Customer success: From support function to revenue-driver

This article is based on a presentation given by Franca Sofia at the Customer Success Festival London, 2023.

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Customer success is being redefined within organizations globally. From what traditionally has been viewed as a mere support function, we're elevating it to become a pivotal driver of revenue growth.

While customer success was borne out of the well-known customer support function and does work with this function closely, it’s not just about support – it's all about growth. Customer success is about understanding the needs of your customers and ensuring they achieve their desired outcomes through your products or services. This transformation requires a shift in mindset, from reactive support to proactive success management.

In this article, I’m going to show you how to unlock the full potential of customer success and setting the stage for a future where support functions are not just necessary but are vital drivers of growth.

The evolution of customer success

When transforming customer success into a revenue-driving engine, it’s crucial to understand the evolving landscape. The business world is continuously transforming, and with it, the role of customer success has shifted from a support function to a core strategic asset.

But what does this transformation entail, and how does it affect our approach to customer success?

Gone are the days when customer success teams could afford to be merely reactive. Today, being proactive is not just an advantage – it's a necessity.

Our goal is to be the driving force behind revenue, not just a supporting player. This shift demands a profound change in how Customer Success Managers (CSMs) operate.

The pressure to actively contribute to revenue generation has never been higher. This reflects a broader trend in which the expectations placed upon customer success teams have expanded dramatically.

Customer expectations are at an all-time high, competition is fiercer than ever, and data and technology have become indispensable tools in our arsenal. These challenges, however, come with a silver lining. The elevated role of customer success within organizations has endowed us with significant influence, power, and the opportunity to make a tangible difference.

Customer success is no longer seen as just another department; it is now recognized as a key strategic asset. This recognition gives customer success teams unprecedented influence over the direction and success of their organizations.

With this influence comes the responsibility to harness it effectively, ensuring that we contribute meaningfully to our organizations' growth and success.

Understanding the importance of this transformation is crucial for any organization looking to thrive. The shift towards a proactive, revenue-driving approach in customer success is not just beneficial – it's imperative. It's about leveraging every opportunity to enhance customer experiences, meet and exceed expectations, and ultimately drive growth through strategic customer engagement.

Why customer success is a necessity, not a choice

The significance of customer success has transitioned from a mere trend to an absolute necessity. This change in perception isn't optional; it's a fundamental shift that's been accelerated by global challenges like the COVID-19 pandemic.

Organizations and leadership now recognize the critical role customer success plays – not just in supporting customers but in actively driving revenue growth.

One of the most crucial learnings from my journey is the importance of aligning the goals of the customer success team with the overarching goals of the organization. This alignment is not a destination but a continuous journey toward realizing our vision for customer success. It’s about understanding that achieving these goals takes time and persistence, and it's about seeing this endeavor as a journey rather than a final destination.

13 Proactive strategies for customer success

Transforming the customer success function into a proactive growth catalyst involves several key steps – 13 to be exact.

Defining clear objectives

The first step is to define clear, actionable objectives that align with the broader goals of your organization. These objectives can range from improving net revenue retention and reducing churn to setting visionary goals for your team, such as becoming a growth engine within the organization.

Segmenting customers

Understanding which customers to focus on is critical for effective customer success management. Segmenting your customers allows you to identify those with the most growth potential and tailor your strategies accordingly.

Customer journey mapping

A key exercise I've recently undertaken involves mapping out the customer journey at an organizational level. This isn't limited to customer success but involves collaboration across departments.

Through this comprehensive approach, we've identified significant gaps and outlined steps necessary to guide customers from initial awareness to long-term loyalty. This mapping is not just beneficial for improving onboarding and renewal processes but also provides a holistic view of the customer experience across the organization.

Leveraging data

Prioritize getting your data straight.

Enhance your data quality and ensure that all your systems are well integrated. This is crucial because, in the realm of customer success, working in isolation is not an option.

Our strategies and tools need to seamlessly integrate with CRM systems and other platforms we use. This integration facilitates a holistic view of customer interactions and behaviors, enabling us to make informed decisions and tailor our engagement strategies effectively.

