Friday, November 21, 2014

Three important relationships

Driving results through Customer Success requires balancing relationships across Customers, Sales Partners and Product Management. This balancing act can, at times, resemble juggling chainsaws: each relationship is important, powerful on its own and has the potential to be a great resource, but if not handled properly, each can also cause significant damage to everyone around it. While balancing these three relationships is the key to driving results, creating effective relationships requires more than just back slapping and big talk. Within these relationships, Customer Success requires understanding and executing three key roles:

  • Advocate
  • Subject Matter Expert
  • Trusted Advisor 

These three roles are foundational to building effective relationships with Customers, Sales Partners and Product Management.


Advocate – Customers need a voice in the organization, and an advocate for the features, functionality and services they need to be successful. Customer Success is charged with acting as this advocate. The challenge in the role of advocate is knowing when a customer is asking for too much, asking for the wrong things or just being a pain in the ass because they can be. Effective advocacy for customers starts with knowing when to go to bat for your customer and having the relationships and business case to make each request most effectively.

Subject Matter Expert – Customers don’t always know what they don’t know. The role of Customer Success is to provide them with access to subject matter expertise they need to make good decisions. It does not mean that the Customer Success Manager needs to be or needs to position themselves as the all-knowing oracle. Rather, they act as a facilitator, bringing in the right expertise when needed. It also doesn’t mean that the customer is going to listen. The challenge in the role of subject matter expert is providing access to this expertise in a way that empowers the customer and the Customer Success Manager, maintains the relationship and sets a clear executable path forward.

Trusted Advisor – The path to customer success sometimes involves telling the customer things that they don’t want to hear, telling them the answer is no or that the problem is not with the software but with their team. The most difficult relationship for a Customer Success Manager to establish is that of trusted advisor. Customers are slow to trust vendors, especially those that call their babies ugly. The challenge in the role of trusted advisor is first establishing, then knowing when and how to leverage the relationship to help customers be successful.

Sales Partners

Advocate – If a sales person came to your front door would you let them in the house? What if they came calling every day with some new and even more important innovation than the day before? You might start pretending that you aren’t home. But what if that sales person came to the door with your best friend and trusted advisor? You, like many customers, might be inclined to hear them out. The role of advocating for sales partners is a difficult balancing act. You will quickly lose your trusted advisor relationship if you are beating a path to your sponsor’s door with every new discussion the sales team wants to have. At the same time, if you aren’t enabling sales, you simply aren’t doing your job.

Subject Matter Expert – The best sales partners are eager to find subject matter expertise and leverage that to solve a customer’s problem while driving a sale in the process. The challenge in the role of subject matter expert supporting sales is ensuring that the expertise you provide is not distorted to fit a sales agenda that is in conflict with true customer success. There is a well-worn saying about sales and customer success: “They [sales] sell the dream and we [customer success] live the nightmare.” The role of subject matter expert can be a clear competitive differentiator with sales, especially when combined with the role of trusted advisor to the customer, but this is a relationship that needs to be carefully cultivated and managed.

Trusted Advisor – Sales managers, and not all of them will admit this, don’t always know everything about the product, the customer or the customer’s business challenges. Driving big deals requires aligning these three elements and the role of Customer Success is critical. In the role of trusted advisor, the Customer Success team can provide the sales team with insights into the customer and product fit, helping sales find the optimal alignment.

Product Management

Advocate – While the customer needs a voice in the organization, the product team needs a voice with the customers, an effective advocate for how the product works today, what it is designed to do and why, and balance the legitimate needs of the customer for product evolution with the needs of the product team for innovation. The best Customer Success Managers balance these competing priorities because they truly understand their customers’ needs not just today but tomorrow and a year from now. And they enable the product teams to get there by managing expectations on both sides for incremental evolution as well as step-wise innovation.

Subject Matter Expert – Product management and engineering need eyes and ears on the street to ensure that the problems they are attempting to solve through the software are 1) the right problems to solve and 2) being solved. The role of customer success is critical here. As subject matter experts and trusted advisors to the customer, customer success managers can help interpret the business and ensure the most effective alignment of software to business need. This requires not only subject matter expertise but the ability to understand current and future business needs of the customer, and support the product management team in making the translation to software requirements.

Trusted Advisor – Product management needs a trusted advisor who can help deliver bad news to customers and properly interpret customer feedback. Not every feature is going to be released on time and not every release is going to be bug free. Product management needs a trusted advisor in Customer Success to understand the level of impact of the product miss and to understand the right course of action to correct the customer impression and frustration. The challenge for Customer Success in the role of trusted advisor is removing personal emotion from the conversation and focusing on advising the product team on what the customer really needs to move forward.

Driving results through Customer Success requires balancing these three key relationships. By understanding and seamlessly executing the three roles of Customer Success, the juggling act becomes a feat of skill rather than an accident waiting to happen.

About David Verhaag 

David is the Vice President, Client Experience at Degreed, the lifelong learning platform. Prior to Degreed, David established and scaled the Customer Success function at Kahuna and HireVue and spent eight+ years with SuccessFactors where he led the development of the global Customer Value team. David lives on a sailboat in Half Moon Bay, CA.

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Sunday, November 2, 2014

Six Elements in Launching Customer Success

How do you create customer value? Several weeks ago I had the opportunity to present what I believe are the six key elements to creating customer value through a customer success team. First...

