The way we expand accounts adds very little value to customers. Why? Because Sales still owns the revenue number. Here, we explore how Success teams can move up the expansion maturity curve to improve customer and company outcomes.
How many times have you received an email from a vendor that reads something like this?
We all know why this happens. Your vendor’s Product team releases new features, their Marketing team comes up with snappy language to describe the benefits, and their Sales team applies pressure to let customers know ASAP. Then you as the customer receive a generic “product update” email which is almost always unrelated to your goals and the problems you’ve reported to your CSM. I’d be surprised if you’ve even read one of those emails before sending it to the trash.
What’s worse is the “Renewal Check-in” meeting that gets put on your calendar by your vendor’s Sales team (when I say “Sales”, I’m referring to either Account Executives or Account Managers). You haven’t talked to your Sales rep all year, so they spend an hour asking you questions like:
The whole time you’re thinking, “This is such a waste of time” and you leave the call feeling worse about your vendor than when you joined. Vendors do this to us all the time, and somehow we do the exact same thing to our customers.
Customer Success has spent the last decade focusing on onboarding, success plans, QBRs, and influencing the product roadmap in an effort to deliver more value to customers. And yet when it comes to actually turning customer value into expansion, we pass the ball back to Sales and expect them to increase customer spend with very little understanding of the customer’s actual problems and needs.
The result is that Sales teams treat every customer like a nail, and they’re the hammer. They parachute into customer calls, hunt for new dollars, then run to the next deal as soon as possible. And rightfully so. Sales teams aren’t incentivized to deliver more value to customers, their job is to close deals. So by having Sales own expansion, we’re putting pressure on customers to grow even when they’re not getting enough value from their current solution. The hard truth that we have to face as Success leaders is that we’re hurting our customers and our companies by expecting Sales to drive expansion. And it’s our fault.
I’m always surprised when I hear Success leaders say “My CSMs don’t have the personality to sell”. The reality is that CSMs are motivated to build great relationships and find solutions to customer problems. It’s in their DNA. Those are the exact traits of high-performing Sales people too. The difference is that Sales teams have been trained to ask for dollars, and Success teams haven’t.
Success has focused so heavily on being the “customer advocate” that we’ve lost sight of the fact that upsells and cross-sells actually deliver value to customers. The more value we deliver, the more customers are willing to pay. And that expansion directly impacts our NRR and overall company value.
Bessemer Ventures did a study that showed that on average every 3% increase in NRR doubles a company’s valuation:
This means that every day Success hands upsells and cross-sells to Sales we’re saying, “Hey CEO and Board, the Sales team is much better at driving company value than we are.” It’s no wonder that Sales teams have more influence, a bigger budget, and get paid more than Success teams. Sales is in the driver’s seat, and Success continues to put them there.
Now you may be thinking that your Sales team would never let Success own expansions. Frankly, it’s not really their choice. Success is closest to the customer’s needs, which means it’s the only team with enough context to sell value-added products and services that address those needs. With that said, there is still a critical role for Sales and Professional Services teams to play when growing accounts in a way that adds value to customers. The key is for CSMs to become the actual quarterback of their customer accounts, creating upsell and cross-sell solutions that solve meaningful problems for their customers. In order to achieve that, Success leaders need to rethink how CSMs are trained to grow accounts across the customer journey.
Imagine going to your CEO and saying, “I can double the company’s valuation next year with the team I have today.” That’s a statement every Success leader can make with one simple change–training your CSMs to ask the right questions, to the right contacts, at the right time along the customer journey.
But before starting down this path, it’s critical for your CSMs to understand that by owning account expansion themselves they drastically improve their customers’ experience. Instead of asking your customers to comb through generic product emails or to join prospecting calls with Sales, those customers could work with their main point of contact (the CSM) to solve problems they actually care about. Some solutions can be delivered by the CSM alone, while others require more licenses, product modules, or service add-ons. And other solutions deepen the customer relationship by solving problems for new contacts and teams across the customer’s organization. All paths lead to the same outcome, delivering more value to customers.
The challenge is that your CSMs don’t actually understand your business well enough to grow revenue when they surface an opportunity for upsell or cross-sell. They haven’t been trained to “think like a CEO” and drive all outcomes of an account including value delivery, retention, and expansion. That’s why it’s your job as the Success leader to:
That last part is important. Success owning expansions doesn’t mean that it should be the “everything” function. CSMs should still delegate value-added services like onboarding, training, and executive strategy to ProServ. Similarly, CSMs should delegate upsell and cross-sell “paperwork” (procurement, legal, and security) to the Sales team to ensure terms, pricing, and features are in line with the company's current offerings. The key here is that “delegate” does not mean “abdicate”. CSMs must still be responsible for delivering all customer outcomes, leveraging Sales and ProServ teams as service providers to that end. This keeps CSMs focused on adding value to customers, turning that value into dollars, increasing NRR, and boosting your overall company valuation.
How you structure the exact roles and responsibilities of your expansion teams depends on where your company sits on the maturity curve:
Moving up the maturity curve doesn’t need to happen all at once. You can start by running a small experiment with the very best CSM on your team (the one that just came to mind). First, have that CSM ask these three questions on all of their customer calls:
Spend an hour a week doing account reviews with your CSM to spot opportunities based on customer responses to these questions. Then work with your Sales and ProServ teams to structure product and service bundles that solve customer problems that surfaced. Have your CSM offer those solutions to customers, and ask your Sales team to handle deal desk activities in the background (they’ll be more than happy to do this since it’ll count toward their quota with very little work on their part).
Once you solidify a Success-led process for upselling and cross-selling solutions to several customer problems, train the rest of your CSM team to do the same. Then track the change in average account growth before and after the experiment. After 3-6 months you’ll have enough data to propose to your CEO that Success owns the expansion number, and you’re off to the races.
AUTHOR
Nick Paranomos is a Co-founder and COO at ‘nuffsaid. He has over 15 years of experience in strategy, operations, product, and marketing for tech companies.
We spoke with founders and top leaders of each of the top Customer Success Platforms and summarized our findings here to help you make the best possible purchase for your business.
Success leaders generally aren’t very good buyers of software. And mostly, it’s not their fault:
And while the technology landscape for Customer Success is growing, it’s still microscopic compared to tools available for Sales, Product, and Marketing.
Thanks to Jeff Breunsbach @ Higher Logic for developing this landscape as of mid 2022.
Higher Logic connects people, knowledge, and ideas to improve lives and organizations. Through our community solutions, we empower growth-stage businesses and associations to build a more engaged and meaningful relationship with their customers and members.
The landscape of tools can grow, but only after Success leaders demand more from vendors, investors, and finance leaders. That includes conversations about missing technology in board rooms, posts on social media, 1:1 sessions with tech company CEOs, better justifications for tool budgets, and sometimes building their own internal tools with engineering resources.
We’ll start with how to advocate for budget for your Customer Success Platform since Success leaders can immediately change how they pitch for tools.
The formula to request more budget is fairly simple. You get more when you:
Let’s start with the worst way to advocate for Success budget and work our way up.
This approach results in decreased Success budgets 100% of the time. The reason is that the CFO will view Success as a cost to support revenue—similar to Customer Support. The CFO often treats Success as the Cost of Goods Sold (COGS), increasing the company’s total COGS. This is a disaster for the Success team budget:
Gross Profit = Revenue - Cost of Goods Sold (COGS)
If the cost of the Success team is added to COGS, that means Gross Profit decreases! And just like you can count on the sun rising every day, you can count on the CFO doing everything in their power to increase Gross Profit over time, meaning increasing revenue and decreasing COGS.
If you discuss the ratio of CSMs to revenue managed, you’ll have a squeezed budget. Period.
This approach positions the Success team as a revenue driver, which moves Success out of COGS and over to Revenue. CFOs love investing in programs that will increase revenue, especially if that revenue can be acquired more efficiently than expensive channels like more SDRs or advertising budget.
