Last week, I spoke at the Customer SuccessCon West conference about calculating ROI for customer success programs. (Thanks to all who attended: what a crowd!)
While we eventually constructed a model together (I will get to that in future posts), the first component of the discussion was why ROI analyses do not work so well for customer success.
- ROI analyses require comparing before and after states, or approach A versus approach B, while customer success is usually an either/or condition. So you can calculate the ROI of, say, moving to group onboarding, but it’s awfully difficult to show the return of the customer success program as a whole.
- ROI analyses focus on quantitative financial benefits, leaving out qualitative benefits. How do we (honestly) capture the value of a wonderful success story? Not everything of value can be monetized.
- ROI analyses struggle to capture long-term benefits, and customer success is often about the very long term. It’s possible to create ROI analyses for any length of time, but it’s rarely done.
- ROI analyses may not be appropriate at all for “hygiene” functions. Have you ever seen an ROI analysis done for the product team as a whole? No, because we all know and accept we need to develop products.
Before you jump into an ROI exercise for customer success, think about the limitation of the approach. Add a comment to share your experience with ROI.
Can’t wait to hear about the rest of the presentation? I will gladly send you a copy. Just ask!
Is your customer success organization making a difference? Can you justify an increased investment in customer success? Is the new onboarding program worth the effort?
More and more, customer success leaders are being asked to justify their existence through an ROI (return on investment) analysis. On January 12th, I will answer these questions at the Customer SuccessCon conference in Oakland, CA. I will show how to evaluate ROI requests, how to perform ROI analyses for customer success initiatives, and how to provide alternative evaluation approaches.
Join me at Customer SuccessCon West on January 12th, 2017. See the full schedule here.
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to the December 2016 issue of the FT Word! Topics for this month:
FT Works in the News
Coming in January: a brand-new soft skills program for support engineers
After 18 years of rave reviews, the Managing Customers workshop is getting a complete rearchitecture, and a new name. Specially designed for engineers that support complex support, the workshop will be organized around five big themes that incorporate even more hands-on and interactive exercises to maximize learning. Watch this space in the January newsletter for more details or ask for more details (and a spot on the schedule) now.
Curious about something? Send me your suggestions for topics and your name will appear in future blog posts and newsletters.
Until next month,
650 559 9826
Curious about something? Send me your suggestions for topics — or add one in the comments — and your name will appear in future newsletters.
650 559 9826
About FT Works
FT Works helps technology companies create and improve their support operations. Areas of expertise include designing support offerings, creating hiring plans to recruit the right people quickly, training support staff to deliver effective support, defining and implementing support processes, selecting support tools, designing effective metrics, and support center audits. See more details at www.ftworks.com.
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While some of us are enjoying warmer climes (guilty) or stuffing ourselves, you are working. Thank you for taking care of business for us.
It’s pretty quiet this week in most support organizations, so this is a great opportunity to take care of important, but never urgent tasks. Exhibit A: the staffing model. When was the last time you worked on yours? If it’s more than a few months, take a moment to reacquaint yourself with this central tool and ask yourselves these 5 questions:
- Do you have a quantitative support model based on customer/case load?
- Have you validated it against recent metrics (last quarter’s)?
- Do you properly forecast headcount by role (e.g. enterprise CSM vs. SMB CSM or support engineer for product line A vs. product line B) and not by specific assignment (e.g. first shift of product X vs. first shift of product Y)? Headcount planning for tiny teams is doomed to errors, and is also a lot of work.
- Are you actually operating close to your model, including open reqs? If not, the model is a headcount wish, not a headcount model!
- Is the model simple enough to be understood, and ideally driven by the average line manager? Complicated models dilute adoption, and adoption drives improvements.
Go ahead, take a few hours to improve your model and to ensure that you are collecting the essential metrics to drive it: customer base numbers, productivity, time on task. It’s really not that hard!
(If you’d rather not start from scratch, see here.)