Customer education and engagement

Customer education is often a challenging area, especially when dealing with complex products or services. It’s imperative to ensure that customers not only understand but can also advocate for our offerings.

This requires us to invest in enabling our customers, providing them with comprehensive knowledge and tools to use our products or services efficiently, thereby reducing their dependency on our support teams.

Shifting from a reactive to a proactive stance in customer engagement is vital. Regular, meaningful contact with the right customers is essential. This is where the prior emphasis on data and customer segmentation becomes invaluable. Identifying and focusing our efforts on customers with the most potential allows us to optimize our resources and enhance the impact of our customer success initiatives.

Fostering cross-functional collaboration

Cross-functional collaboration is another cornerstone of an effective customer success strategy. As customer success increasingly influences revenue, it gains visibility and the ability to prioritize initiatives across different departments.

My experience has shown that working closely with marketing, finance, revenue operations, sales, support, product management, and development fosters a culture of continuous exchange and mutual support. Such collaboration is indispensable for driving comprehensive growth and success.

Initiating revenue expansion

Understanding how to guide teams towards revenue generation is crucial, especially if they lack the necessary skills or clear directives. As leaders, it's our responsibility to define revenue expansion initiatives and communicate these strategies effectively across our teams.

Measuring performance

Measuring performance is paramount –– not just the performance of our customers but of our teams as well. Establishing clear metrics such as gross revenue, net revenue retention, and churn rates helps in setting targets and tracking progress.

Providing teams with accessible dashboards that offer real-time insights into individual, regional, and market performance reinforces a culture of accountability and continuous improvement.

Transforming customer success from a support function to a growth engine involves a multifaceted approach. It requires us to leverage data and analytics, prioritize customer education and proactive engagement, foster cross-functional collaboration, initiate revenue expansion strategies, and rigorously measure performance. By implementing these strategies, we can drive our organizations towards sustained growth and success.

Customer feedback loop

An effective customer feedback loop is paramount. It's about ensuring that insights gleaned from customer interactions are not only heard but also acted upon. This feedback needs to find its way back to relevant departments – be it product development, support, or marketing.

However, it's essential to act as both an open gate and a gatekeeper, filtering the feedback to ensure only pertinent information is passed on to avoid overwhelming teams with noise. This selective transmission of customer feedback is crucial for making informed adjustments to products, services, and strategies.

Continuous internal training and development

As your customer success team evolves into revenue-generating wizards, it’ll become evident that new skills and capabilities are required. The transformation journey is not just about external strategies but also about internal growth and development.

Recognizing the gaps in skills within your team and addressing them through continuous training and development is essential for keeping your team motivated and prepared for the challenges of this new role.

Leveraging customer advocacy

A well-structured customer advocacy program is a powerful tool in this transformation. Working closely with marketing and other departments to identify and utilize customer advocates can significantly enhance your brand's visibility and credibility.

These advocates can be instrumental in various capacities, such as participating in conferences, webinars, or even serving as references for potential new customers. Documenting success stories, identifying industry-specific advocates, and leveraging their experiences can add substantial value to your brand and contribute to your growth strategy.

Scaling for success

A crucial aspect of transformation is scalability. As your team and initiatives grow, it's vital to ensure that the processes and strategies in place can adapt and expand accordingly.

This year, my team doubled in size, presenting a significant challenge in scaling not just within the customer success department but across the entire organization. Anticipating and planning for growth ensures that your strategies remain effective and sustainable, regardless of scale.

Measurement and optimization

Finally, consistent measurement and optimization of your strategies and processes are essential.

Establishing clear metrics for success allows you to track progress and identify areas for improvement. By measuring the effectiveness of your transformation efforts, you can allocate resources more effectively, address bottlenecks, and continuously refine your approach to drive better results.

Key strategies for customer success as a growth engine

As we delve into transforming customer success into a component of growth within organizations, it's essential to highlight some key strategies that underpin this transformation.

These strategies are not just foundational; they are transformative, enabling customer success teams to act not just as support entities but as proactive growth drivers.

