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Mastering CS – Candid Leader Insights – Ep 11 – Parker Chase-Corwin

Updated on March 27, 2024 25 minutes read

Summary points:

In our new episode of the Mastering CS – Candid Leader Insights podcast, Irina Cismas, Custify’s Head of Marketing sat down with Parker Chase-Corwin, CEO & Principal Consultant at Xperience Alchemy.

What You’ll Learn:

  • Customer success in 2023
  • Challenges in CS
  • Alignment and understanding of the CS
  • Key metrics for customer success
  • Internal alliances between departments
  • Selling CS internally
  • Budgeting for CS
  • Predictions for 2024

Key insights and takeaways for CSMs based on the interview:

CS in a team job: Achieving customer success is not solely the responsibility of a dedicated team; it involves collaboration across different departments, including product development, marketing, and sales. Each department contributes uniquely, like product development creating desired features, and marketing and sales targeting the right customers. This integrated approach is crucial for creating successful customers, emphasizing that customer success cannot be achieved in isolation within a company.

Customer success as a revenue center: In a down economy, customer success teams face increased pressure to contribute to revenue generation, often leading to an overload of responsibilities. It’s crucial for companies to assess the team’s capacity and redefine their roles and tasks, ensuring they align with the organization’s maturity and the team’s capabilities. Addressing underlying issues, like product limitations, is essential to avoid overburdening these teams and to maintain effective customer success strategies.

KPIs for CS: There’s a need to shift focus from lagging to leading indicators within customer success metrics. While Net Revenue Retention and Gross Revenue Retention are commonly used, they often reflect past activities (like churn or renewals) and don’t provide proactive insights. Instead, identifying and monitoring leading indicators – like customer behaviors during onboarding or tool usage patterns – can better predict and influence future success and renewal rates.

Structuring the CS team: As companies mature, especially when they surpass certain revenue milestones, the structure and focus of customer success teams often need to evolve. There’s a trend of these teams being placed under the Chief Revenue Officer to align more with revenue goals, but it’s crucial to balance this with the broader aspects of customer success. Specializations within the team become necessary as the product and customer base grow. This can include roles like onboarding specialists, renewal specialists, or technical experts, each focusing on specific segments of the customer lifecycle.

Budgeting for CS: Securing an adequate budget for customer success teams hinges on demonstrating their impact on business outcomes, particularly in relation to revenue. It’s crucial to clearly articulate the team’s activities and responsibilities, assessing if they are overburdened with unplanned or miscellaneous tasks. Identifying areas for automation, delegation, or elimination, possibly through a focused task force, can streamline operations.

Podcast transcript:

Customer success in 2023

Irina 00:03
Parker, 2023 has been quite a roller coaster for everyone, especially in the Customer Success world, given your unique perspective of being hands-on in the trenches and also strategic in workflow, how would you characterize this year from a CS standpoint? Any particular challenges that stand out to you?

Parker 00:23
Definitely, yeah. 2023, I really think we’re gonna look back on this year as a pretty significant inflection point for customer success. It’s, it’s a combination of a number of factors, I think it’s a bit of a perfect storm out there right now.

So obviously, with the economy coming down, that’s tightening revenues, it’s tightening budgets, it’s putting a lot of pressure on those post-sales teams. Then you add in the layoffs, you add in what I think is a very real problem within customer success, which is burnout. I think there are a lot of teams that are overstressed and having a hard time managing all the balls that they’re carrying.

But I think really, one of the big things that I’ve noticed is that there’s a real challenge in that there’s a lack of a consensus definition on what customer success actually is. So I think that’s created a lot of misconceptions out there. I think, certainly at the C-suite, and at the board level, they’re not sure what to compare to when they look at their own customer success team and look at their peers.

And I think there are just a lot of flavors that have emerged over the last several years, which means that there’s just a lot of confusion out there. So when you look to see is, is your customer success team performing? There’s sort of that lack of consensus, second definition about how to compare that to.

