Build the team of today and tomorrow

 

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What do you do during the week you’re not attending your company’s user conference?

Catch up on reading?

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Exercise?

Ali

Hang with the dog?

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Yes, yes, and yes.

I wasn’t in attendance at this week’s Oracle’s Modern Marketing Experience (MME) conference in Las Vegas (long story) but I was still busy researching, writing, and having conversations with people like any other week. I also made the time to watch the live-stream of the MME keynote sessions from 3124 kilometers (or 1941 miles) away. This post will not be a summary of the event so change the channel if that’s what you expected. Instead, I want to pull out a couple of threads from those keynotes and weave them into a theme I’ve been discussing in recent posts.

Still with me? Okay, let’s see how this goes.

First, Steve Krause, Group VP of Product Management for Oracle Marketing Cloud (OMC), shared how the company is introducing artificial intelligence (AI) into the OMC platform. It’s exciting news but hardly surprising. Oracle is not alone in pursuing AI as a tool to augment its solutions and to improve the experience it delivers to customers. AI is seeing an industry explosion of investment and in growth in the sheer number of ideas for its application. In commercial business alone AI is taking on greater relevance because it is seen as an accelerant for future growth as is explained in this report  by Accenture. The flip-side of AI’s promise of more intelligent and responsive products is that it will improve internal efficiency too. Transformation in multiple dimensions that benefits customers and employees. How? By offering up exponential opportunities to innovate through the leveraging of new ideas that result from AI. It can be difficult to imagine the unknown but simply put, that’s what we have with AI in the business world. We’re seeing it in its infancy and the unknown of artificial intelligence will become known and in the process create new roles and new paths to solutions that we haven’t yet imagined. And through all that will be a requirement for the right kind of attitude (people) on the team.

That idea of having the right people on the team is something my boss, Catherine Blackmore, picked up on in her inspirational talk (I think she called it, What is your superman?) on day 3 of the conference.  She was speaking directly to marketers in the audience but her role as Global VP of Customer Success, and as one of the most prominent Customer Success thought leaders around, means she was also speaking to her own team and the Customer Success industry at large.

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“Build the team of today and tomorrow”. Build the team with people who embrace openness, innovation, partnering, and collaboration. Her talk and those characteristics she called out are interestingly supported by research for two specific generational groups.

Nielsen Norman Group researched the topic of millennials as digital natives. In the report you will see uncanny resemblance of the characteristics they list of millennials and the attributes that Catherine called out in her talk. Also, this was interesting too… “Many Millennials were in grade school or college when Google first rose to popularity, and it was a critical influence in setting the level of simplicity and directness that Millennials have come to expect from interfaces. They don’t care if (for example) your enterprise application has significantly more complex features to consider. When interfaces fail to live up to those unrealistic standards of simplicity, Millennials rarely blame themselves — unlike older users. Millennials are quick to criticize the interface, its organization, or its designers.” 

That is the indigenous (i.e. naturally occurring) behavior/attitude of a digital native.

And it calls to mind something I said in a recent interview with the online magazine, Chaos and Rocket Fuel. In the interview I said, “Here’s something to think about: if you ask a young millennial what the word “digital” means, more often than not you will be met with a blank stare. All they know is digital. So much so that they don’t even call it that.”

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While the millennial cohort has largely been absorbed into the workforce and is applying its own unconscious biases just as every generation has done before them, the next generation (Gen Z) is the one that will truly wipe things clean making business look and behave completely differently than it does today. Sorry Boomers, we’re almost through.

An article by Pew Research called, digital natives are born global citizens, elaborates on the characteristics of Generation Z. It’s the generation that follows Millennials and was born (approx) around the year 2000. They aren’t ready for the workforce just yet but soon they will be. If you really want to go deep on this topic, download the PDF from that Pew site and discover some interesting bits of information. It may disturb some preconceived notions you have of young people the world over. One stat that jumped out for me is this one:

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It jumped out not because it surprised me that young people are tight with technology. Everyone can see that. Why it jumped out is because of the faith they have that technology is so consequential to the hopefulness of their future. It’s sweet and it should cause us (older generations) to pause in contemplation. Young people are not misguided to believe that technology can be a force of good. Let’s make sure we deliver on our part of the bargain. Let’s be open, let’s embrace change, let’s innovate, and let’s do it together.

