- Road maps
- My car (during Covid-19)
There are legitimate reasons for society and the business world dropping the use of one thing and embracing another and almost always it boils down to utility, which I will describe as the usefulness of something. Sometimes, though, something loses popularity or is less popular even when it offers real value or usefulness. Why? Because it presents a challenge in some form or another…. a challenge in cost or convenience (compared to an alternative), for example. Or it presents a challenge to some aspect of the greater good of society or to powerful interests.
- A manually operated can opener (convenience)
- Longform writing (time and attention cost)
- Incandescent lighting (acts against society’s interest to remediate the effects of climate change)
- Bicycle lanes in cities (act against interest of suburban dwellers and politicians)
To this list I need to add the Customer Health Score.
For the uninitiated, the health score is a way that Customer Success organizations measure the temperature of a customer. It is a calculation of the aggregated output from a number of variables and is a report of how the customer feels about the product or service to which they subscribe.
Sounds straight up, right? Kind of benign? I mean, what’s wrong with collecting information to understand your customer better? Nothing. But then why did Deloitte find that less than half the companies having formal customer success practices are leveraging health scoring as part of their tool kit?
It can’t be because it’s hard
Health scoring should be seen as algorithms that are just looking at signals and calculating a score based on what they can measure. Simple math. Except, it’s not when you succumb to the ego and begin applying your own judgement to what should be a purely objective exercise. The purpose is to understand the customer by addressing any gaps in your knowledge of them. As you improve in your ability to rely on the health scores, your knowledge of them will increase and the amount of subjectivity within the scoring should rapidly diminish to zero.
The variables I mentioned earlier often show up in a basic set that looks like this:
- CSM personal assessment of the account
- Support tickets
- Sentiment (NPS, CSAT, CES)
- Product usage
- Existence of executive relationship
That list sometimes expands to include an intermediate set of variables like these:
- Mail click through and response rates
- Success plan goal progression and achievement
- Subscription state (how much have they deployed/adopted)
- Status of consulting projects
- Partner involvement
- Community platform engagement
An advanced collection would be built on those and might include these:
- Customer’s industry
- Customer skills
- Governance and compliance implications
- Customer profit and growth trajectory
- Capacity and skills of customer success practice
While some of the variables are challenging to establish, the overall goal again should be to minimize, or eliminate altogether, any subjective measurements. Objective measurements enable the most difficult aspect of health scoring – what happens next – and this is the area where I think most companies are weak.
Spreading the wealth
The power of health scores is very small if it is contained within the customer success team. What they do with the insights matters but only to a limited extent. They can only affect their own processes and behaviors and so the impact of the score will be minimal. For maximum effect, the health score should be widely shared internally and, more radically, with the customer. Here’s why I think each offer enormous transformation potential.
When a customer success practice builds a sophisticated health scoring algorithm (beyond basic) and fully believes in its objectivity it needs to share that with other internal teams. Why? Because information is the only real enabler of success when working with customers, whether it’s sales, marketing, support, or service. All customer-facing teams try to do what’s right for the customer but invariably they don’t have equal access to all the right data and the people who can shed light on things. Customer success has that access. The trouble though is that a lot of controversy is generated when you’re truly good at health scoring. People don’t like what they see and hear. And since customer success is still, more often than not, the junior partner in any corporate relationship it feels it has to dull the shine on what it finds in terms of insights. And that’s why we find health scoring to be a once popular thing in our industry but one that’s been largely marginalized because of the potential it has to trigger internal tensions. The way to get around it? Share the score with the customer.
You already have a relationship with the customer so what’s stopping you from sitting down with them and talking about how you’ve scored their health? Who says how you measure them needs to be an internal-only conversation? How great of a test would it be of the confidence you have in your health score if you had to put it in front of the subject you’ve scored and be forced to defend the findings? If you’re confident in your methodology and believe that the data you’ve collected is accurate there’s no reason that revealing it should do anything but stimulate strong conversations with the customer. You might be surprised to find that…
- Maybe they weren’t aware that their community engagement was minimal compared to their industry cohort
- Maybe they weren’t aware that their product usage surfaced concerns on your side that they weren’t adopting the right set of features that could accelerate them towards the goals they’ve described in the success plan
- Maybe they weren’t aware of a new rule from the federal or state government that affects how soon they need to fully adopt a feature of the HCM solution
- Maybe they weren’t aware that the persistent correlation of high number of support tickets a particular module with the history of training credits consumed points to a weak understanding of how to best use the module and that deeper and different training could rectify it
Customer health scores should be instruments for radical change
Safe and opaque – Don’t do this. Keeping the health score to yourself does nothing for the customer success practice, nothing for your company, and nothing of substance for the customer.
Assertive and transparent – Do this. If you want to truly be an agent of change, use the health score to drive internal conversations that can expose vulnerabilities, deficiencies, and opportunities in how teams go about understanding the customer and what impact their efforts are having on the customer in the end.
Less than one half of customer success organizations utilize a health scoring process. Why not embrace it? Why not put it front and center of your strategy? Why should the prospect of internal or external tension prevent you from doing this? If you believe in your findings what’s the worst that could happen? Gaps are revealed?
I’ll close with this. I listened to this CBC podcast the other day and in it the astronomer, Priya Natarajan, said when she studies the black holes and dark matter of our universe she’s looking for gaps in knowledge because the “gaps reveal very, very important things about the very beginning of existence.”
That’s what we should shoot for – finding and sharing the gaps in our understanding.