So I think, you know, there, there are a lot of things that we’re seeing in terms of new technologies coming out, which is enabling teams, but also have to be embraced and invested in and adopted, that’s causing some ripple effects. But I think at the end of the game, I really think the biggest struggle that I’ve seen is that companies are just really unsure of what to do with this big customer success program and try to understand really how to get the most value out of it.

Alignment and understanding of the CS function

Irina 02:13
I want to ask you what would it take to better redefine or better explain, or better advocate for the CS function. Because I feel like we’ve been doing customer success since forever. But we just called it somehow differently. But even in this situation, I think everybody speaks about it. And we do not manage to reach a common alignment. What do we need to reach this common alignment and understanding?

Parker 02:53
Yeah, it’s so-so, I think it starts with understanding when we’re talking about customer success. It’s, it’s used interchangeably in a lot of different ways. So, customer success is a company motion, right? It’s trying to enable your customers to be successful using your product. Customer success is a cultural idiom. So you know, it’s about how we create a culture that fosters customer success. Customer Success is also a discipline and a team. So it’s a group of people that are responsible for making sure that customers are successful.

I think what we have learned and really see, as leaders have been shouting this from the rooftops for many years, is that that’s not a realistic mission for a subset of folks within the company. There are certain things that they can be responsible for in terms of delivering value to the customer, making sure that they are driving adoption of the products, and making sure that the customer is able to articulate an ROI. But there’s a lot of dependencies on various other parts of the organization, such as product, for example. Product has to release features that customers really want and will use. There is marketing and sales, making sure that we’re selling to the right fit customers, to make sure that we’re not bringing in customers that are really kind of off the rails in terms of what they’re trying to do versus what we offer. All those things, plus many others, I think go into this idea that customer success is trying to really help to make more successful customers, which is a subtlety but a really important one. You can’t necessarily just do that within a vacuum, within a small team.

CS as a cost center vs revenue center

Irina 04:45
Now, I want to talk to you about customer success in cost center organization and not necessarily I want to talk about customer success seen as a cost center versus revenue center. Because I think how companies view their CS team can really change the game in how they operate. So the question is, when customer success is seen as a cost center, rather than a revenue one, what does it mean for the team strategy? And for the approach? How do we set the foundation for CS, when it’s perceived as cost center?

Parker 05:31
So I think in a down economy, it gets particularly interesting. The pull is obviously more towards revenue-generating activities. Companies are trying to make ends meet, sales are down, they look to the customer-engaged teams to figure out how they can help to boost revenues. Most teams that I know are already overwhelmed. So adding another responsibility on their plate in terms of driving leads, or trying to help with the sales process is going to potentially do real harm to the team, who by the way, are potentially not natural sellers. But also, their mission is overwhelming because they’ve inherited a lot of what I’ll say is collateral damage from upstream decisions.

So what that means is that there have been decisions made in the customer lifecycle, which customer success teams end up taking on a big part of the burden of. So to your question, what does it mean for strategy and approach? I think, the first thing I would say is we have to think about where we are as a company in terms of our maturity and our stage. So early stage, we tend to have customer success resources, whatever they’re called, doing a lot of different things, wearing a lot of different hats. And then as you get more mature in your evolution, you’re going to start to go through some of those growing pains. That person can’t do all the things that they did previously. So you really have to think about what falls under the customer success umbrella, in terms of responsibilities, in terms of goals, what are they actually tasked with? And what do they actually have the capacity to be able to deliver.

So if your CS team is doing renewals, if they’re doing upsells, if they are responsible for driving case studies, like those are all great activities that can really help with driving revenue. So you want to first examine what is their proximity to those revenue-generating activities. And I think that’s where we see a lot of variability. Because going back to our earlier point, Customer Success teams, the definition is pretty broad. Some teams are responsible directly for renewals, for example, sometimes or not, sometimes that’s managed more by the account management team or by the sales team. So you have to really think about, you know, how do you make sure that the lifecycle of the customer is designed in such a way that it’s really meeting the customer where they’re at, and then figuring out how the customer success team can drive value across those various stages.

