Limitations in Customer Success Stem from Common Impediments
Based on a recent study conducted by Service Excellence Group XRG, Shreesha Ramdas, Senior Vice President and General Manger, Strikedeck at Medallia, gives us input on how CS has played a more limited role in organizations based on some common factors.
“Be all that you can be” is a motto that has not generally been fully realized in the realm of customer success. While there are loads of success stories about customer success, its overall potential has been rather limited, and it has been held back from making a greater contribution to the company. Several common impediments combine to mute the greater potential impact and long-term value of customer success.
Based on research conducted by the Service Excellence Research Group (ServiceXRG), we developed a study that examined common customer success practices and hindrances to achieving a greater impact. The first, and most obvious, observation is that there is wide recognition that customer success could and should achieve so much more.
Today’s data-centric, dashboard-driven enterprise seeks to constantly drive improvement and advance goals through actionable knowledge and metrics. Every part of the company is or has gone through a “digital” transformation with systems and practices that centralize processes and information, bringing transparency, accountability and shared intelligence. The once “black box” dominated field of sales now uses a CRM to make sales more predictable, efficient and achievable. IT has embraced service management to become more responsive and even proactive amidst constantly changing and increasingly more complex infrastructures.
Customer success has the potential to improve the full lifecycle of customers, but today in most organizations it only addresses a portion of the customer journey. According to our analysis of data provided by primary research from Service XRG, 14.8% of respondents reported that their customer success activities and focus were comprehensive and geared to the entire lifecycle of a customer. The majority (85%) were focused on one to several activities oriented towards specific goals in getting customers started with a product or service. Nearly half of responding companies focus on just one or two customer success activities in total.
Three types of impediments generally account for customer success being in this more limited focus: organizational limitations, limited lifecycle focus and limited tools. While the desire and recognition may exist to accomplish more, the impediments effectively lock customer success into a particular role. The more limited role brings unquestionable value. In fact, and perhaps ironically, the success of customer success may contribute to its more limited role. Generally, customer success is doing a great job—but it is capable of contributing much greater value. Allow me to go into some detail on the impediments we found to better understand how customer success can advance.
First, many customer success groups have organizational limitations. Only 12% of the survey respondents indicated that customer success was its own, independent function or group. Most respondents revealed that customer success was a part of the company’s service or support organizations, and, obviously were captive to focusing on the primary goals of the organization. Of the 88% reporting that customer success was part of another department, 59% said that customer success was a part of the services organization, while 12% said it was in the technical support organization. The remaining 29% said that customer success was a part of sales.
With nearly three-quarters of respondents reporting being in service or support, customer success tends to focus on traditional issue resolution activities in addition to immediate adoption practices geared to new customers. Most of the focus was outcome-focused tasks, rather than proactive, success-focused roles, such as comprehensive onboarding and “right start” programs. Often these, organizations are chartered to avoid or minimize service requests and issues. This model—because of urgency and volume—tends to force customer success to quickly move on to other new customers, only to start the process all over again.
With this primary focus geared to initializing new customers, few respondents indicated that they conducted a robust “right start” program to better support customers for the long term. Less than half the organizations surveyed have a formalized onboarding program We found this to be a bit surprising, but also understandable. Transactional necessity has forced many customer success practices to just give customers what they need to start up with a product or service—a kind of initialization—rather than developing deeper capabilities and catering to specific needs and requirements. Such a focus falls short of a long-range view of customer health.
A second common impediment relates closely to the organizational home for customer success and its goals. The limited customer lifecycle orientation is group and goal driven, but it is also constrained by the need to understand and develop practices geared to these latter stages. It also requires a shift from thinking predominately about a company’s products and services and better understanding customer needs and goals.
To fully embrace an orientation of “how can I help my customer to be more fully successful” requires an ability to stop and listen to the customer and respond to individual concerns and conditions. This tends to be more resource-intensive (requires more customer success professionals). It also may have a lessor immediate pay-off in favor of long-term benefits that might be more difficult to specifically identify. Techniques and tools for helping advance customer goals need to be developed. They also need to be shared and retained by the entire organization, so that practices and tools for needs among multiple customers do not have to be reinvented each time.
Another aspect of limited customer lifecycle focus is the multi-disciplinary aspect. While it is generally best the customer success can be its own organization, it is also imperative that it is well-connected to most other organizations in the company, including sales, support, development, documentation, and more. Customer success may need the help of these groups to solve immediate customer issues and at the same time may be able to pass on invaluable insights as to how to make a product or service better. Capturing this information and getting it to the right people is non-trivial.
Finally, a third common impediment is a limitation of tools. According to the survey, 24% of respondents indicated that they have no systems or tools for customer success at all. 30% reported that they have some limited tools– typically for logging cases or capturing customer contact information. 20% have limited systems for programmatic management, and only 26% have a system suited for driving long-term benefits.
Ideally, customer success should have its own system of record to not only guide and manage its activities, but also to capture and centralize information at key junctures of the customer life-cycle. The system should help ensure that certain actions are taken as a result and that information can be channeled to the proper groups within the enterprise, ranging from the development organization to service/support, sales, product management, product marketing, training, documentation and others.
While most companies understand the customer success has the potential to deliver far greater value, getting there requires addressing these fundamental impediments. As an industry, we can all work towards making the shift more achievable.
