A discussion on the first of fourteen tenets (or principles) of customer success management, as laid down in Chapter One of the book “Practical Customer Success Management”. The first tenet is “The CSM Exists to Create Value for Their Own Company”
The 14 Tenets of Customer Success Series – Tenet 1: The CSM exists to create value for their own company
This short article expands upon the first tenet (or principle) in my “14 Tenets of Customer Success” that are taken from my upcoming book “Practical Customer Success Management: A best practice framework for managers and professionals” which is due for publication summer 2019…
Tenet 1: The CSM exists to create value for their own company
In my book – Practical Customer Success Management: A best practice framework for managers and professionals – I set out 14 tenets (or principles) by which customer success managers can carry out their professional duties. All 14 of these tenets can be found in my LinkedIn article – The 14 Tenets of Customer Success – which can be viewed here:
This first tenet is:
The CSM exists to create value for their own company
Its definition is:
The reason why your company has decided to invest in customer success management (either as a fully-fledged, separate department or as tasks to be performed by people in other existing roles such as customer services) is because it expects to see a financial return from that investment. Usually this financial return comes from increased product/service sales and contract renewals from customers, but it may also include additional customer advocacy levels and/or a deeper understanding of customer needs to help with product development
What do I Mean by This?
What I am getting at is that regardless of whether or not the services of customer success managers are charged to customers in the form of “professional fees” or “billable services”, the principal – indeed arguably the sole – reason for the existence of a customer success department is to increase revenue growth and profitability for the CSM’s company.
The bottom line is this: running a customer success management team costs money in staff and equipment and takes up valuable management time to run. Those precious resources of time, money and equipment are all finite in size, and could potentially be deployed in other ways – for example by employing more salespeople, by running a social media marketing campaign, or by providing further training for the customer support team. Why would the senior management team decide instead to invest those resources on funding and managing a customer success department? The answer has to be because they believe that doing so is in the best interests of the company because it brings back the greatest possible return on investment by doing so.
Why is It Important?
For senior leaders this focus on a return on investment is going to be self-evident, but this is not always the case with customer success managers themselves – indeed far from it. This is because CSMs are recruited and trained to help deliver value to the customer and they live their professional lives doing exactly. They are asked – indeed required – to be customer-centric in their thinking and to put the needs and desires of the customer foremost in their minds. In effect, the CSM is not just the CSM’s company’s ambassador to the customer, but also becomes the customer’s ambassador to the CSM’s company. This should hardly be surprising since they represent the customer’s interests in meetings, they fight for allocation of resources on behalf of the customer, they help the customer with onboarding, adopting and measuring value from the products and services they purchase.
Now this is all good stuff, very good stuff indeed. If done well, the customer gets access to the resources and expertise they need, they get to onboard and adopt products and services more quickly, more efficiently and more effectively, and the measurable results from using the products and services they purchase come more quickly and in greater quantity. But the bottom line for the CSM’s own company is this: Does this value that has been created and delivered to the customer result in additional value being created for the company, and if so how much value is being created?
Do All Activities Create Equal Value?
So here’s the thing: There are many, many activities that CSMs can choose to get involved in, but to my mind each CSM should be constantly in mind of Tenet 1: The CSM exists to create value for their own company and should be continually asking themselves not just “Is what I am doing the best way to create value for my customer?” but also “Is what I am doing the best use of my time in terms of creating value for my own company?”. Both questions are important. Some activities may generate value for the customer, but not the for the CSM’s company. Other tasks might generate value for the CSM’s company, but not for the customer. There is no simple answer, rather it’s up to the CSM to determine whether each action is the right use of their time and efforts, given the needs of both companies and the unique circumstances of the situation they happen to be in.
Do You Have a Success Strategy?
One final thought on this topic – if you are a CSM do you know your own company’s strategy for customer success (assuming it has one of course )? And based upon that corporate customer success strategy, what is your own strategy for customer success? In other words, what is the basis upon which you make your decisions about how to spend your time and allocate resources? If you do not have one, or cannot clearly define it verbally or in writing, then shouldn’t you?
For more on how to create and make use of a personal customer success strategy please read my book “Practical Customer Success Management: A best practice framework for managers and professionals” which will be available this summer.
Next Week’s Tenet: “The CSM’s primary task is to help customers attain measurable value from using their company’s products and services”
The next article in this series will be on Tenet number two which is “The CSM’s primary task is to help customers attain measurable value from using their company’s products and services”. This of course very much gets to the heart of what a CSM is and what they do, and I look forward to discussing it in more depth next time.
About the Author
Rick Adams is an independent author, trainer and consultant, specializing in helping technology companies deliver measurable business value for their customers. Adams has over 25 years’ experience of working in the IT industry, including owning his own startup software-as-a-service business which he sold in 2012 to focus on writing, training and consulting. Having delivering training and consultancy to many hundreds of businesses and thousands of technology professionals in over 30 countries across four continents, Adams is now based in the rural west coast of Ireland where he lives with his two dogs Zeus and Terri.
Adams’ recent work includes the development and delivery of a global certification program on customer success management for Cisco Systems Inc. He is currently working on a book titled Practical Customer Success Management: A best practice framework for managers and professionals which will be published by Routledge in the summer of 2019. His current interests includes helping individuals and companies develop best practices in customer success management and in business outcomes focused selling.