Making Leaders Successful Every Day

Customer Success Evolves to the Next StageFour Steps To Institutionalizing CSM

Kate Leggett

Principal Analyst, Forrester Research

@kateleggett

kleggett@forrester.com

We have entered the “age of the customer”

Source: June 6, 2011, “Competitive Strategy In The Age Of The Customer” Forrester report

We have entered the “age of the customer”

Source: June 6, 2011, “Competitive Strategy In The Age Of The Customer” Forrester report

Our world is moving to a subscription economy

Credit: www.zuora.com

Our world is moving to a subscription economy

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And the business model for technology is moving to subscriptions

January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

14%

© 2012 Forrester Research, Inc. Reproduction Prohibited

And the business model for technology is moving to subscriptions

January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

21%

© 2012 Forrester Research, Inc. Reproduction Prohibited

And the business model for technology is moving to subscriptions

January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

13%

© 2012 Forrester Research, Inc. Reproduction Prohibited

The subscription model has tipped for many B2B software categories

January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

© 2012 Forrester Research, Inc. Reproduction Prohibited

The subscription model has tipped for many B2B software categories

January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

© 2012 Forrester Research, Inc. Reproduction Prohibited

The subscription model has tipped for many B2B software categories

January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

And because of this relationships are becoming more important

Product Focused Relationship Focusedwww.zuora.com

Good relationships have business value

March 2012 “The Business Impact Of Customer Experience, 2012”

Customer success managers actively manage customer relationships to reduce churn, increase existing revenue and influence new sales

This business value can be easily quantified

HOW TO GET STARTED

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Interviews with customer success organizations told us that there are many challenges to overcome

Challenge Rating

Organizational structure governance

Finding the right skill sets

Accessing the right data

Operationally managing the CSM organization

Measuring the effectiveness of the team

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ENGAGEMENT STRATEGY

ENGAGEMENT PROCESSES

ENGAGERS ENGAGEMENT LEVERS

Customer success management takes coordinated effort across four dimensions

© 2012 Forrester Research, Inc. Reproduction Prohibited

ENGAGEMENT STRATEGY

ENGAGEMENT PROCESSES

ENGAGERS ENGAGEMENT LEVERS

Customer success management takes coordinated effort across four dimensions

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Where are you in your growth?

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Where are you in your growth?

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Where are you in your growth?

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Tier your customers

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ENGAGEMENT STRATEGY

ENGAGEMENT PROCESSES

ENGAGERS ENGAGEMENT LEVERS

Customer success management takes coordinated effort across four dimensions

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Define and standardize your processes

• Onboarding and product adoption • Who is using product? Who is not?• What features are being used?• Are stickiest features being used?

• Processes to drive adoption

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Define and standardize your processes

• Best practice education• What is the business goal of your customers?• What value they are getting from your product• How well are they aligned to best practices?

• Engagement meetings / Quarterly reviews• Standardize the processes to quantify and

communicate business value

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Define and standardize your processes

• Managing at risk customers• Do you have a definition of at risk?

› Lack of product use› Difficulties with product (tickets, calls)› Lack of engagement

• What are the processes to follow for at risk customers?

• What is the intervention timeline? Who is responsible?

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ENGAGEMENT STRATEGY

ENGAGEMENT PROCESSES

ENGAGERS ENGAGEMENT LEVERS

Customer success management takes coordinated effort across four dimensions

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Where does your CSM group live?

CEO

Customer service OperationsSales

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Where does your CSM group live?

CEO

Customer service OperationsSales

Low-level of product complexityNot responsible for new salesResponsible for ongoing success of accounts

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Where does your CSM group live?

CEO

Customer service OperationsSales

Low-level of product complexityResponsible for ongoing success of accountsWork hand-in-hand with sales, but not responsible for new sales

Goaled on retention and

expansion measures

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Where does your CSM group live?

CEO

Customer service OperationsSales

More complex product“Trusted advisor” with good product and domain knowledgeFocused on customer satisfaction and retentionMust have good relationship with sales

34© 2012 Forrester Research, Inc. Reproduction Prohibited

Where does your CSM group live?

CEO

Customer service OperationsSales

More complex product“Trusted advisor” with good product and domain knowledgeFocused on customer satisfaction and retentionMust have good relationship with sales

No standard measure of success –

renewals, revenue expansion

35© 2012 Forrester Research, Inc. Reproduction Prohibited

Where does your CSM group live?

CEO

Customer service OperationsSales

More complex product and more mature organizationClear delineation of responsibility: the CSM owns the customer, Sales is responsible for new business, customer service is responsible for support

36© 2012 Forrester Research, Inc. Reproduction Prohibited

Where does your CSM group live?

CEO

Customer service OperationsSales

More complex product and more mature organizationClear delineation of responsibility: the CSM owns the customer, Sales is responsible for new business, customer service is responsible for support

Goaled on customer retention

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Who makes a good customer success manager?

Passionate for serving customers

Relationship builders

Well organized and good listening skills

Good at conflict resolution

Proactive and can-do attitude

Technical enough

Best practice knowledge

Domain expertise

Work at all levels of an organization

Account managers

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ENGAGEMENT STRATEGY

ENGAGEMENT PROCESSES

ENGAGERS ENGAGEMENT LEVERS

Customer success management takes coordinated effort across four dimensions

© 2012 Forrester Research, Inc. Reproduction Prohibited

What data do you need?

39

Customer

Goal

Inactive users

Provisioned users

ContractTerms

Renewal

Realized economic

value

Audit records

Feedback

Advocacy

Support feedbackCustomer

feedback

Active users

Measures of success

Features

Alerts

Calls and tickets

Onboarding

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What do you do with data?

Integration Validation Visualization

Analytics Exploration

Workflow

Data

Insights

Action

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The Advanced Playbook

LOBData

Enterprise Insights

Outside-inAction

• Customer360• Alerts

• Surveys• Automated Email

• Health Scorecards• Playbooks• Workflow

• Embedded Apps

• External Sponsor Alerts• Automated Customer

Presentations• Mobile

• Data Science

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ENGAGEMENT STRATEGY

ENGAGEMENT PROCESSES

ENGAGERS ENGAGEMENT LEVERS

Customer success management takes coordinated effort across four dimensions

Thank youKate LeggettPrincipal Analystkleggett@forrester.com@kateleggett

Thank you

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