Customer Success Has an Identity Crisis

Customer Success Managers have to stop doing this

I was fortunate enough to attend the Pulse World Tour in NYC that Gainsight presented and it was very clear that there is a common enemy that Customer Success Managers (CSM) around the globe are suffering from (beyond churn): its themselves. That’s right, CSMs have become their own worst enemies due to the loose definition of their roles. Meinrad Heuberger from the Boston Consulting Group mentioned that one of the major pitfalls of Customer Success today is the “unclear formulation of the primary purpose of the Customer Success function”. The speakers at this event shared the scars they’ve accumulated as well as the victories in their battle against this persistent foe.

This is part of the problem

The role of the CSM continues to evolve but what has remained is the ambiguity in what it means to be a Customer Success Manager for many CS organizations. There is a misconception that a CSM should take on the role of a superhero that should do whatever is necessary to make the customer successful. Wrong. No! CSMs don’t have mutant powers that will allow them to protect the galaxy or perform Jedi mind tricks. This superheromentality has perpetuated the identity crisis of the CSM. This has to stop immediately! It’s not only preventing Customer Success teams from tackling the larger issues that may be plaguing an organization (such as product deficiencies or misaligned expectations in the sales process), it’s causing CSM burn out and team morale issues. I would also argue its damaging the reputation of the CS profession. Let me go through some examples from the Pulse event on what the local CS experts are doing to address this.

Discipline = Freedom

One of my favorite recent reads is called Extreme Ownership by Jocko Willink and Leif Babin. They harp on this idea from their Navy SEAL days that if you create a more structured environment where you make sacrifices for the greater team, you can act with more independence as there is trust that you are performing in the right way. This goes against what most people believe that more process can stifle the creativity needed to be a “successful” CSM. The reality is that the more you understand what is expected of you and the clearer your role is, the more productive you can be and there is a greater chance that your team will be more successful. Very simply: discipline equals freedom. The same applies for Customer Success Managers but it may not be apparent at first.

From “Extreme Ownership”

At the Pulse event, here is what the speakers shared that backed this up:

  • Austin Kwon from Box mentioned that there CSMs had somewhat of an identity crisis once other teams started to take on what was once considered the domain of a CSM. This included training and support. They retooled the team to focus on client outcomes and created playbooks to support this. Austin lamented that he wished they would have better defined the mandate of the CSM earlier.
  • Cassie Young from Sailthru implemented time tracking for the CSM team which allowed her team to identify where the CSMs were spending their time. It turns out they were doing things that they hated which impacted morale and took them away from the important tasks that would really move the right dials. Cassie has a much better grasp on what her team is doing and where they need to invest. This is helping her better communicate to the board on how her team is performing as well as properly allocating costs to the right line item. It never hurts to win points with the finance team.
  • Tim Sedwitz and Lauren Crocett from the Yext team outlined how they retired the CSM swiss army knife mentality. They built out a consistent customer journey for both their customers and for their CSMs so that they could operationalize the role and focus on what is most important: driving client outcomes. They streamlined what was expected of the CSM and it’s been night and day for the team. Did I mention that Yext recently went public? Seems to be working.

All of these examples demonstrate the new discipline that CSM teams must have as the definition of what it means to be a CSM evolves. This new standardized approach creates freedom as it puts the right guardrails around where a CSM should play instead of the CSM trying to boil the ocean on a daily basis. This same type of rigour has been instituted within other functions such as marketing and sales. If Customer Success wants to grow up as a profession, it needs to accept these realities as well and embrace them. Let’s take our capes off once and for all. The superhero mentality must die.

The CS Superhero must die. Sorry, Not Sorry.

Once an organization gets to a certain size (say 3 CSMs), we have to stop referring to CSMs as heroes, ninjas, duct tape, swiss army knives or jack of all trades (and whatever else they’re called). I have to admit that I helped perpetuate this problem in the past. What I tried to do was carve out the different parts of the customer journey into specific teams such as onboarding and support which would allow the CSM team to be more proactive. I needed to improve how we defined what a CSM should and shouldn’t do. Lesson learned.

Allyson White from Insight Venture Partners made it very clear that VCs are looking for CS teams to focus on the following key metrics: outcomes, leading indicators (such as adoption data) and efficiency. From my perspective, it’s not enough to set a general mandate for the CSM team to be “proactive” or build relationships. You can assign a number of goals for the CSM team to complete such as success plans or executive business reviews and never achieve the results (improvements in renewal rate) that you are looking for. You first need to start with the customer and understand what they want and need from their perspective. You can then map out the ideal customer journey by outlining the various milestones and interactions and estimating the resources it will require to execute this. You then need to decide how exactly you can achieve this based on the business realities.

By tracking how much time it takes to accomplish the proposed customer journey and by comparing these projected costs with your average sales price (ASP), you can determine what is possible and budget accordingly. You may need to move a few levers such as hiring more CSMs, investing in the right technology or raising your prices. By tracking the business metrics and the impact of your CS activities, you will determine the right path. Whatever you decide to do, always keep these three metrics in mind: outcomes, leading indicators and efficiency. At the end of the day, that small improvement in retention can have a monumental impact in your company’s valuation. Thank you for the reminder Allyson and of course Allison Pickens for outlining Gainsight’s approach to this (their CSMs are called “Outcome Managers”).

I want to thank Gainsight again for putting on such an informative event! I also enjoyed meeting up with a number of fantastic people in the NYC Customer Success community.

PS: An honourable mention goes to John Gleeson and his “elephant in the room” presentation as he tackled the question of whether CSMs should handle upsells.