in a better outcome.
Me
Totally think these could work. Next step would possibly be to create a multi-dimensional matrix. Point being to aid prioritisation and decision making

What do you think? Does the approach make sense and what factors would you use?

Customer Success

Measuring customer success one advocate at a time

Creating customer advocates is a measure of customer success by some.

Not enough though, in my view. I have a view because I’ve helped create a fair share of advocates. Just recently three of my customers got up on stage and spoke at a large event to other customers and prospects.

I’ve also had the CEO of the largest bank in Africa come and speak at an event I created for other customers and prospects in the financial services industry. He went on to expand his business with my then employer to the tune of a $30 million, multi year deal (TCV).

If ever there was a worthy proxy for customer success this would be it. Apart from renewal or expansion I’m not sure there can be a better indicator of customer success. And as you saw in my example above, the one often leads to the other.

How you qualify an advocate

Okay there are some prerequisites to how you qualify an advocate.

They should ideally be the person or persons that are responsible for paying for the technology.

Ideally they should be highly influential in the organisation.

Failing either of the above, vast numbers of advocates would make up for this.

What else about advocates tells you they are one?

They are willing to speak for you in public about their use of the platform.

They have great stories of that use that they can regale other customers or prospective customers with.

They are happy to write reviews or case studies and jump on calls with other customers or prospective customers.

Last but not least, they should be credible. Either as speakers or writers or they have good standing in the community or industry.

Why advocates qualify as a measure of success

Well in the first instance you’d think they were supremely satisfied or why would they be an advocate otherwise? And customer satisfaction is a measure of customer success so this would be one way of indicating it.

They are also very tangible. You can count how many times a customer speaks for you, jumps on a reference call, helps author a case study. Tracking these success events allows you to track customer success performance very easily.

How to create advocates

  1. Make them successful, thats the first step. Meaning how they achieve outcomes with your technology but also in how they are perceived in the organisation. Making them look good in the eyes of their peers is a surefire method.
  2. Nurture the relationship and make advocacy a clear expectation upfront before you put the effort in. Let them know that given everything goes well, you’d like them to be an advocate for you.
  3. Make others in your organisation responsible for building them, especially executives. Lavish relevant attention on them. Through product teams and executives to make sure their voice is being heard in new feature development is one good example.
  4. Elevate their advocacy and profile and enhance their credibility by putting them on stage, help them co-author credible content or case studies that can be widely shared or get them in front of peers, e.g. meetups.
  5. Arm them with the success stories and product knowledge they need to be effective advocates. Its no use if they are willing but not able to be effective advocates.