Some Success leaders are hesitant to take on NRR responsibility. The general sentiment we’ve heard goes like this: “Why would I put my job at risk for some extra budget?” And the “real talk” answer is that the person who owns revenue has the better job. They have more influence, more power to make customers successful, more budget, a bigger team, get paid a higher salary, and don’t have to clean up after the mess that other departments make. Do any of those sound interesting!?
This is the best strategy to advocate for budget because it connects your department’s results to what the CEO and CFO care about most—increasing company value.
A 1% increase in NRR, on average, leads to a 0.7x increase in company value. In other words, increasing NRR by 3% will double the company’s value (2.1x increase).
Now you own a number that not only increases the company’s growth and profitability, you also own a number that significantly drives company value. Where else can the CFO invest to produce that kind of return on company value?
If you use this strategy to increase your budget, spend some of it with TheySaid!
Before taking advantage of a Customer Success Platform (CSP), you must implement a few critical systems and processes.
If you don’t have these things, your Customer Success motion will be considered immature. And that will lead to these negative outcomes:
One of the biggest purchasing decisions, in terms of implementation time, process changes, and cost, is the purchase of a Customer Success Platform. To help you with your research, we interviewed all of the top CSPs and compiled the results of those conversations into the table below.
We asked each company how they’d describe their company to a potential buyer, and here are their responses.
Catalyst
If you have a CSP, but your team hasn’t adopted it, it’s time to talk to Catalyst. Catalyst has super high utilization rates compared to other offerings. Everything in the platform is structured to follow this flow: Insights → Action → Impact, emphasizing visibility into how Success moves the needle on health score, net retention rate, and more.
ChurnZero
Like marketing teams use Hubspot to automate marketing, Success uses ChurnZero to automate the customer experience. You don’t need a dedicated admin to implement and run ChurnZero. And ChurnZero provides the full ecosystem of partnerships, conferences, education, and content that other players (who target bigger companies) provide to their customers.
ClientSuccess
The first platform built by experienced CS professionals for CS professionals, ClientSuccess is focused on marrying simplicity with power. ClientSuccess provides a full-service Customer Success platform (onboarding, full renewal management, forecasting) for teams wanting to start quickly.
CustomerSuccessBox
“Don’t optimize your purchase based on the technology. Instead, choose the best partner to help you adopt the product.” CustomerSuccessBox will try harder with additional support and services to ensure you adopt the customer success platform.
Gainsight
Start and Scale your Modern Growth Engine. Gainsight Essentials is designed to address the problem that customers try to roll out too much functionality too quickly. With Essentials, you start with the core features and automation for High and Low touch and then easily scale into more complex products as your business evolves.
Planhat
The UX of modern tools with the power of mature platforms. In Planhat you can create multi-sequence automation based on any data source (Planhat data, data warehouse, product usage, tracking script, or Excel import), which triggers field updates, notifications, emails, API calls, webhooks, etc. Planhat started as an onboarding company (that capability is core) and then evolved into a Customer Platform.
Totango
The Composable Customer Success Platform. Things are always changing, and Totango is easy to compose your own journey, and it’s easy to adjust and change. Their modular approach to building the customer journey allows you to build pieces of your CS motion without launching everything at once.
SmartKarrot
Democratized Customer Success and augmented intelligence. We all have too much data and too many tasks, so SmartKarrot uses augmented intelligence to prioritize the data, tasks, and campaigns that move the needle.
Making a CSP decision is so critical to your team's success that it’s important to pick the right CSP for the right size and stage of your company.
In our research, we learned a lot about each company, their mission, how they think about building their products, and who they do the best job supporting. If you ever want my advice on which CSP to pick for your business, let’s connect on LinkedIn, and I’ll share my opinions with you: www.linkedin.com/in/chrishicken.
There are some great existing and emerging companies in the category. When you do your own research, verifying that the feature lists above are still accurate will be important.
Wishing you Success!
CONTRIBUTORS
Written by Chris Hicken. Thank you to everyone who contributed to this article, including Jeff Breunsbach at Higher Logic for sharing the Successcape, Sydney Strader at Catalyst, Hunter Montgomery at ChurnZero, Dave Blake at ClientSuccess, Puneet Kataria at CustomerSuccessBox, Kellie Capote and Scott Salkin at Gainsight, Chris Regester at Planhat, Prithwi Dasgupta at SmartKarrot, Anne Ting and Karen Budell at Totango. Vitally did not respond to interview requests for this piece.
FEATURING KYLE POYAR, OPERATING PARTNER AT OPENVIEW
This article was originally featured in 2.0—the first magazine for Customer Success. Our 2nd volume, Customer-Led Growth, explores the teams, systems, and executive skills a Customer Success function needs to lead a CLG model. Grab your copy.
It’s unlikely you are a SaaS pricing expert. Unfortunately, your peer in Marketing probably isn’t either. What’s worse, pricing is often created by Marketing and Sales in the early days of a company’s growth, with little thought to the impact on renewals and expansions.
That leads to inevitable churn from customers where pricing was set too high, or minimal expansion opportunity when Sales included 'everything extra for free.' To change this cycle, Customer Success must play an active role in setting the company’s pricing and make periodic updates that adjust to changing customer needs.
We’d need a whole book to bring up to an expert level on pricing strategies, so instead we’re sharing the latest thinking on pricing strategy to inspire ideas and help you have a more sophisticated conversation with the CMO. Kyle Poyar, one of the most well-known SaaS pricing experts and Operating Partner at OpenView Ventures, has explored pricing models of many different companies and shared the trends with us below.
Before we pass the mic, it’s worth knowing where usage-based pricing came from. Here’s a quick overview:
Here’s Kyle Poyar with some of his latest learnings on usage-based pricing.
1. Pure usage-based pricing isn’t for every product
Even if customers are asking for usage-based pricing, some companies just don’t have a great usage metric they can use for their pricing. This pricing metric should:
Consider an online survey tool, for example. Should their usage metric be # of surveys, or does that force the customer to make a purchase decision each time someone on their team wants to deploy a new survey? Should it be # of survey responses, even though the value of a response might be very different if the respondents are B2B customers vs. free users vs. your own employees?
One way to solve for this is to mix subscription packages with usage-based pricing, similar to Zapier (screenshot below) or Cypress. The subscription packages help monetize the value of the product capabilities for different audiences. Meanwhile, the usage fee helps monetize customers as they grow their product adoption over time.
2. Usage-based pricing = compound interest
I wrote that public companies with a usage-based model are growing 38% faster than their peers. Unfortunately, that’s only half the story.
Usage-based pricing works like compound interest. It can actually be harder to reach your first $1M or even $10M with a usage model. Unlike selling fixed subscriptions that you can recognize immediately, with a usage-model you have to wait until your customer is launched, successful, and growing.
But all of that hard work does eventually add up. Growth starts to accrue naturally, just like compound interest, and your investment gets rewarded in future years.
3. Not all expansion revenue is created equally
Expansion revenue does look like compound interest from a macro-perspective. On the ground, it’s not always that simple. You should delineate your “organic” versus “inorganic” expansion and design separate motions to go after both opportunities.
* Organic expansion = your customers simply use more of your product(s). This is a by-product of customers getting onboarded, seeing value from your product, and wanting to use more of it. The organic expansion number is usually owned by Customer Success rather than Sales. As such, most companies avoid over-paying commission on this expansion after the customer’s first year.
* Inorganic expansion = your customer bought new products or added use cases / business units that were not part of the initial purchase. Generating inorganic expansion generally requires a commercially-minded Account Exec or Account Manager who partners with Customer Success. They’re building an account plan to spot untapped opportunity, asking for introductions to other teams, co-creating business cases, etc. You’ll want to treat these opportunities more like you would a new business sale and compensate the team accordingly.