So if they are overwhelmed, if they are doing a lot of non-revenue generating tasks, you have to really inspect that. You have to dig in, figure out why, what is the cause of that? Where does that originate from? And I think that, you know, I’ve seen situations, for example, and one of the companies that I worked at, I owned a team of very technical consultants that really helped the customer to deliver value in the product. When you really pulled back the covers and took a look at that, what they actually were, were human gap fillers for the product itself. The product was not built in such a way that the customers could get full value on their own. So we had to plug in human resources to be able to help them configure the product and customize it in the way that it needed to be. So if you have that sort of a burden on your customer success team, you can’t just take that away without doing a lot of development on, say, the product side in that example. So you really have to figure out, you know, is the team responsible for these activities the right team to do it? And are these activities really necessary?

Cost center challenges

Irina 09:18
Can you share some challenges that you’ve faced in environments where CS is perceived more as a cost center, and how did you manage to navigate these challenges?

Parker 09:29
Yeah. So I’ve been doing customer success for about 20 years. And I think I’ve always tried to align my team as closely as I can to revenue. So you can show that in a couple of different ways, either directly or indirectly. So you know, as we were saying, if you own renewals, you’re already ahead of the game. It’s very easy to tie yourself directly to the outcome of those recurring revenue activities. But I think you want to always strive to tie yourself to creating revenue streams, again, either indirectly or directly. And you could do that through a bunch of different ways.

So it’s whether it’s tying yourself to say services revenue, if you have a professional services team that customers can get value off of, how does the customer success team encourage customers to buy services? Or perhaps there’s a premium support offering, how do you get customers to upsell to a higher level of support, creating leads for sales? The SQL or qualified lead is a really good one, to be able to create a new source of leads for sales to go after. And then more indirectly, you know, building reference customers, making sure that sales has a library of customers that they can go to, to help to close deals, various trainings that potentially you could offer or, you know, even events, sometimes there’s a paid-for event for, you know, a company annual gathering or something along those lines, being able to influence the outcomes, and then the revenue associated with those is really important.

If you can’t get there, I would say the second-best option is to show how you drive efficiencies and reduce costs. It’s not as impactful, I would say, in terms of showing the value of your customer success team. But I think there certainly is some benefit to showing how you are driving better efficiencies across the company, or reducing the cost of supporting your customers in board conversation.

Key metrics for CS

Irina 11:42
What are some key metrics or KPIs that you prioritize in revenue center for CS? What’s important for you?

Parker 11:52
Um, so I think everybody looks at Net Revenue Retention and Gross Revenue Retention. So looking at the recurring revenue plus upsells, and churn factored in. For me, I think there, I’d rather go a level deeper. So I think there are two problems. So one is that there are actually many different metrics that we can look at within a customer success organization. And we don’t always know how to use them. So that’s one, I think, we tend to report on all the things which creates a lot of noise, and it contributes a little bit, I think, to some of that confusion out there. But more importantly, I think we tend to focus on lagging indicators.

So when we look at the outcomes that emerge from a customer success motion, they tend to be lagging indicators in that, you know, churn is a lagging indicator of what’s preceded, you know, when a customer renews, it’s the result of, you know, their experience over the course of their previous term. So what I like to do is really move teams upstream to look at leading indicators. Just like sales has a sales funnel, they look at leads and how many qualified leads they need in order to get to a demo, and then how many demos they need to get to a sale, etc. I think we in customer success also need to employ a very similar mentality. So it’s looking at, you know, what are the leading indicators of retention? How do we figure out what successful customers who are renewing are doing, and then figure out how to quantify that and then map that across our entire customer base?

