CS Roundtable – Part Two

In a conversation with Lincoln Murphy (@lincolnmurphy) and a group of Bay Area Customer Success (CS) executives last month, we explored several aspects of Customer Success and challenges that companies and CS Executives face. Everyone agreed that CS having a seat at the table is important for companies to be successful (see Should Customer Success Have a Seat at the Table?) and yet, many of the executives who participated continue to have challenges making this happen. There are some good reasons why it’s a challenge to get this seat, and it’s important to understand “why” this happens in order to solve the issue.

Native CS versus Adding CS

The first reason is related to the timing of when the company adds the CS function. Businesses that create their CS teams early in their evolution or plan from them in their initial structures usually provide CS a seat at the table. Companies that add the CS function later in the company’s evolution might or might not have this seat. Adding a seat at the executive table for any function is challenge because it disrupts existing organization structure, which results in change and friction, and people resist change. Furthermore, when a CS function is added, there is a need to redistribute responsibilities which were previously handled by other functions.

Renewals get moved over from the Sales team who may not want to give up that revenue source. Persona and customer journey management come from the Marketing team who may resist expanding the documented customer journeys into the post-Sales realm. Professional Services teams might not want to give up their deployment responsibility, while the Product team may not have room in the roadmap for what customers think that they need in a future release. All of this organizational disruption contributes to why it is a challenge for CS Leaders to get, take, or keep their seat at the executive table.

It’s About the Numbers

Pure numbers are another reason why getting CS a seat can be challenging. The actual number of executives at the table, and the amount of funding available are two numbers that have an impact on CS getting a seat. Current executives don’t want to contend with another voice in the mix, nor share their budget caps that are already tight. CEOs can also find managing an additional direct report challenging, as their time gets more spread out.

Funding is another “numbers” issue. In order to add another executive, companies have to make hard choices about what else NOT to spend on. Investment in product typically comes first, and Sales and Marketing often come next. Customer focus requires an additional investment on top of those three essential teams. Adding a CS function can be costly, and thus not always possible at a time when funding is limited or a company is bootstrapped. As a result, numerical concerns can add to the roadblocks in bringing on a CS executive early in the process, and giving them a seat at the table. Depending on the CEO’s leadership style, the available capital, and his or her willingness to manage the growing team, adding a CS Leader to the executive table doesn’t come easily.

The Right Leaders in the Seats

Our discussion also discussed the fact that in some cases, leaders who had seats at the table have had those seats eliminated or removed. Is it because the company doesn’t value CS as a function? Or are there there purely economic and financial reasons why the role is eliminated? Or is it something else? We discussed two common challenges that relate to this situation.

Consider the possibility that the wrong person was put into CS Leadership. I know this isn’t always the case, but it is a possibility worth examining. In today’s SaaS world, there are some CS executives who are relatively junior for an executive role, and either don’t have the experience, or aren’t able to adapt quickly enough. After all, this is an emerging field and many companies are hiring practitioners and promoting them into leadership or expecting them to be strategic leaders, even though the function hasn’t been around long enough to establish key strategies and best practices.

This is a flawed approach because of the difference between a strong practitioner who manages the day to day, and a strategic executive who creates the long term vision and makes the tough decisions. When you put a practitioner at the table, they may not fully step up to the job. This situation is exacerbated when the individual’s personality type is an empathetic helper. Helper personalities are great to work with customers, and imperative in the CS world, but they may tend to accommodate among peers, instead of stepping up and asking the hard questions that a CS leader needs to ask to ensure success.

Customer Centric Company

The other reason that CS leaders might be losing a seat is symptomatic of a different challenge. Some companies simply lack a customer centric culture. All companies talk about having one, but actions speak louder than words. If there is not a willingness to add a customer focused executive, then what does that say about the priority of the “customer centric” culture? Why do you often see a “Head of Customer Success” when there is a VP of Product, Marketing, and Sales? It’s a harsh reality. Likely it says there is a lower priority, including less budget, less input to strategy, delayed hires, and a myriad of other symptoms that will lead to customer issues down the road.

When you look at the economics of where companies actually put their resources based on what they spend, you often see that the real priorities are on product and customer acquisition, with a very small amount allocated to ensuring customers adopt and renew. Actions speak loudly, and this definitely contributes to why CS leaders don’t always have a seat at the table.

When to Operationalize

The final reason why some CS executives have challenges getting and retaining their seat at the table has to do with taking too strong of an operational focus too early. As is true with any emerging field, it’s important to get the system and process working manually and fully understand your customers and market space before you operationalize. Otherwise, you end up with systems and processes that are driving your business, instead of having your business needs drive your systems and processes. It also makes it harder to scale. Participants mentioned several examples of this including deploying CSM platforms that required complete overhauls after the workable processes were finally defined. It’s best if you can figure out your strategy and work with it before you operationalize it.

You can see there are real challenges to CS having a seat at the table. It is important, and yet there are legitimate reasons why companies don’t regularly include a CS executive. So what can CS leaders do to solve the issue and get that seat at the table? Stay tuned, I will cover this topic with some of the wisdom we gathered from the group in an upcoming article.

Irene conveys the voice of the customer when setting strategy from go to market planning through maximizing customers for life. She creates effective post-sale teams in startups by hiring and mentoring customer focused staff and applying scalable processes that are dependent on business objectives and target markets. With 20+ years of experience, Irene has successfully built and operated multiple global services, support, and customer success teams in the US, Europe and Asia. Most recently she was VP of Customer Success for Cloud Cruiser, a global venture backed start-up providing consumption analytics across hybrid cloud environments. She is currently writing a book titled, Who Speaks for the Customer?

Irene Lefton

Board Member, PSVillage & the Customer Success Network