4. Learn from patterns that resulted in your best customers
One of the best ways to systematically improve your organic expansion is to reverse engineer the behaviors that resulted in your best customers, then apply those behaviors to other customers.
We call this a patient zero analysis - which does take on new meaning in COVID times. It includes a deep dive on everything you know about these top customers from your existing teams, your product data, and from conversations with key champions on the customer’s side.
You might discover, for instance, that implementing SSO allowed your customer to roll out your product to their entire engineering org. Or you might discover how your customer pitched the product’s value to their executive team in a way that you can leverage for future customers. Or you might find that the customer has found innovative use cases for the product that most of your existing customers haven’t taken advantage of yet.
Ideally you’ll translate those insights into a simple checklist of milestones that the Customer Success team adopts as a standard protocol for onboarding new customers.
5. Comp should reward the behaviors you want your GTM team to drive
For many usage-based companies, their goal is to get new customers in the door with as little friction as possible. They don’t want to waste time on lengthy negotiations to maximize the initial deal size. Rather, they’d prefer to spend their time making sure that customer has successfully implemented the product and is seeing value.
Comp then needs to align with these behaviors you want to drive. You may, for instance, pay a bounty on all new lands independent of the initial deal size so that reps close deals quickly. Document the behaviors you want each team to drive, then ensure comp isn’t mismatched.
6. Align your entire company with the customer’s success
The hard work *starts* at contract close, it doesn’t end at contract close. Every day the customer is making a decision about whether to use your product, which means every day they could potentially decide to stop paying altogether.
You need to set up your entire company to do what’s in the best interest of making sure your customers are seeing value. That includes things like:
New Relic put this extremely well in their February 4th Investor Letter describing their embrace of usage-based pricing. It’s worth quoting directly.
7. Invest in tooling to help customers understand their costs & benefits
While a usage-based pricing model is inherently flexible and hard to predict, many prospective customers will want to get a handle on what their costs could look like. You’ll want to equip the field with tooling and the right qualifying questions to better understand the customer’s specific use case(s) or workload(s) for your product. That way they can educate buyers about how much to expect to pay for the proof of concept and then a potential broader deployment later on.
Extra credit if you can articulate the ROI associated with these use cases as well. Twilio, for instance, can point to the ability to reduce no-shows with SMS appointment reminders, which gives the customer peace of mind that any unforeseen usage is actually good for business and saving them money.
Bonus: Stop saying “overage”
Overage sounds like you’re penalizing the customer for being more successful than they originally planned. And it gives me 2000s-era AT&T rollover minutes vibes (but who doesn’t love this old commercial?).
Your customer grew their business and wanted to consume more of your product. That’s fantastic, celebrate it! Don’t lock their account until they upgrade or charge punitive overage fees because they didn’t make a large enough pre-commitment 9 months ago.
Instead of overage, I like to use terms like “on demand” or “flex”. If the customer’s extra consumption was one-time or seasonal, true-up the flex usage at the end of the quarter. If it’s their new normal, re-up their contract at a higher commitment and volume discount.
AUTHOR
Kyle Poyar is an Operating Partner at OpenView Venture Partners, where he helps OV’s portfolio companies fuel growth and become market leaders. Follow Kyle on LinkedIn or subscribe to his newsletter, Growth Unhinged.
Today we released the second issue of Nuffsaid’s 2.0 magazine: Customer-Led Growth.
Like our previous issue, each chapter challenges the status quo in Customer Success. Volume 2 introduces the Customer-Led Growth model — a model that companies are moving towards as they focus more on “retention” as a core metric. It explains why this means CS leaders must change how they advocate for their function, then walks through the teams, systems, and executive skills that companies require from Customer Success in this new model.
What is Customer-Led Growth?
Customer-Led Growth is an operating mode where everyone at the company obsesses over the value customers are receiving from the product.
There are three principles of the Customer-Led Growth model:
Customer-Led Growth is central to the magazine. Through 11 chapters, we’ll cover:
With heaps of new content, Q&As, illustrations, and some of the more popular pieces from our blog, we believe it’s one of our best pieces of work yet.
Hope you enjoy it.
Here’s how we used to budget for Customer Success: “I need one CSM per $2,000,000 in revenue.” But that approach was fraught with problems. Mainly, it taught the world to treat CS as a department that needed to become more efficient. That’s why your CFO squeezes your budget every year.
But in the past several years, Net Dollar Retention (NDR) has become a critical metric for investors of all types.
Private equity, VC, and public market investors are now using NDR as a key metric for overall company valuation.
Customer Success can no longer be an overhead department that has to become more
efficient over time. It’s critical that CS Leaders re-educate their CEO and CFO on
how the market now treats NDR, and then advocate for their budget by anchoring to
company value created, not efficiency.
Here’s the maturity framework most CS leaders go through. Think about where you are,
and what can be done to “move up” in your journey.
STAGE 1: At this stage, you’re advocating for budget using the basics. You’re likely using rule of thumb metrics like “One CSM per $2M in revenue” or “One CSM per xx accounts”.
Those are tools for knowing how many people you’ll need to hire each year. However,
using efficiency metrics like this puts a huge target on your department: the CFO will
think of CS as an overhead department that needs to become more efficient over time. The result: decreasing investment in CS as a percentage of revenue as the company
grows, making it hard (or impossible) for the CS leader to grow net dollar retention.
STAGE 2: CFOs often care more about growing revenue than cutting costs, so at this
stage you position Customer Success as a revenue growth function (much like Sales).
The best approach is to show how a greater investment in CS will lead to increased Net
Retention Rate. Think, “$1M additional investment will lead to $2.5M in retention rate
improvements.” This framing gets the CFO comparing the return of a CS investment to
other places where they can invest.
You can use this CS Revenue and Expense Forecast Planner as a starting point to
calculate the ROI on a greater investment in CS.
STAGE 3: The best approach to advocate for additional budget is to demonstrate how
improvements in retention rate increase the company’s valuation — the thing the CFO
ultimately cares about most.
Here’s how:
Start by forecasting the impact an increased retention rate will have on the company’s
valuation. If you don’t have your own numbers, you can use this study by
Gainsight that analyzed Bessemer Venture Partners’ Cloud Index on net retention
metrics. The conclusion is that retention rate explains about ½ of a company’s revenue multiple (EV/Revenue).
On average, we see that for every 1% point increase in net retention, enterprise revenue multiple increases 0.7x!
This has astounding implications for investments in CS. Let’s assume a company is
doing $250M ARR. Based on the chart above, if the company has a 100% retention rate,
then the revenue multiple for that company will be about 5x. Let’s see what retention
rate improvements will do to company value:
• 100% retention = 5x multiple x $250M ARR = $1.25B
• 101% retention = 5.7x multiple x $250M ARR = $1.425B
• 105% retention = 8.5x multiple x $250M ARR = $2.125B
If the CS leader can drive just a 1% increase in revenue retention, they can increase
company value by an incredible $170M. Where else can the CFO invest to see those
kinds of returns on company value?
Obviously there are other factors that impact company value like overall growth
rate projections, profitability, earnings history, management team, etc. But because
retention rate is so critical in the eyes of investors, it will play the biggest role in determining company value.
And that’s why it’s so important for CS leaders to reach this stage of the conversation with their CEO and CFO. It’s time to get away from treating CS like an overhead department that needs to become more efficient every year. Instead, it’s time for companies to make outsized investments in Customer Success to drive outsized increases in company value.
The following is an excerpt from How to Actually Influence the Product Roadmap, a new handbook that gives a blueprint for Customer Success leaders to build a better partnership with Product. You can get your copy here.
Given what we know about the process of creating a product roadmap, what can Customer Success do to actually influence the roadmap? The simple answer is this: turn Product into a raving fan. Make Product’s life easier, and they’ll naturally start to rely on you as a trusted partner.