Multi-dimensional customer health scoring

The concept of customer health scoring is familiar to many, but the approach needs to evolve. I advocate for a multi-dimensional customer health scoring system that goes beyond simple metrics. This approach allows us to pinpoint the origins of challenges more accurately when a customer's health score declines.

Automating responses to changes in health scores ensures that action is taken promptly, guided by both the cause of the change and recommended next steps. This proactive stance empowers customer success managers to address issues before they escalate, aligning intervention strategies with specific customer needs.

Forecasting and predictive analytics

The power of forecasting and predictive analytics cannot be overstated. By forecasting, I mean anticipating how customer engagements might evolve in the coming quarters, including renewals, churns, reductions, or upsells.

This forward-looking approach enables customer success managers to plan strategically, focusing efforts where they are most needed to mitigate churn and capitalize on upsell opportunities.

Predictive analytics takes this a step further by providing insights based on customer behavior and usage patterns. Alerts about unusual behavior or changes in product usage allow teams to intervene effectively, possibly by offering additional training or support. This "work smarter, not harder" philosophy leverages technology to enhance efficiency and effectiveness.

Retention programs

While today's theme focuses on growth, retention remains a critical component of any growth strategy. Implementing a well-defined retention program is essential. This program should be closely tied to your customer journey mapping, providing clear steps for engagement and support throughout the customer lifecycle.

Measuring the impact of your retention program on key performance indicators, such as gross revenue retention, provides valuable insights into its effectiveness and areas for improvement.

Incentives for customer success teams

Lastly, the role of incentives in motivating customer success teams cannot be overlooked. Often, sales teams are the primary beneficiaries of incentive programs, leaving customer success teams under-recognized.

Ensuring that your customer success team is adequately incentivized for their contributions to revenue growth is crucial. This not only boosts motivation but also aligns team efforts with organizational goals.

In my organization, we share existing business targets with the sales team and continuously ensure that our customer success team receives the recognition and rewards they deserve for their contributions.

These key strategies – multi-dimensional customer health scoring, forecasting and predictive analytics, retention programs, and proper incentives— are integral to transforming the customer success function into a growth engine. By implementing these strategies, customer success teams can significantly impact their organization's growth trajectory, moving from a support role to a central driver of revenue and customer satisfaction.

Navigating challenges in transforming customer success

The journey of elevating customer success from a support function to a growth engine is fraught with hurdles that require persistence, innovation, and strategic navigation.

Breaking down organizational resistance

One of the most significant barriers to transformation is organizational resistance. This can stem from leadership, peers with differing priorities, or entrenched departmental silos. Despite having leadership support in my case, the challenge lay in securing collaboration across departments.

Success in this area required a clear value proposition —demonstrating not only what I needed from them but also what they would gain in return. This process of negotiation and persuasion is crucial for breaking down barriers and fostering a culture of cooperation.

Addressing legacy systems and data quality

Another hurdle is the limitation imposed by legacy systems and the ongoing struggle with data quality. The vision for a transformed customer success function often runs ahead of the capabilities of existing systems.

Regular meetings with data and operations teams are essential to brainstorm solutions for improving processes and data quality. Without addressing these foundational issues, scaling and advancing the transformation agenda becomes increasingly difficult.

Upskilling the customer success team

The transition from a reactive support role to a proactive, growth-oriented mindset doesn't happen overnight. Addressing skill gaps within the team is a critical step that may involve upskilling, reskilling, or sometimes even hiring anew.

This transformation requires a combination of internal coaching, leveraging external resources for training, and a commitment to continuous learning. It's a journey of enabling the team to adopt a balanced sales and customer success approach – what my team humorously terms as "undercover sales."

Mastering effective communication

Finally, effective communication is paramount, not just organization-wide but within the customer success team itself. In a large team, ensuring that every individual understands their role in the transformation process and how it impacts their daily work can be challenging.

Leveraging the skills of a communication manager and continually refining communication strategies are key to ensuring that everyone is aligned, informed, and motivated.

Transforming the customer success function into a growth engine is a complex but rewarding journey. It requires overcoming organizational resistance, addressing the limitations of legacy systems, bridging skill gaps, and mastering effective communication.

