Pulse2016 Making the Case for Customer Success in the Fortune … · 2019-09-16 · Making the case for Customer Success Expected Value Poor Selection and Prioritization Inefficient

©2015 Gainsight. All Rights Reserved.

Making the Case for Customer Success in the Fortune 500

RICHELLE DEVEAUAccenture


Your panelists

• VP, Global Consumer & Business Sales

• Fun Fact: Worst job was cleaning a dental office every night for 3 years in high school

• VP, Global Customer Success

• Fun Fact: Once detained for 24 hours at LHR as a suspected terrorist

• Rob Giglio, AdobeLaura Fay, BlackBerry

• SVP, Business Transformation

• Fun Fact: Just had 3rd boy and had forgotten how tiring a new-born can be!

• Customer Success Leader

• Fun Fact: One of his jobs during college was as a school bus driver

• Tim Willey, SymantecDavid Kocher, GE Digital

Rob Giglio, Adobe

Tim Willey, Symantec


1. TELL US ABOUT YOUR SHIFT FROM PERPETUAL TO SUBSCRIPTION / SAAS


The Journey from Perpetual to Subscription

80% Revenue recognized…

At the time of contract execution Over the contract term

Primary Business Metrics

Licenses SoldService Renewal Rate

Annual Recurring Revenue (ARR)Active Users

Customer Relationship Transaction Focused Success Outcome Focused

Marketing Customer Success

Marketing & Case Studies èLicense Sales

Adoption Success / Value èRetention, Renewal and Expansion

Perpetual Business SaaS Business


The Journey to Security-as-a-Service

The 3S Transformation Program

Offerings

Go-To-Market Process&Systems

SaaS

Solutions-led Subscription


2. HOW DID YOU MAKE THE CASE FOR

CUSTOMER SUCCESS?


Making the case for Customer Success

Expected Value Poor Selection and Prioritization

Inefficient Project Execution

Poor User Adoption

Realized Value

100%

5% – 10%

10% – 15%

35% – 50%

25-50%

Choosing the Right Solution Delivery/User Adoption Realizing Solution Value

Source: AMR Research, Forrester, Butler Group

The focus for Customer SuccessBusiness Outcome and Value Realization


Making the case for Customer Success

• Be more clear about what ‘customer success’ means in this context is first

• For Adobe we have slowly added roles focused on the key components of success –Customer Success Teams focused on deployment/use/renewal, Analytic Teams focused on product use and retention, and Retention Marketing focused on regular product engagement

• The prior org structures still work with small tweaks


3. HOW DO YOU PAY FOR CUSTOMER SUCCESS?


How do you pay for Customer Success?

Initial results from Australia Pilot – delivering 5-6X increase in CLV!

CustomerLifetimeValue

Expand

Retain

CosttoServe

Acquire100%IncreaseinNewCustomers

20%Reduction indiscounting150%IncreaseinProductspercustomer

25%ReductioninChurn

“… a very positive experience in helping us to

better position a ‘New Symantec’ in an 'old

customer’ …”

“The philosophy behind 3S has really helped…to align us to customer’s language of consolidation”

“…in terms of transacting, now that we have 3S in place, ongoing transactions are a lot simpler…”



• We’re taking a phased approach to paying for Customer Success• Initially we’re investing in Customer Success focused on a subset of

customers• Activity with these customers will be tracked to define:

• A core set of value added offerings• Economic value proposition to substantiate offer

• Once offer defined, we will begin providing success to those customers that pay



• Historically it varied. In the 3 software entities (Good Technology, Watchdox, AdHoc) making up Blackberry Software business each had different approaches based on where each was in their subscription business model journey. Approaches varied…

• A: Invested in Customer Success, starting with largest and most strategic customers. • B: a % uplift to the product subscription, across all customers• C: A paid Service ‘Enterprise Success Manager’

• Now: • Customers realizing the value in ongoing partnership, sharing of best practices, planning and

adoption strategies.• Future funding model evolving based on experiences to date moving more and more in the

direction of paid service / % subscription as proof points of customer value realization continue


4. IN WHICH FUNCTION SHOULD CUSTOMER

SUCCESS RESIDE?