 

 

 

 

The Power of Team

INSEAD team

What do CEOs expect from their Customer Success (CS) organizations? There is fluidity around this topic but stripping it to its essence we can say they expect their CS orgs to take responsibility for these things:

  • higher retention of existing customers
  • higher revenue attainment from existing customers
  • movement towards building an organization that operates under its own P&L, with healthy margins, etc
  • customer satisfaction goals that can be demonstrably proven to result in higher retention rates

What’s missing from the list is any explicit mention of product adoption and that’s because CEOs would say that adoption is a fundamental expectation that should be covered off by the drive to retain and grow customers, and by the strategy CS deploys to increase customer satisfaction. Fair point.

How are these expectations acted upon at the CS organizational level? There have been countless blog posts and articles written about best practices for on-boarding, education, driving successful renewal programs, measuring NPS and customer effort scores, and in developing billable or fee-based services within Customer Success to drive adoption. This article though will not add to that body of work. Instead, it will address a fundamental behavior (and yet a particularly difficult one to master) of professional organizations that aspire to deliver on those CEO expectations, leadership. By leadership I mean senior management that consistently demonstrates its ability to clearly communicate, inspire, model, and coach.

So VPs of Customer Success, this article is for you.

The recent Harvard Business Review article on the mediocrity on teams lists four leadership practices that lead to performance excellence. Most pertinent for this article is leadership practice #3, Establish Peer Accountability, which I believe can help Customer Success reach the elusive goal of C-level legitimacy that it’s been striving to attain since its inception. A common refrain heard in Customer Success circles is that it’s difficult to get complete organization-wide buy-in for CS at that level. Why is that? I believe it’s because CS struggles to empirically prove it can hit its KPIs across the board, quarter after quarter and year after year.

There’s an emerging practice for people who manage a team of customer success managers and it starts by drawing on something that sales organizations have been doing for decades. Senior sales leaders have their account executives present an overview of their territory to their peers on a quarterly basis.

There are all kinds of ways to improve your Customer Success practice and getting the team together to triangulate on the business costs (comparatively) next to nothing.

The typical agenda for a quarterly sales meeting will look something like what you see immediately below. Each account executive would be required to prepare a presentation that covers all the points.

Quarterly Sales Meetings Agenda

  • Overview of territory
  • Revenue attainment to date
  • Top opportunities (or, how I’m going to make my number)
    • Hurdles
      • Product support cases in the critical path
      • Competition
      • Action items to close
  • Competitive wins/losses in last quarter

Marketing is represented in these meetings and will typically deliver a review of activities they led in the last quarter to support sales as well as provide a forecast of activities to be conducted in the upcoming quarter.

Benefits of these meetings:

  1. Transparency
  2. Opportunity for account executive to demonstrate full grasp of the business
  3. Peer review and assistance
  4. Leaders get to publicly lead

I’m not sure how prevalent it is for Customer Success organizations to have adopted these types of meetings for themselves (I rarely heard of it during my time as head of Customer Success research with TSIA) but even if there are some that do conduct them, it’s highly unlikely they would approach them as comprehensively as what I outline below. For these quarterly customer success meetings, each customer success manager (CSM) would be required to prepare a presentation that covers all the points.