Here’s how:
This may seem like an oversimplified magic wand. It’s not. It’s an actual plan you can implement to change the influence CS has with the Product org.
In our interviews for this handbook, we asked Product leaders “what’s one thing you want CS leaders to take away from this?” Nearly all of them pointed to one of these four common behaviors, and asked CS leaders to stop doing them:
If you’re doing any of these, stop. Yesterday. Your goal is to turn Customer Success into an asset for Product, and the behaviors above do the exact opposite. Let’s take them one by one.
*An important nuance about this list of mistakes:
A CS leader is more likely to make some (or all) of the above mistakes when it comes to the 800-pound-gorilla customer that’s coming up on renewal. Suggestions:
Mistake #1: Sharing “important” customer requests with Product as they come in
As soon as a customer reaches out with an ask, the urge is to report that immediately to Product. It feels good to help a customer right away, but it’s actually counterproductive. Product is looking for problem themes across the business. One-off customer requests almost always get lost in the ether (backlog) because Product tends to avoid solving problems because they’re “on fire” or they’re an edge case.
Mistake #2: Summarizing customer feedback in your own words without also providing the VOC source
The hard truth is that Product doesn’t trust customer requests that have been filtered through a CSM. Product Managers are better trained to read between the lines (sometimes by going and talking to the customer themselves) to discover the customer’s true problem. As a result, filtered requests are generally written off as “not enough info” unless CS is also giving Product access to quickly dive into the source information.
Mistake #3: Proposing potential solutions to “make it easier” on Product
Imagine Product coming to you with tweaks to your customers’ success plans. Totally unhelpful. That’s how it feels when CS proposes potential product solutions to customer requests. Every change made to the product requires 2-3X the planning that you’d expect, and affects many areas of the platform that Customer Success isn’t tracking. (Non-Product people often don’t realize what all goes into solutionizing. They also may not realize that the tight collaboration between Product, Design, and Engineering gives that group the ability to deeply understand the business goals, technology trends, and usability patterns.)
When CS comes to Product with solutions, it requires Product to do all the problem discovery themselves, which they don’t have the bandwidth to do.
Mistake #4: Going directly to engineering to solve “urgent” issues
This is an absolute non-starter for a few reasons:
1. The only issues that are actually urgent are bugs that prevent customers from using important features in the product. These kinds of bugs often have implications across the platform, which specific engineers don’t know about. If you keep Product out of the loop, there’s a chance the engineer you have a relationship with won’t solve the issue well. They may also unknowingly create bugs that are even more serious.
2. When you ask Engineering to do something “urgent” they have to deprioritize other work. That other work may have a much bigger impact on company goals than the issue of an individual customer.
3. And you lose all credibility with the Product team when you cut them out of the process (unless you’ve agreed on the workflow ahead of time). Once you break trust, it’s hard to earn it back.
Customer Success has exactly what Product needs: constant access to product feedback. But often, CS teams waste those customer interactions by not digging deeper into customer problems.
In order to (a) uncover problem themes that'll have an impact on the business and (b) get sufficient data for Product to create a solution, CS needs to:
This isn’t the typical “keep bugging them” advice. CS really needs to rethink the role it plays in the process of researching, understanding, and prioritizing product themes, and skill up in areas it’s sorely lacking.
Provide CSMs with user research training
User research is the cornerstone of any great Product org, and software company. It requires you to ask the right questions of a user or customer to understand what they need, even if they don’t know how to explain it.
“Customer Success teams need to take the same approach as user research teams.”
— Andrew Litvak, Senior Product Manager at Shopmonkey
There are many UX research trainings on the market, and most of them boil down to asking these 5 basic questions:
CSMs should ask these questions any time customers express frustration with the product, point out bugs, ask for new features, or simply say they’re using it less.
More often than not, what a customer says is different than what they actually need to be successful. These questions will help your CS teams uncover underlying problems for Product to solve.
General Assembly offers an online Intro to User Research course which we recommend for Customer Success teams that want to learn more.
Get actual quotes, audio, and video recordings from customers
The more context Customer Success can share with Product, the better they’ll be able to understand and solve customer problems. Ideally CS teams would record every customer interaction they have in a tool like Gong, Grain.co, or Fathom.Video, annotating each video to bookmark answers to the Job, Importance, Frequency, Blockers, and Alternatives questions above. If you’re not ready to implement a new tool, providing word-for-word customer quotes in response to those questions is a decent backup option.
Once your team starts asking customers the right user research questions, you’re going to amass a treasure trove of customer data. So much so that Product won’t have enough time to review it all. Catch 22!
CS needs to start by syncing with Product to agree on some proposed high-level problem themes. Then, CS needs to do the legwork of summarizing problem themes for Product and quantifying the value of each problem theme to the business. This includes:
Then, taking it one step further, Customer Success can identify which of these themes align to current quarterly goals before bringing them to Product.
This is the holy grail for Product teams—especially when Product can double click on each problem theme to see detailed user research questions, quotes, and videos that provide context for how the problem affects individual customer accounts. (And specifically, “who” the problem affects, so Product can see whether the feedback is coming from people who the feature wasn’t built for.)
Once you’re able to deliver this data to Product, your influence on the product roadmap will skyrocket.
If you enjoyed this chapter, read the full handbook on How to Actually Influence the Product Roadmap.
Unlike Product or Engineering teams which require deep technical expertise, Customer Success can access broadly available core skill sets: relationship building, communication, organization, resilience. And these skills are abundant across a diverse population of potential hires.
But you can scroll through LinkedIn profiles, scan conference talks, or visit any CS awards list and see that we’re not meeting that opportunity. Customer Success, especially at the leadership level, is predominantly White.
This article wasn’t written to highlight a problem, though, it was written in partnership with the CS community to share tactics that will result in better hiring, retaining, and promoting Black team members.
Before we dive in—a special thank you to everyone who contributed to this article through interviews, ideas, and feedback: Mike Lee, Cairo Amani, Shadavia Jones, Kash Young, Charles Coaxum, Ja’Rod Morris, Valerie Jones-Harvey, Keishla Ceaser-Jones, Bliss Billingsley, Katrina Coakley, Anthony Edwards, Vance Gleton, Queen Joseph, Marco Carrubba, Kalina Bryant, and Jenna Karamanos.
Important terms:
Rule of thumb:
If you’re unsure of what someone identifies as, ask them!
At a very high level, there are three areas companies can focus on:
Most teams think they should start with #2 (hiring), but the reality is that creating an inclusive environment will help you hire more people from underrepresented backgrounds. Consider starting with your existing employees first.
For the past several years, DEI has been a hot topic. But the focus is too often on “how to get more people in the door” — with less attention paid to what companies can do to include people after they’re hired.
“You don’t have diversity if you don’t have inclusion.”
Anthony Edwards, VP of Customer Success at TiLT
Our interviews identified a few of the best ways that companies can create an inclusive environment. But first, many folks noted that “inclusive” can be a nebulous word, and can only measure the inclusiveness of your workplace by asking employees what they think. There are plenty of good resources on this topic (see Culture Amp’s Inclusion Survey and HBR’s article on How to Measure Inclusiveness for example). Starting with an understanding of your employee’s perceptions will help you decide which of the initiatives below make the most sense for your team.
From HBR's article on Measuring Inclusion in the Workplace
“Non-white people don’t assume the grass is greener at a different company. They do a lot more asking around about whether or not people feel good about themselves and feel safe at work.”
Shadavia Jones, Manager - Customer Success Team at HubSpot
Here are some of the actions CS leaders can take to create an inclusive environment for immediate and longer-term change:
1. Make sure there are systems or resources in place so team members feel they can voice issues without fear of consequences.
For people at your company who don’t have a manager who looks like them: who do they go to to talk about their experiences with that manager? Be sure there are systems in place that allow team members to feel safe, heard, and know that something will be done when they talk about hard topics like microaggressions in the workplace. (There are tools available that help facilitate anonymous feedback and action from leadership—All Voices is an example.)