That’s where I think it gets really interesting, because then you can really start to lean into what are these customers doing? How can we make our other customers do something similar, and thereby increase the likelihood that our renewal rates are going to go up? So it could be something like, what are they doing during the onboarding process? Is it that they’re getting to a certain stage, within a certain period of time? Are they using the tool in a certain way, a certain number of times per month? I mean, there are a lot of different ways to break that down. But really looking at what is that metric? What is that thing that demonstrates to you that a customer is successful using your tool?

Irina 14:13
This all brings me thinking about data. And the idea is we also need to have data hygiene. And I know that this is a big challenge that a lot of companies have. Data sets in different systems, we don’t have a common nominator between ourselves, everyone has different definitions, and everybody lives in their system.

What do you recommend? Hopefully, we can put on paper the things that we want to measure at least an ideal framework, but then we realize that that it is not available where we cannot reach it. What’s your take when it comes to navigating the complicated world of data?

Parker 15:06
Yeah, most of the customers I work with right now are really struggling to figure out how to manage their data. So I think there’s a very common problem. A couple of things. One is, technology has advanced significantly in the last even five years, in such a way that there are now a lot of different tools and systems out there that allow us to better manage our data. That’s good news. Before, it was largely spreadsheets and a lot of manual effort. And I think we’ve come a long way, in terms of the technology side. Having said that, to your point, it still requires a lot of data governance. Where I think a lot of customer success teams are struggling is that they don’t have the operational discipline to be able to really manage that. And a lot of that has to do with it. They don’t have a dedicated operational function, who is responsible for making sure that the data hygiene is there.

But too, I think, there’s a lot of interdependency with other areas of the business. So, you know, a classic example is, when sales closes a deal, is there enough information in the CRM to be able to empower the post-sale teams to know what happened during the sales cycle? Is the primary contact labeled? Is the buyer labeled in the system? Do we have the right information for them? I mean, very simple things like that tend to be real burdens and challenges for teams to make sure that they’re staying on top of.

So I think any part of a customer success motion has to contain some data governance. But I also think that there needs to be a dedicated focus from an operations standpoint, to really make sure that, you know, your CSMs are busy, they’re not going to have time to constantly go through the system and update it and clean it, even though it is part of their responsibility. They really need an operational element to really help them do that at scale.

Challenges in integrating a CSP

Irina 17:09
I want to talk about challenges. I want to ask you, as a C-level executive, I’m sure you face various challenges when integrating with different CSPs. What are the most common ones you’ve come across in these high-level roles or better said what is the biggest challenge now for executives?

Parker 17:39
I think it’s a question of balance. So, kind of building off what I was just talking about, there are a lot of inherited priorities that come to you and your team, that happened further upstream. Decisions that are made in terms of product releases, how we’re going to market, the messaging that we’re giving, the implementation process, there are just a lot of things that, as the post-sales team, you inherit a lot of those upstream decisions and events that happen. What that does is that it tends to bog the team down in firefighting. So it’s very much reactive work. And that’s very much contradictory to the nature of what we want to do as customer success managers, which is to be proactive, to really guide the customer down their most successful path. But it’s very hard to be proactive, when you’re spending all your time being reactive.

So I think the teams that are really struggling right now are the ones that did not have great discipline, in executing at an operational level. You know, prior to the customer success team inheriting the customer, there’s a lot of baggage that comes with that. And it’s a very elusive tipping point. If you find yourself in that scenario, it’s, you really almost have to do double time to catch up to work cross-departmentally, and really within your company to try to change some of those processes or some of those decisions, so that you’re not continuing to overburden your team. Really, all that does at the end of the day is you become great at putting out fires and helping customers solve problems that happen with your product. But ideally, you don’t want those problems to happen at all. And so it becomes a real concentrated effort to try to focus or shift the organization’s focus to address prevention and preventative activities, as opposed to sort of reactive problem-solving type of activities. That’s a hard one for CS. You really have to have a good CS leader who really needs to work very closely, I think, with every other department in order to be able to do that. It’s, and sometimes that creates big changes within an organization.