Quarterly Customer Success Meetings Agenda

  • Deep dive of one account
    • their business and its challenges
    • why they bought from the vendor
    • their health (or, what’s going on?)
  • Top customer achievements this quarter
    • measurable progress towards business goals
    • explicit examples of adoption
    • innovation using the vendor’s products
  • Adoption challenges in territory
    • trends, patterns
    • plans to address
    • communication with critical parties
  • Revenue (renewals, growth)
    • Top opportunities
    • Action items to close

Benefits:

  1. Transparency
  2. Opportunity for CSM to demonstrate full grasp of the business
  3. Peer review and assistance
  4. Leaders get to publicly lead

Because I’m a believer in the elimination of barriers there should be representation from Product Management, Sales, and Marketing at these meetings. All those teams would add tremendous value to the meeting and it’s important that they learn from the CSMs and hear details, patterns, trends of the customers’ experience with the products and the company from the one organization that has the most intimacy with them, Customer Success. Those organizations could then leverage their specialized expertise to offer ideas, clarification, and education for how situations and processes could be improved.

Now let’s dive a little deeper into the detail that can potentially surface from and about the CSM during these Customer Success quarterly meetings.

  • Assess the CSM’s business sophistication
    • Are there unique challenges inherent in the customer’s business that affect their ability to fully adopt our solution?
    • Is the industry or sector in decline? How is the customer addressing that reality?
    • What pressures is it facing from new technologies and new consumer behavior that are affecting the team that Customer Success works with?
  • Assess the CSM’s ability to employ all available tools/methods 
    • What methods are you employing to increase your understanding of the customer’s challenges?
    • are you comparing or benchmarking the customer and using the resultant information to help educate them?
    • how are you utilizing social media to learn more about the customer?
  • Assess the CSM’s product knowledge and their ability to match product to business need
    • Tell us about some of the customer scenarios (use cases) you’ve observed that could help mature our product.
    • Tell us why the customer may be ready or not ready to invest further with us
  • Assess the CSM’s knowledge intimacy of the playbook and their ability to think creatively for how it might be improved
    • Talk to us about our customer success playbook. Based on your involvement with customers over the last quarter, what suggestions can you make for improving our customer success playbook?
  • Assess the CSM’s knowledge of how the work of other organizations integrate with or otherwise could be leveraged to help Customer Success deliver better service to customers
    • How can other organizations within our company help you do your job?
    • How is the CRM fulfilling its purpose as the repository of customer truth?
    • How does the content you produce, or repurpose from other organizations, and transmit to customers resonating with them? How do you gauge its efficacy?
  • Assess the CSM’s ability to monitor and coach the customer and to discern from data what actions should next be taken
    • Have your customers always followed our script for on-boarding? If not, do you know why and how did they respond when you informed them that missing or skipping steps prevents them from moving forward on the adoption path?
    • What clues do you see in the dashboard and reporting data that support opinions you have about the customers’ odds of success?
  • Assess the CSM’s ability to speak to client experience
    • As the person most knowledgeable about the customer, based on your experiences and observations what can you tell us is the common perception customers have of working with our products and our company?

Senior Customer Success leaders should view these types of meetings as their Sales counterparts see theirs. The best ones see quarterly sales meetings as opportunities to build a pipeline of leaders, as creating an environment of collaboration that drives improvement, and as a crucible for vetting sales opportunities and refining plans to bring the deals to closure.

Senior Customer Success leaders should see CS quarterly meetings as opportunities to surface future leaders, to raise the bar of expectations about what it means to know your customer and to know their business, and to articulate a strategy for driving the customer towards their desired outcomes.  Finally, senior Customer Success leaders should honestly look at these meetings as opportunities to test their own ability to lead and to drive the organization further towards achieving those expectations of the CEO I laid out at the very beginning of this article.

For all kinds of practical and psychological reasons, coaching your Customer Success organization to improve is extremely difficult on a one-to-one basis. Those types of meetings are good for maintaining a communication flow and for very targeted and specific coaching. But some research from Stanford points to the fact that people learn better and improve faster in groups and in environments where they can present to and collaborate with their peers. INSEAD elaborates on this from the angle of compensation design in what it refers to as goal-framing theory in this article.

