There are a lot of performance metrics that a company can use to measure the value of its Customer Success group. Some look to NPS or CSAT scores. Customer Health Scores are another measurement tool. Others focus on churn rates, and/or expansion revenue generated. Demand generation passed to Sales is one view. Customer utilization of the features and functions set of the application can also be monitored, with points for increase thereof. While I’ve not encountered any, there probably are companies that authentically manage Customer Success on a P&L basis. All of these can have their values and use, but there is another point of view that is not often considered: The Customer’s Metric.
How Do Your Customers View You?
Have you asked your customers how they measure the worth of your Customer Success group? If so, how did they respond? (I did a research survey on this point a few years back, and the majority of the responses weren’t pretty.) I once proposed a Customer’s Metric for Customer Support, stated as: “”Quickly connect me to a courteous, competent agent that can completely resolve my issue in the shortest amount of time.” (It’s important to acknowledge the foundational reality for that metric: that there is no economic value for anyone in a Support case, and therefore the best support call of all was the one that never happened because the product didn’t generate the need for it. But there had better be some tangible economic value for both parties in a Customer Success interaction.) What would a Customer’s Metric for Customer Success look like?
Foundations for Customer Success Metrics
Heres another pertinent slice of reality. Any complex and powerful tool necessarily requires the user to make an investment in learning in order to obtain the promised value from their purchase. Do your customers really understand that about your technology? With all the hoopla about AI these days, one thing stands out to me: people are being conditioned to view AI as a magic answer to everything. Let the machine do the thinking and the work. Is that true of your customers? Have they been encouraged to believe that your technology will easily solve all of their problems? If so, your customers are being set up for some rude awakenings — and your CS team for some difficult conversations.
Let’s assume that your customers do understand that there is a learning curve inherent in your product. Then how about this for The Customer’s Metric for Customer Success: “Anticipate my need for guidance with your product and be there just in time to help maximize my company’s productivity and profitability.” That’s the beginning point for a lot of very important decisions about the process metrics for your Customer Success group. It starts with Detection: How will we know when a customer is ready for guidance? What will that guidance look like, and what’s the most effective channel to deliver it? How will we measure the effectiveness of that guidance? Is there a cheaper way to deliver it? What resources will be necessary for our CS group to have? Costs?
Metrics and Capacity / Staffing
Ed Powers of Service Excellence Partners and I are working on a webinar for next month to look at a core issue of the Customer’s Metric: staffing capacity. While some might think that Lemkin’s Rule for CS staffing (X amount of revenue per CSM) has applicability; stop. You can’t do science (or effective management) on loose generalities. You’ve got to have solid data about your product, customers, and CS team. How will you get it? Let’s talk.
