My two previous customer success articles have discussed the purpose of customer success and outlined some of the things which can help you achieve it. This third article in the series focuses on measuring both the effectiveness of your CS team and the success of your customers.
What to measure
There is a theory that you cannot improve what you cannot measure. While I don’t entirely subscribe to this theory, it’s clear that you cannot measure IMPROVEMENT in something you cannot measure – so we really need a way to measure customer success if we are going to improve it.
In fact, there are two things we need to measure. We need to measure the customer’s perception of success, and we need to measure the customer success team’s contribution to that. They are not the same thing, but ideally, they should be closely related.
Measuring the impact of the customer success team is, in fact, the easier of the two. It’s not a perfect science, but it can be defined and measured relatively easily. Yet it must be said that a lot of organisations get this wrong.
- What do you want the outcomes to be? What is the purpose of customer success for you?
- What outcomes can the team reasonably influence? There’s no point in measuring things they can’t change.
- What counts as improvement in the things they can influence? This has to be measurable!
I’m not in favour of agonising about whether an improvement was a direct result of the customer success team’s actions – improvement is improvement.
I very definitely am in favour of motivating the CS team to ensure that improvement happens and continues to happen.
I very definitely am in favour of motivating the CS team to ensure that improvement happens and continues to happen. Remember PPPP – Pay Plan Predicts Performance. Set achievable targets, and make sure that they are what you really want to happen.
In the first article of this series, I defined the purpose of CS as essentially three things: setting customer expectations of the value they would achieve and the steps they would need to take to achieve it, building a relationship with the customer to understand their business and their goals, and achieving specific customer goals so that they can show success. Let’s take those one by one and see how we might measure success.
Setting expectations and agreeing on steps
This can usually be measured by agreeing on a plan with the customer. Such a plan might be based on project deliverables, on a maturity model for longer-term growth, or even on a strategy for automation and transformation of business processes. The key points here are that the plan should be agreed upon, the objectives and responsibilities should be clearly defined, and there should be target dates for various outcomes such as solution delivery, staff training, and achievement of 50%, 80% or even 100% migration to new processes. These should translate easily into objectives or KPIs for the customer success team.
Building a relationship
This is a softer target, and while it can partly be measured objectively, it probably also needs to include a subjective component. Like the measurement of marketing leads and touchpoints, it’s quite easy to count the number of contacts in an organisation and the number of emails or meetings or attendances at events, but this doesn’t really tell you how the relationship is perceived by the customer. Direct customer feedback, by asking explicitly in a questionnaire or making a request for a reference quote, or even just a call between executives, is a better way to get a feel for the customer’s view. Such a direct approach may also strengthen the relationship, and it can provide an opportunity to improve things if there are any problems. From the supplier’s perspective, it’s also important to define clear outcomes from building this relationship – such as a joint case study, access to higher management, or involvement in budget planning – but calling these out to the customer is not always a good idea.