Coaching teams of Customer Success Managers is critically important because they, like Marketers, are on the forefront of technological innovation that revolves around the customer. The data onslaught will only grow and skills such as a person’s ability to think critically and in multi-dimensions and to communicate professionally and with precision will become even more valuable in the years ahead. Take a look at the table below from MIT Sloan extracted from this article. Artificial intelligence (which is coming on faster than most people realize) will be increasingly seen in the client experience space in the near future. Customer Success needs to prepare itself for how it will leverage and exploit new machine-led ways to touch and learn from customers. New roles will be required and current teams can adapt to them if the right environment exists now of looking at the customer from many dimensions and collaborating around strategies for improving their experience and their ability to succeed. Quarterly meetings as I described above will help stimulate and nurture the kind of culture that will be ready to assimilate and exploit AI to benefit Customer Success organizations and their customer engagement models. Senior leaders can prepare their organizations by creating now a mature culture that collaborates around the customer’s business.

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I’ll close by saying I realize there are many companies with dozens of CSMs in their organizations and that would find the prospect of having each CSM present in the meeting a daunting and near-impossible task. For large organizations like that I suggest that you map out the year and split up the presentations accordingly. The important thing to remember is that the benefit of having the CSM stand in front of peers and demonstrate a firm grasp of business is powerful and will dovetail nicely with what should be your company’s secret weapon, a strong, open, and outward-looking culture. That culture though also happens to be the trickiest thing to build, nurture, and sustain.

Can math help clarify the CS mission?

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Customer Success professionals need to start thinking of their mission in a similar way that professionals in Sales and Marketing see theirs. On the Marketing side, they see their mission as finding, nurturing, and qualifying interested parties and moving them further along towards a decision to commit to a financial contract with the marketer’s employer. Straight-forward. On the Sales side, they see their mission as helping those interested parties make that decision to sign the contract thereby securing new revenue for their employers. While the processes and tasks executed by these organizations can be complex and fraught with bumps, their missions are simple.

What is the mission of Customer Success? Is it as clear-cut as those other missions? What is it primarily about?

  1. Renewing customers?
    • Goal = keeping customer numbers up to improve the vendor’s balance sheet
  2. Expanding the business with customers?
    • Goal = growing revenue to improve the vendor’s balance sheet
  3. Helping customers adopt more of the product’s capabilities but motivated by how it benefits the vendor?
    • Goal = helping customer utilize more of the solution so that they feel invested in it and have more of a propensity to renew the financial contract. Symptoms of this behavior are when Customer Success is asked to intervene in sales-sensitive situations to clear technical challenges that are perceived as hurting the chances for renewal or expansion.
  4. Helping customers adopt more of the product’s capabilities but motivated by how it benefits the customer?
    • Goal = helping customer achieve their business goals so they can improve efficiency, or increase market share, or solve other business challenges that prevent them from growing
  5. All of the above?
    • Goal = do whatever is needed

Usually the answer is #5, which makes it not so straight-forward nor so simple. If companies take an honest look at it though, they might admit that they have their Customer Success teams focused on achieving #3, which when it’s considered as starkly as it’s written above, sounds crummy, like it’s short-changing the customer and causing damage to the relationship.

Unlike Marketing and Sales, whose missions are clean and easy to understand, Customer Success is too often charged with having to equally prioritize the following: implementation, enablement, support, consulting, coaching, nurturing, negotiating, selling, closing deals. Why the lack of focus? Pardon the straying into the theater of politics but it almost sounds like Donald Trump’s foreign policy. It’s all over the place, it’s inconsistent, it sends mixed signals, satisfies very few, accomplishes only a fraction of what it hopes to do, and is confusing to the people it’s meant to deal with.

There needs to be some order introduced into the Customer Success world so to make things easier I propose applying some basic math.

Adoption = quality product + clearly defined outcomes + enablement + quality, timely guidance
Renewal = adoption of the solution + quality relationship based on trust
Expansion = adoption of the solution + quality relationship based on trust + clear business need

Looking at it in reverse, Expansion won’t happen until there is Adoption of the solution, the relationship between the parties is good, and the customer has a clear business need for investing more with the vendor. Renewal won’t happen unless there is Adoption of the solution and the relationship is sound. Adoption won’t happen unless the product works, the customer has articulated clear business outcomes, they’ve been enabled with the right skills and knowledge to use the solution to achieve those outcomes, and they’ve received high quality guidance in a timely manner along the way. This is obviously a proactive methodology that prioritizes Adoption above all else. When you see things laid out mathematically they make sense. The logic flows. Changing the equation to prioritize Renewal or Expansion before Adoption defies science and human nature. It might work for some situations but it’ll work against you over time.