I can remember a situation I had at a company where the product team was releasing new features every week, which was, you know, a great testament to the work that they were doing, we had a very strong engineering team. But it was actually a velocity that we couldn’t keep up with either ourselves internally, or the customers couldn’t consume it fast enough. So in sitting down with that team, we were able to show them that a) customers weren’t using these features because they were coming out too quickly; b) our teams were not well-equipped to be able to message them, support them, promote them, etc. And ultimately, what we ended up doing as an organization was changing the release cadence to once a month. That was awesome; immediately, we saw a great success with that, in that the marketing team was now able to put some real marketing collateral behind these releases, and really sell the advantages of these new features that product was putting so much time into developing. But then our teams, sales, CS, we were better equipped to talk about them, promote them to customers, and then customers were also able to consume them at a more reasonable pace. And I think overall, we saw just a tremendous lift off of that.

Internal key alliances

Irina 21:23
Speaking about product, I wanted to ask you, what other key alliances did you build in the companies you’ve worked? Which were your partners in driving those internal conversations?

Parker 21:42
It really, I think, as the, I’ll say, the owner of the customer experience, you touch pretty much every part of the business. So I would say the four key ones, for me, at least in my experiences, have been product, sales, marketing, and then support, unless they’re part of my organization anyway. But those are the ones that I think, you know, they’re all customer-facing, they’re all helping to deliver the messaging and the expectations. And I think those are the ones that you need to be spending. I mean, gosh, at some points, I was probably spending 50% of my time with other teams, trying to anticipate, you know, things that would impact the customer’s experience, the team’s experience, making sure that we were in alignment in terms of our strategy. What we were focusing on, what was coming up, I think those teams are really essential.

So for any CS leader, that’s not spending a significant amount of time. And obviously, it depends on the company. But I think, a very significant amount of time with those other departments, you’re probably playing catch-up right now.

Selling CS internally

Irina 22:52
In all those conversations with your strategic partners how do you advocate for the CS team? I think there is a matter of promoting it and selling it internally and explaining the value. Because I think everybody knows how sales contributes to the overall growth of the company. There are some cases in which but the role of marketing everybody knows what the marketing does, because it has been for forever since support that I can understand that part is customer success, where everyone has a different definition it need constant selling and advocating and making sure you keep your place at the negotiation table. What do you do? And what’s your recommendation for other CS executives, when it comes to selling it internally?

Parker 23:53

Yeah. First, the first thing that comes to mind is, don’t wait to be asked. Set another way, I think it’s really important that you are very clear with your team about what they’re responsible for and how you’re going to measure them. But then also, being very transparent with other teams and other departments and sharing that information proactively. Posting it in a place that everyone can access is great. Bringing it up in, you know, company meetings, team meetings, is excellent. Inviting them to your meetings, so that they can have a seat at the table, some influence, and bring back to their own teams what they’re hearing, it really comes down to just, I think, creating that very transparent culture. So I would start there.

And then I think, you know, being able to do the same in reverse builds a lot of trust. So working with other leaders of other departments to invite yourself to their meetings or, you know, send a member of your team as a liaison to be able to sit in on their team meetings or their forecast meetings or such, building out that cultural acceptance of teams working well with each other, I think is a really great way of making sure that there are opportunities to catch things that maybe you didn’t see or bring up thoughts, you know, in terms of strategy or execution of an upcoming initiative that maybe that department didn’t think of right out of the gate. So I think it really does start with that transparency, though. So leading with, you know, this is what we’re doing, setting the tone, and then asking other departments to do the same, I think is very, very powerful.
How to structure your CS team

Irina 25:39
Speaking about teams, how do you structure your own CS team? What are the roles that you are trying to fit in? How does your CS team look like?

Parker 25:57
Again, it starts with where you’re at in terms of maturity. I see that there’s a big shift right now, where there’s a lot, again, going back to our earlier point around revenue focus. I’m seeing some customer success teams end up shifting in the organizational structure underneath the CRO, which is, you know, makes sense. If you’re talking in terms of revenue and renewals and things like that, like I could understand that argument. There is a lot more to the customer success team’s role than just the revenue though. So it’s important to just be thoughtful about that move, because inevitably, when you shift them under a revenue owner, that’s where a lot of the focus is going to go.