Customer Focus

Keep it simple, keep it focused on the customer.

Customer Focus requires that the Customer Value team be focused first and foremost on the customer. Not internal processes, not case studies or success stories or marketing or sales. The team needs to be focused on the customer and ensuring that they are getting value from our products and services. Simple as that. All of the good things for the company-- renewals, up sell and expansion, net promoter score, references-- come from a clear and consistent focus on customers and their success. The customer value team plays the pivotal role in ensuring that customers experience an extraordinary relationship with the organization.

Customer Lifecycle 

Creating customer value requires that you understand your customer's journey and align people, tools and processes to help guide them along the way.

At HireVue, we created a five step customer lifecycle (on boarding, review/assessment, renewal expansion, optimization, maturity) and as a team project we mapped the characteristics of each of these phases. We looked at which customers were most successful based on net promoter score, renewal, expansion, executive engagement, etc., and identified the steps that we as a company had taken to create that success. From these insights we then created a lifecycle map that highlighted the characteristics of each step and identified what a Customer Success Manager could do to engage and drive the customer to the next level. As we continue to evolve our program we will map in the exact resources so the CSM has, at their fingertips, a map and the tools they need.

Customer Engagement Model

Aligning customer value resources to accounts based on type can accelerate adoption, expansion, satisfaction and renewal.

When we first implemented Customer Value at SuccessFactors, we focused on renewal risk management. We engaged with customers in the last year of their agreement with SF and prioritized based on contract value. We would uncover significant risk in accounts that had been neglected since their original implementation. The engagement model was reactive and led to a heavy emphasis on crisis management. Ultimately we became so effective at the "diving catch" that we were able to convince leadership that we should adopt a more proactive engagement model. That led to an expansion of the team to focus not only on renewal risk but the entire customer lifecycle. At HireVue we started there. I joined the team because they were willing to invest in proactive full lifecycle customer success for all accounts. The executive team and board already had religion, they needed execution.

Data Backed Decision Making

Long term customer value requires that we utilize all of the great data we have about our customers to make decision on how best to support those customers.

At SuccessFactors, we partnered with Jeff Ulrich and Ron Stainbrook to create a tool called SuccessCentral, an in-house version of what Gainsight, Bluenose, Totango, and similar customer success software solutions offer today. SuccessCentral enabled the Customer Value team to see all of the relevant information about an account on one page. It had the additional benefit of providing customer facing views of the data. This data included a summary of the resources and account ownership, products they had purchased and subscription dates and amounts, account health flags and notes, support utilization and benchmarking, and most importantly, adoption data. SuccessCentral gave the team a comprehensive view of the customer. At HireVue we leverage Salesforce and customer report solutions from our team Business Analyst to gain insights into the customer. Beyond just having a summary of the data though, we created a customer health index. Partnering with our data scientist we analyzed all of the data that we have on our customers and looked for those data points that were most highly correlated with account expansion and renewal. This provided some big surprises (for example, product adoption is not highly correlated with account renewal), and we leveraged these insights to create a customer health index, a single score for accounts that benchmarks them and allows us to systematically identify accounts that may be at risk or have an opportunity for expansion. The score takes into account the customer success manager’s view of risk and layers on more objective measures like implementation approach, net promoter score, and executive engagement as well.

Continuous Improvement 

Building a team to drive customer value involves planning for continuous improvement to ensure that the evolving needs of customers and the business are met in the most efficient and effective way possible.

At HireVue, we started with an engagement model of 10 named accounts per account director, 30 enterprise accounts for each customer success manager and 50 mid-market and SMB accounts for each junior customer success manager. We saw growth in the mid-market segment accelerating more quickly than the enterprise segment and we were posed with the challenge of investing in more mid-market and SMB customer success managers or in named account directors. But it was clear we needed both if we stuck with the model. We started with the data and looked at the revenue (easy, no question), impact on product evolution (not as clear cut) and adoption (not even close) for each of the segments. This led us to the decision that we should hire an account director (done) and a mid-market SMB rep but… one that would scale in a new segment, SMB. We hired a junior resource, a really smart, energetic and ambitious account representative, who could manage a portfolio of 100+ accounts in the SMB segment. Her focus, and I have been working closely with her on this, is a light touch model that still serves up the best of customer success but scales to a much larger portfolio of small business accounts.

Celebrate Success
By highlighting the simple things in a low friction way we have built a culture of celebrating success, building and sustaining our customer first focus and ensuring that the team knows that their small results matter.

At HireVue we celebrate success, not just of the major renewal wins, but customer feedback on the journey. When I joined the team I asked that everyone post the top three activities for the week and the top three results from last week in our open Chatter group. This exposed the broader team to what everyone was working on and drove visibility to the leadership of our focus and results. It also had the benefit of creating an environment where everyone could visit and check in weekly. We have been using this group for “shout outs” which are quick highlights of team success. Sometimes these are renewal wins, but more often, and an important ongoing focus, is highlighting simple customer success, doing the right thing on small issues that drive bigger opportunities and customer satisfaction. Recently I highlighted a CSM who had received some positive feedback from a customer on walking them through their NPS report. The process of walking them through their data and making recommendations had led to change that drove positive progress the following month.

Creating value through a customer success team requires having a strong foundation of process, data-based decision making, and celebrating success along the way.