I recently wrote an article for DM News about building a Customer Success practice. You can read it here. Step 1 in that process was “Create and enforce a customer-focused philosophy for the whole company.” It’s step 1 because it’s the foundation for everything you do to build a true Customer Success culture. Let’s explore some of the elements that can drive that culture throughout the organization.
Why is this important?
First of all, let’s establish why it’s important for the Customer Success culture to permeate your entire enterprise. Customer Success as an organization is actually very similar to a Sales organization. They bring lots of skills to the table to assist customers, but they cannot ultimately be successful unless the rest of the company fully supports their goals. It’s not as simple as setting up a team of people and saying “go make sure all our customers are happy.”
Every other organization in the company must be bought in to the idea that customer success is a company priority—because they will each be directly or indirectly involved in making this happen. Let’s take Sales itself as the example here. Customer Success cannot meet their retention goals if Sales is overselling the product or selling it to the wrong customers. I’m not suggesting that Customer Success be used to put handcuffs on Sales. I’m simply saying that meeting the company’s retention goal will require the participation of all organizations.
Elevate Customer Success to a VP-level organization
One of the ways to ensure that the customer success attitude is prevalent across your enterprise is by title. If your Customer Support organization and Sales organization and HR organization all have a VP, then you should have a Customer Success VP as well. This is simply a way for the CEO to elevate the value of this role and make the importance that he/she is placing on it clear. If the role, and associated deliverables and responsibilities, really are important to the company, the title should definitely come with it.
Speaking of associated deliverables and responsibilities, this is where the rubber really meets the road. At the highest level, the measurement of customer success is retention and upsell. Satisfied customers renew their contracts and buy more products from you. Having a VP of Customer Success and assigning him the company retention goal also gives him the power to go make the changes necessary around the company, to hit his number. Because of the nature of the position, this is the person from whom no other organization can hide.
He will know if customers are being properly trained or onboarded. He will know if Customer Support is or isn’t doing their job. He will know if Sales is forcing deals upon customers ill equipped to be successful with your products. He will know if the product is not performing as it needs to perform. The elevation of Customer Success to a VP-level organization, and the assignment of a critical company business measurement to this person, will ensure that pressure is applied to all organizations in support of that goal.
It’s no different than Sales pushing Engineering to add a certain product feature in order to break into a new market. The organizational tension created by the needs of customers as filtered through the VP of Customer Success, is both healthy and necessary.
Get the compensation plans right
Another thing your CEO should do to create a customer success culture is to make sure compensation plans reflect this priority. This can be as simple as making the company retention number part of the executive bonus plan. At one company where I worked, the executive bonus plan consisted of only two metrics – 1) new business sales and 2) renewal rate. One number was owned by the Sales VP, and the other was owned by the Customer Success VP. This ensured that any visit I made to the VP of Engineering was treated with equal importance to the needs of the VP of Sales. This plan made a simple but very effective statement to the entire company.
Some practical tips to drive the message home
As with any other part of a company culture, the CEO sets the tone. Above are the high-order bits in the process of adding customer success to a culture, most of which are driven by the CEO. But there are other practical ways of getting this point across as well"
- Last assessment – rank every post-production customer interaction. If your Product Manager talks to a customer, have him rank their temperature. If your CIO talks to a customer, have them do the same. After a CSM talks to a customer, they should record an assessment, too. This doesn’t take the place of your Red, Yellow, Green process, but it gets everyone in the company thinking about how the customer thinks and feels about you and your products, and that every single interaction is important.
- Sales assessment – every time you close a deal. Force the Sales Rep to honestly evaluate the chances of the customer being successful. They always know who is ready for success and who will likely struggle. Trust this assessment and use it to treat certain customers in a different way. You’ll be amazed at how accurate this assessment is, and thus, how valuable. At most companies, everything really does begin with Sales, and starting the customer assessment process right there sends a message.
- Survey regularly and close the loop on survey feedback. Don’t take feedback, positive or negative, without acknowledging it and taking action where necessary.
- Make noise about Customer Success. Celebrate high survey scores, successful onboarding, renewals, upsells, and advancement to the next lifecycle stage. Bookings after the initial sale at most SaaS companies will be 10x the first deal. This matters big-time to the company, and therefore, the wins that drive that bottom line should be celebrated.
If Customer Success really matters, then that message has to be clear from the very top of the company (CEO), and at the very start of the customer lifecycle (Sales). If you can get the ball rolling from those two starting points, you should be on your way.