Within the team, though, to your question, I think, as companies grow, specializations emerge. So you want to do a lot of inspections regularly. I like to do a time allocation exercise with my team to figure out how they’re spending their time and kind of group it by buckets. And then what that does is that really illuminates areas of the business that may need some different attention or different focus. As products grow, as they get more complicated, as more customers are added, different customer segments, different use cases, etc, it does become hard for one person to be able to deliver all the things to a customer.

So as you’re maturing in your organization, as you’re growing past, you know, say the $10 to $20 million mark in terms of ARR, like there does seem to be a real stage there where you have to think about approaching the customer challenges from a different perspective, meaning you have to build some specialization. So I think some of that is a human element, it could just be simply taking a piece of the customer lifecycle and assigning it to another person. So maybe it’s an onboarding specialist, for example, to really focus on the first say, 60 to 90 days that the customer has with you. Or maybe it’s a renewal specialist, and you take the renewals responsibility away from the customer success manager, and you give it to a dedicated renewals person.

Some of that is the type of activity. So I think, with technology where it is, what can you do to leverage technology to take away the manual tasks, the things that are just very time-consuming? A lot of great technologies out there around say, note-taking or, you know, automatic nurture campaigns and things like that, those are very, very useful in reducing the amount of time that some person, that CSM, has to spend getting through their daily tasks or their weekly tasks.

And then, one other point I’ll make on this too is depending on how technical your product is, how complex your product is, from a technical standpoint, I have definitely seen and created a role around a technical specialist. So someone either that can be working with a group of customer success managers to help to empower the customer to get the most value from a technical standpoint on their platform. So call them a customer success engineer, for example. That’s a very important role if you have a very complex or configurable platform.

CS ops

Irina 29:20
What does CS Ops mean for you, because I know that it’s a debated position and again, it has different understanding. So I want to ask you, what’s your definition of the role of our customer success ops person? And in which moment of their overall organization should you consider hiring? What are the signals that you need an ops person and you should prioritize it in terms of criteria?

Parker 29:57
So let’s see. So, a story here. Two jobs ago for me, I had the opportunity to build out a team from scratch. And one of the very first roles that I hired for was an ops person. And I think for me, what was really important about that was getting someone who is extremely good at systems and data analytics, to be able to help to create some of the playbooks that we were going to be executing on. It is a really important role for empowering the team. So I like to call it the rising tide that lifts all ships. It’s really something that where you can get 10 to 20%, or maybe even more impact out of every person that you have on your team. So I think in that regard, it really does get a lot more effectiveness out of your team.

The last company I was at, I made a mistake, and I did not prioritize Customer Success ops. And as a result of that, we were constantly trying to play catch-up. We were really trying to make sure that we were, I guess, well, trying not to overburden the team, but we didn’t have the pieces in place not to do that. And so we got in a real bind there. We had a lot of pressure in terms of people leaving, we had to keep backfilling roles. And so that was, that was a really tough one. I wish, looking back on that, that I had prioritized an ops person, even if that would have caused some short-term pain for the rest of the team in taking on more customers than they were comfortable with. Because I think overall, that would have actually put us in a better position.

So I guess the reason I share that story is that ops is a very, very important piece of the customer experience. And customer success is one of the teams that delivers on that customer experience. I like the idea of having a dedicated resource to customer success. But I also very much like the idea where the ops person or team can help to be the glue across the other departments as well. So you typically have RevOps, or you have marketing ops and things like that. If those teams can work really closely, or even be centralized and reporting together, I think there’s a lot of value that you can get off of that. Because again, customer success as a motion is not delivered through one team; it’s delivered through the company. And if you can have that ops team centralized within the company, helping to deliver successful customers, I think that’s a real game changer.