“Creating a sense of belonging at work is the outcome of three mutually reinforcing attributes. Workers should feel comfortable at work, including being treated fairly and respected by their colleagues. They should feel connected to the people they work with and the teams they are part of. And they should feel that they contribute to meaningful work outcomes.”
Deloitte Insights, Belonging
2. Sponsor an Employee Resource Group
Employee Resource Groups (ERGs) — groups that give employees safe spaces to bring their whole selves to the table and help in personal or career development — help bring people together to share their experiences, create connections, and together they often work to tackle company-wide challenges.
Leaders can support these groups in two notable ways: helping ERGs get the senior leadership commitment they need (if they don’t already have it), and advocating for group members to be paid for their time and effort in affecting company policy and creating change. (LinkedIn recently shifted to this model; Axios wrote about their model here which others can borrow from.) Leaders can also advocate for wider participation with the group.
ERGs tend to be employee-lead, but CS leaders can help to:
From How Reddit Uses ERGs to Create a Sense of Belonging at Work
3. Educate your organization
Companies need to educate their employees at all levels—leadership included—about:
Hiring third-party agencies for this type of education will help make sure you’re hitting the right points. And to take it a step further, look to hire agency owners from underrepresented backgrounds.
This education is not one-and-done of course—regular training will serve as helpful reminders to self-reflect, look out for bias, and find ways to use privilege for good.
Note: One resource we heard was especially helpful was this training: But I’m Not a Racist… Right? At the company where this was used, everyone took the quiz.
“We should be challenging White leadership to be aware when they are in spaces that lack diversity to think about how they can impact those from a proactive perspective. And if they can't change the make-up of the room, how do they put processes in place to break the cycles and practices of "doing it the ways you've always done?" How do White people in all White spaces put a reflective lens on their own thinking and decision-making for the good of the business and inclusivity? How can leaders use advisory panels or reverse-mentoring as a way to get more diverse points of view in decision-making?”
Keishla Ceaser-Jones, Director of Partner Success & DEIB Leader
4. Create opportunities for Black employees to be visible
Sometimes companies do a lot of work to get candidates in the door — but then those people aren’t “visible” within the organization. They’re not given the opportunity to take the lead on projects or give presentations. Managers at any level can look out for this and help hand off big projects, training, or speaking opportunities (even at the team level).
“You don’t want it to be a token gesture, like ‘Go present for me at Gainsight’ so we can show others who is representing our company… But I do think there are a lot of opportunities for companies to have people of color present internally and push them to the forefront so it becomes common to see people of color leading and presenting.”
Charles Coaxum, VP of CX at Kenna Security (recently acquired by Cisco, 7/2021)
Recruiting and hiring more Black employees takes a deliberate effort:
First: there’s a lot of research about having an unbiased interviewing process: removing names and locations from candidates in the screening process, reviewing job descriptions, doing a “blind” challenge early on.
Here are some other tips on improving your recruiting and hiring process to hire more Black employees:
1. Consider historically Black colleges and universities
Companies doing DEI initiatives usually think about recruiting from historically Black colleges and universities (HBCUs) as an early step. Two challenges to consider:
Instead, try sending a CSM or a CS manager from your team to job fairs. Talk about Customer Success and the skills people can have and learn to be successful in a CS role.
Also, some companies recruit from HBCUs but don’t consider degrees from HBCUs and other backgrounds when making hiring decisions.
Note that many Black students attend PWIs (predominantly White institutions). Look into whether your company is finding those students when recruiting there.
2. Build your presence in other communities
CS leaders can get creative here: there are communities on Meetup, Slack, LinkedIn, Facebook, and more that are great places to find candidates for CS roles. Here are some communities that have been shared with us:
Building your presence can mean giving presentations at these groups, participating in conversation, and partnering with the groups to promote career opportunities at your company.
It’s worth mentioning here the importance of hiring panels to consider Black professionals from other customer-facing backgrounds and industries outside of tech. For example, someone with retail experience would be great at Customer Success. This is a significant barrier for Black professionals to gain entry into CS; often, companies are looking for experience and recycle the same talent in the industry, which doesn't help recruit more Black professionals.
3. Slow the hiring process
Hiring cycles move fast: a business need comes up, there’s urgency, and the role needs to be filled. But depending on a company’s network, where they’re posting jobs, and the level of effort they put into increasing diversity at the top of the funnel, it’s often easy to come across White candidates first.
So CS leaders should slow down the hiring process for two reasons:
4. Be careful about hiring people from your past networks
While it's tempting to hire people you trust and have worked with before, it creates an almost impossible-to-break cycle where people from non-traditional backgrounds aren't considered for leadership roles. The majority of CS leaders are White and the people from their previous networks are often also White. How can we create change when new opportunities aren't created for talented people?
An idea here: we've heard of some companies that only provide referral bonuses to folks who refer team members who will add representation to their team or company.
An important piece of retaining anyone is giving them the opportunity to grow skills and be promoted. So beyond hiring, beyond creating an inclusive environment, how quickly do Black employees at your company get promoted compared to their White counterparts?
“You see it so often: White people get opportunities based on potential, people of color get opportunities based on experience. Meaning, a Black person would have to have already proven they can do the job before getting an opportunity, advancement, or promotion. A White person would get the opportunity based on the potential the manager sees.”
Kash Young, Director of Customer Success at Articulate
Here are some ways CS teams can do a better job:
1. Create clear career ladders and tie promotions, raises, and opportunities to those career ladders
Documenting expectations for career paths makes it clear what areas people can focus on to get to the next level. It takes some of the subjectivity out of who gets opportunities or raises. CS teams should also provide greater transparency around how much people earn in each role.
Here’s a great resource from Emily Garza on how to create career ladders from scratch.
2. Provide mentorship and sponsorship
Being a mentor is giving career advice and coaching. A sponsor is someone who calls out someone’s hard work in meetings, mentions their name, and advocates for them to take opportunities.
Both are important, and most managers are naturally good mentors. But people from underrepresented groups need sponsors to raise their names.
Lara Hogan has some excellent resources on examples of sponsorship, and how to be a good sponsor.
