How does the CS organization measure its predictability in success?
In this interview, Jey Govindan, Sr. Director of Customer Services and Operations at Kong Inc, talks about why Customer Success should be an integral part of any company’s strategy. Without CS being part of a company's growth and expansion mindset, (mutual) success is unlikely to be achieved.
Background and Career
Jey has been in the customer-facing, post-sale service leadership roles for close to two decades working for both startups and enterprises. She focused on big data technology companies in the last ten years, supporting and servicing their customers. She is meticulous about customers’ end to end experience and validates that with a data-driven approach. Her passion for data science and analysis helped her gain very useful and actionable insights to serve customers right.
Jey says, every function of a business (ie. support, engineering, marketing), need to have a clear articulation of how their KPIs connect back to the bigger goal of any company, which is their customers’ true success. Needless to say, no customer, no business!
Critical component of success
Given the challenges in today's business landscape, Jey points out that it is critical for companies to do their best to retain their current customers. There are two key reasons. (1) It is a well-proven fact that it takes more effort and resources to acquire new customers than to keep the ones you already have. (2) Over time, successful, healthy companies derive over 60% or more of their revenue from existing customers.
In corollary, when a company’s revenue is largely from acquiring new customers and the churn rate is higher than their peers in the industry, it could also mean that the company has not turned their customers into an active and valuable customer base. An exception to the above are startups that have been around only for a few years.
Now, the very first step to achieving any of these goals is having a good pulse on your customers. That means knowing how they are using your product, what value they are getting, or not. This is where CS comes to the rescue, by being the enabler for both the customer and the company. Jey adds, when that call happens, don’t be shy to remind your customers that you are there for them and stand by your commitment.
When it comes to keeping in touch with the customer, whether to use digital, human, or a combination of both, is largely influenced by the maturity of your product, the growth phase of the company, and the available human resources. Irrespective of where a company is in its journey though, investing in a good customer success management solution sooner than later helps to (1) optimize your activities with your customer, (2) get your cross-functional teams all on the same page and (3) start building the data you need to recognize patterns and insights. An additional benefit is that you will definitely come across mature and organized to your customer.
Keeping a close pulse
Jey further explains the details of this methodology in the following paragraphs. In general, certain factors as listed below are good indicators for a company building a valuable customer base. They are (1) Customer health-related metrics, (2) Touchpoints and outcomes from business reviews with the customer, and (3) Cross-functional team alignment to meeting customer’s needs.
Customer health metrics
Typically companies measure various metrics like below and bubble them up into a single customer health score. Top factors include:
Support case metrics - Support cases reported, close rate, aging of issues, case escalations, and time to resolution.
Customer surveys - Customer Satisfaction Score (CSAT), Customer Effort Score (CES), and Net Promoter Score (NPS).
Product adoption score - Derived from factors like production-live, seats bought vs. used, traffic units bought vs. used if metering, etc.
Time left to renew. The closer the date is to the renewal, the higher the risk of churn, and so on.
Touchpoints and outcomes:
Service engagements. Add points to the health score for service engagements carried out (e.g. training, professional services, etc) since this might be a good indicator of a customer's further investment in the product.
Business reviews. Value-based customer outcomes are reviewed in these meetings, among other items. Most companies conduct quarterly business reviews with their customers. Other than activities and follow-ups on customer outcomes, a company outcome from this review is a customer sentiment assessment. This is your gut feeling of whether a customer is happy or a potential risk.
It is a good practice to keep not more than 5-15 metrics leading up to the health score. For finer calibration, these measures can be assigned a weighting as well.
“In summary, the more appropriate the metrics you measure, the more reliable your indicators will be of customer behavior and success. This balances how your overall goals should be met,” highlights Jey.
Cross-functional team alignment
While the above indicators are derived from what happened in the past, it is critical for CS to influence future outcomes by constantly liaising with cross-functional teams (e.g. Product, Engineering etc). This is to ensure that (a) customer’s needs are met, (b) alternate solutions are figured out, or (c) articulated and understood by the customer on why their request might not be met. This diligence helps build trust.
Enabling for success
Customers start their journey with a company because of the perceived value of their business from using the product. “Having a good product helps. However, unleashing its full potential for the customer is a collective responsibility, mostly carried out by post-sale service teams like Support, Professional Services, Technical Account Management etc. Therefore, enabling service teams is an important cornerstone to enabling product value, ”Jey points out. Remember, the VOC influences the product roadmap and its future value.
When the product value is complemented with the service provided, your flywheel accelerates to greater success.
Final thoughts
Success is a mutually agreed-upon outcome. However, the CS role is much more than just conducting business reviews, keeping a tab on events, or communicating what worked and didn’t work for the customer. But obsessive commitment to providing demonstrable, value-based outcomes for the customer is paramount to predictable financial success for the company, Jey emphasized.
