How to charter customer success within your organization

Setting up your enterprise's Customer Success team.

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Florence Ion/IDG

Launching Customer Success within your organization? That’s great! It means you have conceptual buy-in about the value that Customer Success can bring, and probably the expectation that the new team will contribute to an increase in overall revenue through their dedication to preserving existing customers.

Executive buy-in and expectations tied to revenue are foundational to launching a Customer Success team of any size. However, if you’re leading a new team, you know there’s much more to establishing your team within your organization. Other teams (sales or professional services) may not “get” what you do. There can be legitimate confusion and tension about where Sales ends and where Customer Success begins, and who “owns” the customer. There can be internal and customer-facing friction if there’s not a solid charter and supportive leadership in place to give CS the identity, vision, and capacity it needs to deliver.

Pre-existing model

Prior to launching Customer Success at your organization, what post-sale model was in place to help keep customers engaged? In many instances, there’s a sales role responsible for the relationship. An Account Manager (most common title) is often assigned closed deals and responsible for preserving the relationship and farming opportunities for upsell and expansions. This resource is usually born and trained within a sales team. Account managers are typically highly relational people, so customers like them just fine, but they don’t see them as technical experts who can help them solve problems.

In addition to account managers from the Sales team, there may be a consulting arm within your organization that provides professional services. These are project offerings delivered through long-term, sometimes on-site resources. (Note: In organizations born in the cloud (true SaaS folks) these engagements aren’t always long-term or on-site.) This team also has ongoing relationships with customers, and may serve as eyes and ears into a customer to identify opportunities for account growth. The Professional Services team is typically comprised of technical consultants with strong product knowledge and project managers

Enter Customer Success

Customer Success teams are formed because these existing models aren’t adequate in preserving value for existing customers. Account Managers have account growth goals, and customers can smell a sales person through the phone. Professional Services poses two potential challenges to the customer relationship: either they lack the interpersonal skills (may be too technically skilled) or they establish themselves as a good contact for the customer, but really should be moving on to the next billable project.

CSMs are unique hybrids in terms of their talents and skills. They have deep product knowledge AND great interpersonal skills. When they are inserted into customer relationships, there can be some confusion and/or tension that arises. Sales and Professional Services teams can feel as though Customer Success Managers are usurping opportunities from them or they simply don’t understand where this new relationship fits in.

(Let’s not forget how this feels to the customer…)

Before offering a charter for managing this internal challenge, let’s not forget to mention that new CS teams can also be met with surprise by existing customers. While customers may not always like having account managers “checking in” on them, that’s who they have the relationships with. So, when Customer Success managers are newly assigned to existing accounts, the customers themselves may need some coaching on what to expect from whom. The process and skill set for engaging with existing customers is simply different than those used for engaging with new customers. The remote nature of the role can make establishing this relationship challenging. It takes consistency in communication – from Sales and Customer Success – and true commitment to meeting expectations to have success in introducing this new entity into the relationship.

Process of initiating Customer Success

Start with a shared goal

The way to make this new organizational structure work the way it’s intended is to create a WIN-WIN-WIN game plan and charter. First of all, the Customer must win (or this whole paradigm is useless). Secondly, sales must increase (both upsells AND new acquisitions). And, finally, Customer Success team members must win by knowing what’s expected of them and feeling effective in performing their duties.

To establish a WIN-WIN-WIN charter requires strong and visionary leaders that can articulate and socialize the reasons for creating a Customer Success team, and the value the team provides to the organization as a whole (and, therefore, to other individuals and teams within the company). Note the ultimate importance of executive sponsorship and leadership to the success of instantiating Customer Success. Without a strong voice and clear executive communication, the team is likely to face internal and external friction that can reduce their efficacy.

Begin with a clear and strong value statement about Customer Success. Here’s an example:

Our Customer Success team is charged with ensuring that existing customers remain engaged in our solution and don’t attrit. Their expert services provide customers with the resources they need to grow their usage and establish mutual trust that will result in organic renewals. These renewals are vital to sustaining and growing our company’s revenue.

This responsibility must come through the leadership team, and must be articulated to stress the purpose and importance of having and supporting a Customer Success team.

Chartering Customer Success

Creating a charter for your Customer Success team requires universal understanding (and buy-in) to how these resources bring real value. Begin the process of establishing a charter by asking, answering, and sharing the following questions for your existing (prior) organizational model, and for the future (present) one which includes a Customer Success team:

  • How are new profitable revenue streams identified in your organization?
  • How do (will) you unlock the potential of your customers’ technology investment?
  • How do (will) you increase your customers’ usage?
  • How do (will) you demonstrate leadership within your space?

Answers to these questions will reveal the value of expert service resources and pave the way for restructuring and reassigning duties that focus on personal strengths and value to the organization. The charter for Customer Success is born from answers to these questions.

Identifying and describing roles and responsibilities

Even if people know why a Customer Success team has been formed, they are, ultimately, more interested in knowing how this new resource or team is going to affect them personally. Questions about roles and responsibilities will abound, such as:

  • How will new customers be handed over?
  • What expert services are we selling?
  • Who will earn commissions on renewals?
  • How will upsell opportunities be identified? Nurtured? Sold?

Again, leadership is key here. No individual team member should assume a customer-facing responsibility without a clear definition of duties. The risk of assuming tasks is that toes will be stepped on and people will feel less value in their work. Clearly defining who does what and when, and how each team member will be evaluated and incentivized is the final step to “selling” Customer Success organizationally. Don’t minimize the work necessary in this step. Take time to consider input from all teams regarding

  • how things are currently done
  • what’s not getting done
  • what skills are best suited to perform these customer-retaining responsibilities.

Ultimately a new organizational charter should be created and universally socialized describing exactly who is responsible for what aspects of customer relationships, and how each person will be incentivized/compensated for their work.

A little advice

Creating a charter for Customer Success isn’t as simple as drawing a line in the middle of Account Management and saying, “Sales, stay on one side, and Customer Success, stay on the other.” If that’s really all you’re looking for then we do offer a simple rule of thumb:

Whenever a contract requires any negotiation, (non-automatic renewals, upsells and cross-sells) Customer Success should stay out of it. Customer Success managers are customer advocates and, in that capacity, they should not enter into a negotiation.

But, there’s more to the division of responsibilities for customer care. There are multiple areas that need to be allocated and assigned:

  • Account Management (managing renewals, upsells and cross-sells)
  • Customer Operations (analytics and reporting)
  • Professional Services (service delivery)
  • Customer Support (Services and Support)
  • R&D (product development and updates)

Whether you include all of these responsibilities within a Customer Success umbrella, or keep some of them autonomous depends upon several factors: the complexity of your solution, the age and maturity of your company, the size of your organization, etc.

Hammering it home

While most XaaS organizations have agreed to the theoretical value of having a Customer Success team in place, many are still struggling to fully integrate the concept and team into their organizational structure. The struggles are both logistical (identifying who fits where and how are they each compensated/evaluated) as well as psychological and emotional (keeping individuals and teams remain motivated and positive about their positions). Having executive sponsorship that communicates the value that expert services provides your organization is essential to mitigating the angst personnel feel during transitions. Additionally, ensuring that each new role has its own value to contribute to the overall health and growth of your organization is key! Gaining full buy-in to a new organizational charter is a process, not an email. Leadership MUST have a full eye on what’s best for the customers, the organization and each employee.

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