We asked a group of interviewees, “what’s one thing you want the audience to take away from this piece?” Here are their responses:
“Customer Success has a unique opportunity—people can come from anywhere. I’m a case study in that: I have a Marketing and Communications background, did Consulting, all those things helped me arrive at Customer Success. What a spot to be in! When you’re hiring for CS, your pool of applicants is huge, and I would argue that it’s bigger than most roles in organizations. So don’t be foolish and miss this opportunity that Customer Success has to look different from the rest of the world. I think CS is the best industry to work in so let’s be great. We need to step up to the challenge.” — Anthony Edwards, VP of Customer Success at TiLT
“Figure out ‘why’ you want to improve your team’s diversity. Look at yourself and ask, ‘Do you honestly believe that adding people of color improves your organization, your product, and helps you get to your objectives? Or are you doing this as a feel-good?’ That’s an honest question you have to answer. And then you have to ask, ‘Do I have people in those groups that are part of my life outside of work? Have I made a conscious effort to socialize outside of the office with any of those folks?’ Have you ever gone out to eat or gone for a drink with a person of color with the intent of just getting to know them? Because meaningfully engaging in the community, like mentoring, or working with different groups, and making it part of your daily life—that will help you find those candidates, and it will help you grow as a person in the process.” — Charles Coaxum, VP Customer Experience at Kenna Security (now Cisco)
“Investing in diversity is not just about the bottom line. I don’t want to see us using that as a selling point anymore. People at companies always like to say ‘Diversity is good for business.’ Yeah, it is but diversity is for humans. We need to make sure that we’re not tying the fact that we are investing in diverse candidates or diverse pipelines or diverse perspectives, to more money. Diversity is good for humankind. — Shadavia Jones, Manager - Customer Success team at Hubspot
“Put diversity into action. Just as you work with your leadership to coordinate and execute a 3 or 5-year business plan, you have to document and aggressively pursue growth plans around diversity. The current narrative is that things will sort themselves out over time, and there will be a natural path towards equitable hiring and promotions for black people (in the private and public sectors), but that has not worked. The Customer Success space is a glaring example of this gap. My charge to Chief Customer Officers and others that have a substantial level of power and influence in your organizations is to seriously rethink it holistically, work to step away from inherent bias, and approach diversity as you do other initiatives. It’s not that you have to start creating quotas for Black people within your company, but you need to do something different and think outside the box. Just as you’re going to hire McKinsey to help solve some of your pressing strategic challenges, consider a diversity consulting group, or look to the Black people amongst your ranks to think through solutions specific to your organization.” — Ja’Rod Morris, Customer Success Advocate at Tribe Strategy
“Leaders need to know there is a vast amount of untapped talent knocking, calling, and emailing. There is no better time to start the conversation, be the change needed, and in return hire kick-ass talent that can not only change the face of the company but get the results the existing customer base is yearning for. You have to hire different, do things different, and hire people who think and look outside the box.” — Vance Gleton, Enterprise Customer Success Manager at Confluent
“I want everyone to be aware of this: getting us through the door is easy. Go beyond that, and make an effort to create the environment that we want to be in. Make an effort to create the environment we can thrive in. Black people are tired of going to work and just surviving. We would like to thrive. And we would like to do so as unbothered as you get to be. It doesn’t stop at recruiting, it doesn’t stop at hiring, it’s in your practices, it’s in your people/HR team, it’s in their attitudes, and it’s on the executives too, to take in as much information as they make their employees consume.” — Kash Young, Director of Customer Success at Articulate
“The murder of George Floyd has been a catalyst: everyone wants to do something… but they don’t know what to do. I knew in my work that my focus was never going to be dealing with police brutality even though that’s central and core to what happened to George Floyd. But where is the knee on the neck of your black and brown employees in your organization? And if you can identify that space, you can work to solve that problem, but you have to see where it fits? Where does it show up?” — Keishla Ceaser-Jones, Director of Partner Success & DEIB Leader
“Know this: these conversations are uncomfortable for everyone. That’s ok. And there’s no end—we’re not trying to ‘solve’ a one-off problem, we’re trying to make life better for everyone. So if you are a tech executive; and you’re saying, ‘My product is supposed to make life better, life easier!’ This is a way for you to put up and shut up. Your product might do those things, but what about your culture?” — Bliss Billingsley, Manager of Customer Success Mid-Market & Enterprise at LinkedIn
“Exploring the world of Diversity and Inclusion is only meaningful if acting differently than what you are used to – in your habits, in your relationships, in your biases, in your opinions – and it can be a profound and life-changing experience. However, it must be approached with reverence for the risks and certainly with some idea of the journey ahead: awareness of the point of you and education on the point of others is the first noble step in the journey. Reaching the summit of sacred “belonging” could present the challenge of a lifetime and leaders, teams and organizations must be respectful of any outcome: people could equally find themselves stuck to a fake peak. The journey is not as simple as taking a few more strolls around the block! Is it worth the effort? Absolutely.
"Systematically navigating Diversity and making it the queen (or king) of any professional and personal motion is the way we can all become better, more complete humans. For those already up there the feeling of accomplishment is profound and something that prompts them to actively diffuse it to others by osmosis.” — Marco Carrubba, EMEA Director of Cloud CS at VMware & Co-lead for the Voice of DEI at Gain Grow Retain
“Your first perception of someone isn’t always honest and true to who that person is —your judgment is based on your experiences. Be open to talking to people and getting to know them. You never know what you’re going to learn and you never know who you’re really going to connect with. Don’t let first impressions about someone be your final decision about them.” — Valerie Jones-Harvey, Sr. Director of Renewal Sales at TrustArc
“People need to be a little less concerned about their own feelings and be more focused on understanding the realities people are living instead. Leave your ego and your pride at the door and have an open mind to these conversations. Also, people look at hiring diverse populations as more of a challenge than it actually is. If you do look in the places that Black people are, and you reach out, people are really open to having these partnerships. They’re not going to get rejected every single time, they just need to start. And one more thing: I don’t know about any other department that can be run without measurements and metrics that aren’t reported on a monthly basis. Increasing diversity is not about good intentions or wishes. Measure it.” — Katrina Coakley, Manager in Customer Success at Ivanti
“People need to be prepared to do the work to address and acknowledge their privilege. And use it for good. Everything starts there. White people need to be honest with themselves and build self-reflection skills. Those things are an unstoppable force when you’re in a position of power. Be aware, come from a good place, and be actionable.” — Cairo Amani, Customer Experience Lead at Cutback Coach and Cofounder of ThriveNetwork
“It’s not enough just to shine a spotlight on the issue. It's not enough just to raise awareness of the issue. There has to be a corresponding action to make things better." — Queen Joseph, Customer Success Operations Leader
DISCLAIMER: The thoughts and opinions expressed in by individuals in this piece belong to them and do not necessarily reflect the opinions of their employers.
We’ve all experienced bad meeting cultures where meetings become political tools, waste everyone’s time with information sharing, or devolve into micro management (think “weekly check-ins”). Individuals don’t like them—no one wants to be part of meetings that distract from the real work. And they’re expensive for companies, too.
But meetings are just... easy. It’s easier for someone to “talk it out” than sit down and write about the problem they’re trying to communicate. And (some managers think) it’s easier to speak up about concerns or blockers when meeting face-to-face.
So in turn, all companies eventually face meeting creep. The difference between the “bad meeting culture” companies who let it fester and the companies who don’t, is that the latter establish boundaries around when meetings should be used.
"Perhaps the CEO's most important operational responsibility is designing and implementing the communication architecture for her company."
- Ben Horowitz, Cofounder and General Partner at a16z
At Nuffsaid we’ve been intentional about our meeting culture and have used tactics I think other teams may benefit from applying. This piece is a blueprint for what we’ve done. Read it, apply the parts that make sense for you, and connect with me to share what you’ve learned.
Before I share what we’re doing at Nuffsaid, it’s useful to do an audit of where your company’s meeting culture stands. I’d recommend setting guidelines as a preventative measure, but if you
already have an established “bad meeting culture” you may need to do extra work to change the way people are operating.
To do an audit, consider making a copy of this 5-question survey to send to members of your team. Then, compare the responses to this “poor, average, excellent” scorecard to understand where your meeting culture sits.
1. What percentage of the team's time is spent in meetings every week?
20% of the average 5-day work week equals about 2 hours per day in meetings. No individual contributor should be spending more than an average of 2 hours per day in meetings. If your team responds to the survey saying they spend more than 25% of their week in meetings, consider combing through their schedule and working with the meeting organizers to see whether those meetings are necessary or if the attendee list could be shortened.
Individual contributors should aim for 10% or lower (an average of 1 hour per day in meetings), and managers should aim for 20% or lower. If organizers are required to take a hard look at every single meeting to determine whether there needs to be one, they’ll find that many are being used to share information or get approval—both of which can be done via email. And some won't have a purpose or agenda at all. Kill those meetings.
And for the meetings that survive, organizers must consider the time allotted per meeting. Parkinson’s Law says that work expands to fit the time allotted. If your meeting is scheduled for an hour, it’s probably going to take an hour. If it’s scheduled for 30 minutes, you’ll figure out a way to get everything done in that time. If organizers cut all their meetings in half, they’ll be surprised how much value they still get from the shorter meeting.