To close, and speaking of proactive, I’ll leave you with a line from Silje Nergaard‘s song, Two for the Road.

“I’d rather hit the road than have the road hit me”.  

Maybe it should be on a t-shirt.

 

 

Blockchain and my dad

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My father first taught me about the physics that underpins a chain. He was no craftsman but he could manage his way around most small projects involving hammers, saws, and screwdrivers. Because of our humble situation though, he ended up having my brother and I do all larger home repairs with him, everything except repairing the roof of the house two stories above the ground. But that was only because he didn’t want to buy a 28-foot ladder. One time he had us loop one end of a large 30-foot chain around the car trailer hitch and loop the other end around the corner post of our old dilapidated garage that he wanted pulled down and demolished. It was before demolition permits were required and before anyone had awareness of the need for safety glasses or even steel toe boots. It was that kind of time and no one blinked an eye that two boys in shorts and running shoes were given the task to climb all over a crumbling garage. But one thing my dad did for safety reasons is explain how chains work. We were about 13 and 14 years old at the time and despite the fact we knew everything there was to know about the world we still paid attention as he explained that the health of each link is critical to the overall strength of the chain. One weak link compromises the whole and so with decapitation on our minds we checked each link for the smallest evidence of weakness. Since we didn’t possess an electron microscope we had to put a bit of faith in dumb luck too. Cutting to the chase, the chain was sound, the garage collapsed when the car gently pulled the chain that pulled the post, my mother didn’t speak to my father for a day or so, the neighbors were unhappy with the dust, our two younger sisters cheered from the porch, my father saved a few bucks, and my brother and I lived another day. Lessons learned? Motion, force, energy… you know, physics. Oh, and teamwork of the links-in-a-chain kind.

Baffled as to what this has to do with business? Maybe this will help.  I was reminded of that long-ago story when I read this article from MIT Sloan about how Blockchain technology will transform how businesses are organized and managed. The message of the piece… that the strength of a chain, with verifiable and trust-worthy links, and the fact that each link is dependent on the other, is a perfect analog for how business processes can be improved. Think of the links as your current internal organizations (Marketing, Sales, Customer Success, etc.)  They can be connected to provide a more seamless and reliable process flow and experience for the customer. In short, they can be made to improve your business.

The Blockchain value proposition dovetails nicely with a message I conveyed in this recent talk at Totango’s Customer Success Summit 2017. In that talk I made a statement that businesses need to re-imagine their processes so that the customer is represented horizontally rather than be dealt with in the conventional vertical organizational fashion that exists today and has existed for a hundred years or so. Why change? Because the customer is not efficiently served via the conventional approach, and you’re losing business as a result. The experience the customer has is disjointed, being touched as they are by different people from different teams with different agendas, and the overall messaging they receive and the impression they have of your brand is often incoherent, at best.

Today’s organizations (Marketing, Sales, Customer, Success) hobble themselves with too many barriers that prevent them from collecting and sharing critical customer-relevant data, or from holding each other accountable for the delivery of some aspect of the customer’s experience, and from having visibility into whether the customer is achieving the outcomes they expected, and hoped for, when they purchased the solution in the first place. My colleague, Chloe Basterfield, touches on this from a marketing challenge perspective in this blog post.

Even before Blockchain invades the business world, smart executives can begin to build that horizontal flow with the organizations they have now. Encourage the breaking down of silos by organizing the leaders and rallying their teams and missions around the need to improve the process through which the customer is dealt with by your company. Conceptualize the flow as linked tasks that together form a rolling chain that pulls the customer smoothly through their journey with your firm.

You too can do this without safety glasses and steel toe boots.