Customer Success budget

Irina 32:29
All of the tools and resources do require a budget, how do you make sure you get well funded? How do you make sure that you get the funds for the CS team?

Parker 32:43
Yeah, so it’s a good question. It’s everyone always wants more budget than they get, right? That’s one of the truths out there. But I do think you start by connecting it to the business outcomes. And again, if you’re closer aligned to the revenue, that better makes it easier to have that conversation. But I do think the, again, going to this misconception about what customer success management teams do, you have to very clearly define what are the activities that your team is doing across all their responsibilities. Are they this proverbial catch-all bucket right now? How much of their time is consumed with taking on, say, unplanned or unallocated activities because of other things that are happening within the business?

And when you break it all down, you have an opportunity to either automate some of that through technology, or perhaps delegate that to other departments, or perhaps eliminate it altogether, maybe getting together a tiger team of folks to solve the root cause problems. But when it comes to budget, you have to paint the picture of what it will be like if the team can’t get to all those tasks that they’ve been assigned, whether it’s, you know, by accident, or they just sort of absorbed other things that happened earlier in the lifecycle, or whether it’s, you know, by deliberate choice, they only have a certain amount of time per day.

And when it comes to customer success managers who are meant to be engaged with customers, if they’re spending 30, 40, 50% of their time doing these reactive tasks, or being more internally focused, doing administrative work, things like that, that’s less time that they have to spend with the customers. And therefore, they can’t either deliver the same level of service that you want them to for customers, or they can’t manage as many customers. And as soon as you start figuring out the math and the arithmetic behind that, the budget conversation starts to become a little bit easier, because all of a sudden, you’re able to show, hey, in order to do all these things that we’ve been assigned to do, we’re going to need x number of CSMs, which is, you know, an increase of investment here. Then you can start to have more of those conversations around, okay, what do we actually want this team doing? And how are we going to fund them to do that?

CS performing above expectation

Irina 35:05
What does the CS team need in order to be performing above expectations? What are the minimal things? What does an executive leader need to offer to his team in order to make sure that it is performing? By constantly advocating for what they do visibility and communication besides those other things?

Parker 35:32
Yeah, so to be performing above expectations, it’s not dissimilar from the ops and the data conversation. I think you want to lead with how can you enable them to be able to perform their job with as few distractions as possible? So it starts with the operational infrastructure. Is, do they have the tools in place that they need in order to be able to perform their duties? Do they have the air cover needed at an executive level and the support that they need in order to be able to again, focus on their tasks?

I think that’s it, especially now, there’s a big conversation around digital CS and the growth of this need to be able to scale Customer Success operations to customers at scale, customer success execution. That all starts with technology, it all starts with operations, and it all starts with discipline. So it really does. You do want to put the customer success managers in a position where they can leverage their natural skills of intuition and discovery and working with customers to help to guide them through a successful journey. Without this burden of distraction.

Irina 37:02
You’ve mentioned the mistake of not hiring CS Ops on time. And that to a learning. Are there any other mistakes that turned into a valuable learning experience besides this that are worth mentioning?

Parker 37:24
Let’s see. I would say, I mean, that certainly was the biggest one for me in a recent term. I think, from a personal standpoint, as a leader, you have to set a tone for the team. So I would say, you know, I mentioned burnout earlier, it’s a very real problem, I think, for CS leaders out there, because they’re trying to make ends meet, they’re trying to, again, reduce the burden on their teams. For me, I wish I had done a better job of managing that for myself personally. Because it really does sneak up on you quickly. And once you’re kind of in that world, it’s hard to really come up for air. So that’s one, you know, personally, for me, I learned this year, as a sort of a hard lesson, I guess.

But it’s important when you’re thinking about the culture that you’re creating. If you are working nights and weekends, it sends a very clear message to your team, even if you tell them, “hey, I might be working nights and weekends, I don’t expect you to,” there’s still this pull for them to try to, you know, rise to the occasion and, and try to do what they think is expected of them. So I do think that there’s a personal responsibility that CS leaders have to set the right tone within the culture of their team to make sure that the rest of the team isn’t inadvertently following their example. And as a result, burning themselves out.