2. What is the primary purpose of meetings at your company?
Meetings often focus on one of the following categories:
As most companies grow, in an attempt to keep everyone included about what’s happening, they focus their meeting time on sharing information. Unfortunately, meetings are an extremely inefficient way to share information for large groups since much of the information won’t be interesting or relevant for much of the audience. It’s the meeting organizer’s job to find other ways to distribute relevant information to the right people. An effective example we’ve seen is when managers direct message (in Slack) every person on their team who needs an important piece of information.
In an excellent meeting culture, the primary purpose for meetings is to make decisions or remove blockers.
3. Except for all-hands and department meetings, how often do meetings have more than 5 attendees?
Except for company or team all-hands, meetings should rarely have more than 5 people in attendance. If your meeting is focused on something productive, like making a decision, then it’s difficult to hear everyone’s perspectives and allow room for debate when too many people are in the room.
Sometimes when meetings have more than 5 attendees it’s because there are some people who have been invited for purely political reasons, like to have a department presence with no goal of how that person should participate. It usually sounds something like this: “We should get Alison from Product to attend this meeting.” Or, “I should attend this meeting so I’m visible to Andrew.”
When attendance is political and not about getting value out of a meeting, it’s a sign there are some deep-rooted issues and fixing your meeting culture may be a step in the right direction.
Here’s how we’re doing it at Nuffsaid, in the hopes that you’ll use this blueprint for the benefit of your team.
When starting Nuffsaid, I knew I’d want to protect the team’s time from meeting creep as we grew. So my co-founders (Hari and Nick) and I created a rough outline of meeting guidelines that eventually was refined to the following:
Core to our guidelines are what we don’t use meetings for, how we think about recurring meetings, and why we help team members prepare.
We don’t use meetings to share information or get approval. There’s no reason to get everyone together for status updates or sharing context. They can be easily managed over chat or email.
We bundle all recurring meetings on the same day, when possible. I wholeheartedly agree with Paul Graham’s argument in Maker’s Schedule, Manager’s Schedule that makers need large chunks of uninterrupted time. It’s difficult for the human brain to switch our working mode quickly, especially when shifting our focus from meetings to deep work. So companies should encourage bundling meetings closely together, leaving long stretches of uninterrupted time to get the actual work done.
One of the ways we accomplish this at Nuffsaid is by scheduling all recurring meetings on Wednesdays. The actual day doesn’t matter as long as everyone agrees to the same day.
We share an agenda at least 24 hours before the meeting. This behavior is more important than it may initially seem. Some people don’t perform as well in meetings because they don’t process information on the spot by talking things out. These team members may prefer to think about a topic ahead of time, come up with an opinion, and then share that point of view with the group.
Individuals who operate this way often have the most elegant solutions to problems, just not under pressure. It’s in the company’s best interest to hear from all the voices of a team, not just from those who think well on their feet.
We assign ownership for the company’s meeting culture. As the company scales, the problem of meeting creep will be more persistent. Someone needs to be accountable for vetoing recurring meetings that aren’t useful—as a startup, that’s probably the CEO. As the company grows, each department should assign owners over this responsibility.
And we follow some basic Zoom meeting etiquette expectations. Because our main human connection to each other happens over video, it’s very important that we adopt these simple standards for online meetings:
If your company is doing a good job of protecting you from useless meetings, it means any meeting you're invited to is actually valuable. You are there for a reason, so it's important to focus and be involved.
If you’re not getting value from a meeting, let the meeting host know and consider skipping future meetings.
Because of Nuffsaid’s mindful meeting culture, we spend more time doing actual work than many other companies.
The downside, though, is that people can feel disconnected from their team and company in a remote work environment. If you spend all your time working and not in meetings, naturally there will be fewer chances for interaction.
This is something I'm monitoring. Given that we've been in business a few years and I have not seen any signs of this, I would say it's only a risk if not well-managed.
Here's how we're offsetting the risk of people feeling disconnected:
We offset the risk of team members feeling detached from their peers by keeping a steady flow of other ways to stay connected that aren’t typical meetings.
For one, we hold a weekly company huddle and monthly 1:1s.
We use the company huddle to discuss progress and organization-wide news. Customers are invited to the huddle in the form of customer feedback, and we share videos of feedback from user tests.
Everyone in the company has monthly 1:1s (internally called “Syzygies”—here’s the format for those). We made our 1:1s monthly so they don’t become monotonous or time-consuming for either party. Feedback should be shared continuously and 1:1s aren’t for status updates, so meeting monthly to discuss career goals, engagement with their work, and broader company feedback works.
We host fun gatherings. We do team "social meals" monthly, and weekly "water coolers."
The monthly team meal (sometimes we do breakfast, other times dinner) is a time where everyone that wants to join can catch up on each other’s lives outside of work. The meetings are structured so everyone participates and discusses the same topics. Past topics include “What book or show are you into these days?” and “If you could do it all over again, what career path would you choose?” Last year before the holidays I asked everyone to share some of the best gifts they’ve received or given. I got some good ideas out of that one. And another: early on during the Covid-19 outbreak, I asked for everyone’s take on whether we should go remote permanently. The majority of the team said yes.
The (optional) water cooler meetup happens every week so employees can chit-chat about anything. They’re intended to be a place for banter and camaraderie-building.
When meetings are used appropriately, they are indispensable tools for communication. But if they’re misused, the whole company suffers. So as a rule of thumb, for every hour of time we spend in meetings we should spend another hour preparing to make sure that time is well spent.
The importance of being intentional about meeting culture cannot be overstated. Done well, meetings are extremely effective, allowing for large decisions to be made and blockers to be removed. Done poorly, meetings are thieves that rob people of time that would otherwise be spent getting things done.
This article is part of our 2.0 Leadership Series, where we provide practical insight into what strategic Chief Customer Officers are doing so the rest of us can level up more quickly.
It was 2008 when Jeb Dasteel was named Chief Customer Officer at Oracle, after leadership roles in Sales, Consulting, and Customer Programs at the company for 10 years. “I didn’t know a single other CCO at the time,” he recalls. “Everything we did, we had to make up as we went. Trial and error. We did some smart things and some dumb things, but by and large, we were successful and learned a lot along the way. I’m enormously proud of what my team accomplished.”
Jeb left Oracle in 2019 and now advises CCOs on how to refine their customer strategy. He notes that especially in the past two years, he’s impressed with the quality of modern CCOs — but CCOs and CS leaders broadly still have gaps to fill to become an established member of every executive team.
In this interview, Jeb gives his perspective on the role of the CCO in large organizations and working with enterprise companies. He offers a unique perspective on why too many CCOs fall into the trap of being too tactical, and shares advice for CS leaders looking to become more influential (and why helping Sales close deals is critical to that).
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Chris: VPs and CCOs at small and mid-sized companies often haven’t seen how their role would change at a larger company, but they want to be eligible for those positions. Can you talk about what a CCO at an enterprise company is responsible for?
Jeb: This is a difficult question to answer because a big challenge CCOs face is variation—on how they’re measured, what they are responsible for, and what Customer Success owns. Every company has a different formula for who they think a CCO should be and what they should do.
But what I’ve seen is that most CCOs who struggle at the enterprise level do so because they’re too tactical and process-oriented. They haven’t developed the strategic, long-term company and departmental vision required of top executives. CCOs who are too tactical have a tough time both engaging with their executive peers, and working through what their role entails versus the Sales or Marketing org.
A lot of CCOs get a bad reputation because they come in, there's no clear remit for them, there's no moment where they work with the CEO to carve out specific responsibilities and goals for the CCO to own. It just doesn't happen. So CCOs are left to figure it out by themselves, without the CCO aircover to get it done. I can understand why there's a constant land grab of trying to beg, steal, and borrow resources from other departments.
The CCO role needs to be simplified and streamlined. That’s why I often coach CCOs to consider 7 elements that in various combinations should define their role. I tell them to pick the areas that matter to the business but to be intentional about what they choose to own or not to own. And regardless of what a CCO chooses to be responsible for, the most important piece is that there is a model in place that they, and the company, can follow.