In which function should Customer Success reside?

• Customer Success is now everyone’s responsibility

• However we have created dedicated groups which focus on the components of customer success within each key function

• Customer success is measured by retention and value expansion



Traditional ‘Supply Chain’ Customer-centric agile delivery

Engineering/IT build platform, develop features

Marketing drives campaigns and upsell

Sales and Partners focus on customer outcomes

Automated systems and operations ‘easy-to-do-business’

Customer Success tracks adoption and usage

ConstantCustomer

Engagement

Marketing Sales SupportProduct

Development



• Above is how BBY is aligned

• Goal to gain fluidity and consistency across elements of the customer lifecycle• Land, Onboard, Implement, Adopt, Renew & Expand

CEO

President, Software Business

SalesProfessional

ServicesCustomer Support Customer Success



• This is how GE Digital is structured

• Structure works well because it aligns success with commercial org and/but is in same org as all post-sales service delivery

• Allows us to impact full customer experience

CEO

Chief Commercial Officer

Customer Success Officer

Professional Services Managed Services

Education Services Customer Support

Customer Success


5. HOW DO YOU CREATE AN INCENTIVE MODEL

FOR CUSTOMER SUCCESS?


How do you create an incentive model to maximize the return on your investment?

Core Capabilities Onboard Adopt Renew Expand

Component

Activities

Service

Enablement

Usage Analysis

& Outcomes

Proactive Renewal

Management

Identify Upsell

/ Cross-sell

Activity

Metrics

Activation

and Usage

Utilization and

Outcomes

Renewal %

and Churn $

Lead

Generation

Accountability100%

Accountable100%

Accountable25%

Responsible50%

Responsible

Product / Industry

Mixed coverage of four Success Delivery capabilities:

Customer Success Managers

Commercial / Sales

Support / ServiceConsultative / PM



• To recognize the importance of recurring revenue, important for sales leadership to be commissioned on some recurring revenue elements as a well as straight billings. Particularly important to drive right behaviors when transitioning from a perpetual business model to a subscription business model

• For Customer Success team members, the structure is MBO with a focus on leading metrics

• Active Users• Loyalty (AKA Stickiness) Index • Lower Incident Trends• Expansion Opportunities



0

50

100

150

Year3Year2Year1

Maintenance

License

$

Maintenance Maintenance

0

50

100

150

ARR

Year1

ARR

$

TransitionMove fromhigherupfrontrevtorecurringoverlongertimeperiod

ARR ARRARR

Year2 Year3 Year4 Year5

Perpetual License + Maintenance Recurring Subscription

ü 2-3X+ quota retirement during transition

ü Pay on net-new only

ü Consider 100% attach-rate for Customer Success offerings


6. HOW DO YOU SCALE YOUR CUSTOMER

SUCCESS FUNCTION?


Organizing Customer Success for Scale

Account Coverage by CSM CSM Coverage Scenarios

• At Risk and New/Expand/Nurture accounts will receive prioritized alignment with Customer Success Managers

• Cull and Maintain Accounts will by served as High Tech Accounts via virtual CSM

• Only those accounts with value >$200K will receive designated CSM coverage

• Below $200K, customers will be served by escalation queue and virtual engagement

Value

Hea

lth

Expand Accounts

At RiskAccounts

MaintainAccounts

CullAccounts

Low High

Low

Hig

h

NurtureAccounts

High Touch

Vertical Specialization

Low Touch

Proactive Management

High Tech

Virtual CSM & Escalation Queue

CSM Ratio | Value

Des

igna

ted

Ow

ners

hip 1:6 | $500K+

1:15 | $200KNew


Q&A


THANK YOU

Documents

Pulse2016 Making the Case for Customer Success in the Fortune … · 2019-09-16 · Making the case for Customer Success Expected Value Poor Selection and Prioritization Inefficient