Irina 38:56
Besides this, any other piece of advice you would offer to CS executives who can learn from your own experience and lessons learned?

Parker 39:07
Yeah, I think so. Customer Success has a wonderful community. It’s so great that it’s a very supportive community. I think because of the nature of just kind of the role that we’re in, we’re very empathetic, we’re very giving, we’re very sharing, and want to solve problems. The trap of that is that we tend to get very insulated within that community. And so I think it’s really important for Customer Success leaders to extend their knowledge outside of customer success. So, and for customer success managers as well, is really understand business, general business. You know, build your business acumen, meet with, for example, your CFO, and learn about finances and understand a little bit more about how the organization’s books are kept and things of that nature. You know, really try to extend beyond the customer success movement, if you will, in discipline, and really seek out other leaders. We talked about product earlier, understand what it means to go through an agile release process, understand some of the challenges that a product manager has, in terms of what they’re going to accept into the roadmap and what they’re not going to. Like, really look beyond just the customer success angle or view on that, and try to understand the other aspects of the business. Because at the end of the day, our role is really helping our customers achieve their business outcomes. And the more you can understand business in general, the much better equipped I think you are in order to be able to do that.

Irina 40:42
As we wrap up, I’d love to hear your thoughts on the future. What are your predictions for the customer success industry in 2024? Are there any trends or changes, you can see that we should all be keeping an eye on?

Parker 40:55
Hmm, oh, I hate to end on a sour note. I think 2024 is going to be a very challenging year for renewals in particular, and then as a result, on Customer Success teams. So again, going back to that perfect storm we were talking about at the beginning, I think there’s a lot of pressure on CS teams right now. I think there’s a lot of pressure on, in particular, point products that have not demonstrated a very clear ROI. So the advice I would give to leaders right now is that they should very urgently be working with their teams to prepare for very tough renewal conversations over the next year. Because I think that tools are going to get consolidated, I think that companies are going to get very careful about where they’re spending their money. And as a result, this is, again, kind of the first time customer success has really been through a long economic downturn. We just don’t really have a lot of the skills and preparation, I think, ready for that.

So we’ve managed customers in pretty good times for the last decade or so. This is definitely one of those points in time where customers are going to be a lot harder to renew. So getting teams to help their customers articulate the value of the product in a measurable way is probably one of the best tactics that we can use at this stage. Because if they can articulate the value, if they can articulate the value in a way that impacts their business in a positive way, those renewal conversations will be a little bit easier. But I do think that it’s going to be a bit of a tough haul over the next year.

I mean, I was talking with a buddy of mine who was giving me an example of a new CIO, I think it was, who came into his organization, went down the list of all the technologies that they had, and basically saw Zoom, and they saw Teams, and everybody liked Zoom. But because they’re a Microsoft shop, he just crossed it right out and said, by this time next month, we’re off of Zoom. And it wasn’t that Zoom wasn’t doing a great job. It wasn’t that the team wasn’t getting a lot of value from it. It’s just that it was redundant to something that they were getting pretty much for free from Microsoft. So those are the sorts of decisions that are going to happen. And it’s not going to be popular, but it is going to surprise a lot of organizations if they’re not ready for that.

Irina 43:37
Alright, Parker, thank you for sharing all those insights to us and for taking the time to talk to me today. Since it’s almost the end of the year, I want to wish you happy holidays and take the time to recharge and we shall see what 2024 will have to offer for customer success.

Parker 44:00
Awesome. Thank you Irina, this was a lot of fun. I appreciate it.

Nicoleta Niculescu

Written by Nicoleta Niculescu

Nicoleta Niculescu is the Content Marketing Specialist at Custify. With over 6 years of experience, she likes to write about innovative tech products and B2B marketing. Besides writing, Nicoleta enjoys painting and reading thrillers.

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