Chris: Can you outline the 7 areas CCOs should consider when building out their role, and describe what it would look like in practice to focus on each element?
Jeb: Absolutely.
1. There’s Customer Acquisition, meaning bringing new customers on board.
A large part of the CCO’s job is to help the organization, team by team, rethink their job to strike the right balance between acquisition and retention. A few of the ways a CCO can drive acquisition are through market and customer segmentation, an onboarding process for new customers, and working across the organization on setting Service Level Objectives (SLOs). New customer acquisition is also heavily influenced by the CCO through customer marketing content.
Example metric: New logos or new customer count by geography, product pillar, etc.
2. Then there’s Customer Retention, or keeping customers.
Example metric: Net Revenue Retention (NRR) or churn rate.
3. There’s also Customer Ease of Doing Business. The orchestration of all of the various aspects of customer care or success is heavily involved here, as is cross-LOB coordination of all other customer interactions. The CCO should play a heavy role in developing and standardizing account management practices and other things that have a big effect on customer effort or friction.
Examples of ease of doing business issues that come up, again and again, are contracting and billing, in addition to account management. Removing friction or unnecessary customer effort can literally change the lives of your customers at a personal level. Nobody wants to be embroiled in invoicing, day after day.
It should be the CCO’s role to work across the organization, including back-office functions, to help the organization understand how process complexity affects customers and how that, in turn, affects your own business metrics (meaning, if it takes forever to get through contract negotiation, your customers will be annoyed and less likely to continue to do business with you). The give and take on this is inherently between your desire to mitigate risk (which almost always creates complexity versus the value of making interactions easier and more accommodating to customers.
Example metric: Process cycle time reductions or customer feedback on satisfaction with specific interactions (contracting, billing, working with your account team, etc.).
4. There’s Customer *and Employee* Engagement, meaning how you systematically bring customers into specific programs that enrich the relationship between you and your customers and help them attain business outcomes through co-creating of value.
Also, getting your own executives more involved with customers is critical to developing empathy for customers and generally building important customer relationships outside of the day-to-day transactions and interactions.
Engagement program examples include:
Example metric: We experimented at Oracle with an engagement index, wherein we identified specific programs and then simply looked at the top customer segments and counted the programs that each customer was engaged in. This worked well, was a good leading indicator, and was pretty easy to implement.
*Note: Employee engagement drives customer engagement and customer engagement drives pretty much everything else, ranging from retention, to adoption, to value realization, to advocacy.
5. Customer Adoption is helping customers progressively increase the use of your products and/or services and increase the uptake on product updates.
Customer Success programs are generally organized around those objectives. Also, cross-sell and upsell efforts contribute. I further propose that the CCO contributes to or drives the development of sales enablement tools and programs, which in turn affect customer product adoption (and all of the other things mentioned earlier).
Example metric: Speed of product adoption from whatever starting point you choose: when the deal is signed or when the customer goes live with the product (from a technology example). This is generally the percentage of the addressable customer employee population who is using the product over time. Same thing for how quickly product updates are consumed.
6. There’s also Customer Value, which is all about targeting, tracking, and measuring the value that the customer realizes in buying and using/deploying your products.
Example metric: The net financial benefit (e.g., cost-saving or net-new revenue) created by a customer or a sample of customers by whatever segment you choose - geography, product category, functional domain, etc. In a B2C environment, this would probably be more about tracking sentiment.
“When you can show customers that they attained their desired business outcomes, they will stand in line to advocate for you. Full stop.”
7. Finally, CCOs should consider Customer Brand Advocacy—essentially customer references but done in a highly proactive way. It’s the CCO’s job to develop and execute brand advocacy by proactively identifying and developing the most impactful customer brands that will contribute to the value of your own brand. When these brands are identified you can then develop an engagement plan that systematically helps the customers to be successful, meaning getting them to achieve measurable business outcomes. And when you can show customers that they attained their desired business outcomes, they will stand in line to advocate for you. Full stop.
Example metric: Pick the ideal 100 customers whose brands would make the biggest impact on the value of your brand. Then measure over time when each customer becomes an active brand advocate and how long it took to get them to that state. That is the quantity-oriented measure; a more quality-oriented measure is to look at exactly how each customer is advocating for you (e.g., helping you sell; doing advertising for you; speaking at conferences for you; advocating in peer-to-peer settings). You can also look at what advocates are doing proactively (without you asking) versus what they do when called upon.
Chris: How can a CS leader know if they’re too tactical and not strategic enough? Are there any common pitfalls that would reveal a leader is being too tactical?
Jeb: There are two dimensions here. There's tactical versus strategic and process versus results. I think you're too tactical if you're more process-oriented than you are results-oriented. And the symptom that reveals being too process-oriented is that you're not focused on the results for your own organization by focusing on your customer's results.
To me, there are two litmus tests to understand if you are an effective CS leader:
1) Whether you are actively engaged with the Sales organization to drive business.
2) Whether the customer feedback being collected and analyzed is being actioned upon, with tangible results that correspond to measurable business outcomes for your customers and for you.
If it's a “no” to either of those two, if for example, feedback is just fodder for interesting conversation, it’s a complete waste of time. Actually, it’s worse than a waste of time—it's counterproductive. You will be labeled as a person who does some “interesting stuff,” but never delivers any real outcomes or results. I’m all in for philosophies and theories on Customer Success, but at the end of the day, it has to yield something tangible for your two most important stakeholders: your customers and your company.
Chris: How can a CCO level up their influence on the executive team?
Jeb: I found that the single best thing to do to be influential as a CCO was to build street cred—particularly with Sales and Engineering. And building street cred meant getting engaged with deals. I would not have been successful at Oracle doing anything as a CCO had I not actively engaged with the Sales organization to close deals.
Every CS leader should spend a significant part of their day being an executive sponsor for important accounts and being actively involved in deals. We have a responsibility to help drive revenue for the company.
If your job is mostly about doing journey mapping (which by the way is emblematic of focusing on the minutiae of process improvements when the customer can generally tell you beforehand exactly what’s broken), I just don't think that you'll be able to make a real impact on the business and you won't be taken seriously as a real strategic leader. Journey mapping has its place, but every single organization I have worked with actually has a good handle on what’s working and what’s not working. The trick is to speak with the right employees and the right customers to validate this, maybe do some very targeted process assessment, and then move quickly into fixing the problem. Fast results will trump the most attractive process diagram every day of the week.
Chris: That might be the best advice I've heard in a month, which is if you want to drive influence at the executive level, help close the deals.
Jeb: Exactly. Get off your ass and get on an airplane. And I'll tell you what, this was by far the most rewarding part of my job. After essentially 100% of Oracle's products became available as a cloud service and we had CHROs, CMOs, and CFOs as customers, the principal person I worked with for 21 years when I was at Oracle was the customer’s CIO. If I knew 100 CIOs around the world, I always felt a responsibility to maintain those relationships, advocate for those customers, and help drive business because of those relationships. And, by the way, if those 100 customers called me with a problem, the whole Oracle organization kicked into gear. That wasn’t my doing; it was part of the fabric of the company to do this.
"There's literally no substitute for engaging with customers."
So I made it my job, and I know this term dates me, to be the human Rolodex for the top 100 CIOs globally. Because my job was to know them and have a relationship with them so I could call them up and have a conversation. There were so many times when a rep would say, “Hey, can you call this CIO? I don’t have that kind of relationship with them.” And I would become an executive sponsor for many of those customers.
Now, I couldn’t be an executive sponsor for every account, but I could get on airplanes four or five days a week, cover a lot of area, and be a valuable resource by putting myself and my team in the position of doing a warm handoff and setting the relationship up for success.
I believe every CCO should operate that way. There's literally no substitute for engaging with customers.
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