Each of these challenges offers an opportunity for learning and growth, both for the individual and the organization. By navigating these hurdles with determination and strategic insight, we can unlock the full potential of customer success as a driving force for growth.

Best practices and learnings from transforming customer success

I've encountered numerous challenges and gleaned several best practices for transforming customer success into a significant growth engine.

Here are some key learnings and strategies that have significantly impacted our success:

Embrace automation

One of the most impactful changes was the introduction of automation to alleviate the burden of manual, redundant tasks from my CSMs.

By automating campaigns, setting up triggers, and implementing playbooks that activate with specific changes – be it in product usage, CRM updates, or backend modifications –we've been able to focus our human resources on tasks that truly require personal attention.

Automation is not just about efficiency; it's about enabling your team to dedicate their time and efforts to where it matters most.

Divide and conquer

Segmentation is crucial, not just in how we approach our customer base but also in the internal organization of our team. By assigning specific areas of expertise within my team, such as product knowledge, event coordination, and C-level communication, we've streamlined our processes.

This division of responsibilities not only lightens my load as a leader but also empowers my team members to take ownership of their domains, enhancing collaboration with other departments like marketing, who know exactly whom to contact for specific needs.

Keep an eye on the numbers

Transparency and real-time visibility into performance metrics are vital. My team has access to a dashboard where they can monitor their performance and the impact of their actions on the company.

While some may argue this could create pressure, I believe in the importance of transparency. It fosters a culture of accountability and motivates the team by clearly showing their contributions to our collective success.

Ensure alignment and awareness

Maintaining alignment on priorities within a large team can be challenging. It requires constant effort to ensure everyone is focused on the same goals and understands the company's strategic direction.

Regular check-ins and adjustments are necessary to keep the team aligned with both my vision and the broader organizational objectives. This continuous realignment is critical for maintaining coherence in strategy and execution.

Foster a culture of continuous learning

Finally, the emphasis on continuous learning and excellence, especially among high performers and team leads, has been instrumental in scaling knowledge and expertise throughout the organization.

By investing in the development of these key individuals, we've been able to elevate the entire team, spreading best practices and innovative strategies across the board.

Envisioning the future of customer success

As we look towards the future of customer success, it's essential to recognize the evolving role and potential of customer success teams in shaping the trajectory of business growth.

The analogy of being an architect resonates deeply with me. In this role, we're not just participants in the business ecosystem; we are actively drafting and designing the future of growth.

This perspective elevates the role of customer success beyond support or service – it positions us as central to the strategic planning and execution that drives business forward. Our decisions, strategies, and interactions directly influence the blueprint of our company's growth, making us indispensable to its realization.

AI and predictive analytics are no longer just buzzwords or futuristic concepts; they are here, transforming how we interact with customers and predict their needs. The integration of AI into customer success processes allows us to hyper-personalize customer experiences and anticipate needs before they even arise. This technology enables us to be more proactive, efficient, and impactful in our roles, ensuring that we can deliver value in unprecedented ways.

The role of a change agent is inherently tied to the customer success profession. We're at the forefront of driving organizational change, not just for the sake of change but for continuous improvement and adaptation.

This adaptability is a core strength of customer success, allowing us to navigate and thrive amidst the ever-changing business landscapes. By embracing this role, we inspire and catalyze change throughout the organization, promoting a culture of innovation, resilience, and growth.

The future of customer success is bright and laden with opportunities. By seeing ourselves as architects of business growth, leveraging the power of AI and predictive analytics, and embodying the spirit of change agents, we can drive our organizations to new heights.

Final thoughts

The transformation of customer success into a growth engine is an ongoing process that demands strategic planning, a focus on data and analytics, and a forward-looking vision. By adopting the tactics outlined in this article, you can ensure that your customer success function not only supports but significantly drives your organization's growth and success.

Enjoyed Franca’s article?

Did you know this article is based on an awesome keynote presentation Franca gave Customer Success Festival London 2023? If you're more of an audio learner, you might be interested in listening to the full video OnDemand.

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