UpdateAI – Zoom meeting assistant

Chris Hicken is sounding the alarm. While the customer success world has quickly expanded over the last decade, that doesn’t guarantee the boom will continue in the years to come. 

“If customer success isn’t proactive right now,” Hicken recently told Update AI’s Josh Schachter on the “Unchurned” podcast, “it will be a much less important department in 5 years.” 

In other words, you’re either growing or you’re dying. 

Still, that doesn’t mean Chris is bearish on CS; no, he’s actually incredibly optimistic when it comes to CS – but he wants to make sure CS leaders and companies are doing their part to help the industry evolve. That’s what he’s focused on each day as the co-founder and CEO of ‘Nuffsaid, which enables companies to increase net retention by measuring the value their customers receive and delivering actionable insights and CS playbooks when risks or opportunities are detected. 

On “Unchurned,” Chris shared his macro view of the industry – including the challenges facing CS professionals right now – as well as his game plan for putting customer success leaders in a position to thrive in the next 5-10 years ahead. Here are a few key takeaways from his conversation with Josh, and be sure to listen to the full podcast by clicking here

The Big Problem Facing CS

CS departments have become much more common, if not ubiquitous, in recent years. And that’s a good thing, obviously. But the issue facing most CS departments is this: they don’t have a key metric they can point to that shows they’re delivering for the business.

Sure, there are plenty of numbers and metrics tied to CS: time to value, customer health score, net retention rate, NPS, and CSAT. They’re important – but none of them appear on a CEO’s morning dashboard. 

As Chris told Josh, without a linchpin metric to “own,” CEOs do not “value [CS] in the way I think it should be.” 

The perception at many companies is that the CS department is a group of nice people who are nice to customers – but who aren’t necessarily integral to the business. That’s a problem, because perception is reality in this case; when executives look to trim fat during economic downturns, it puts CS professionals at greater risk of being cut. 

 With the economy taking a hit this year, this is something that must be taken seriously among CS professionals – and why a go-to metric is essential for CS to become bulletproof. 


The Metric CS Departments Need to Own

As the old saying goes: Play to your strengths. And the best way to do that, Chris said, is for CS leaders to make product-market fit their anchor metric. 

If you’re not familiar, product-market fit is where a company’s customers are buying, using and telling other people about its product so much that it feeds the product’s growth and profitability. The metric is credited to Marc Andreesen, the co-founder of Netscape and famed venture capitalist behind companies like Facebook and Twitter.  

CS leaders are best positioned to own this metric, Chris believes, because they’re the only people who have a full view of the entire customer journey with a company. 

They’ve seen what happened in the sales process, what the customer’s experience with the product has been, how they feel about pricing, how they feel about the company’s positioning, and how technical bugs may have impacted their journey, among dozens of other factors. There are about 50 core experiences a customer goes through, and the CS leaders have the best understanding of that composite picture. 

This is where they play to their strengths. How? By creating a scorecard that rates the quality of a customer’s experience at each of those points. Develop your own scoring system and present it to the executive team once a month. 

“By doing this, you can help the business assess where they’re accumulating risk and where they have opportunities for expansion,” Chris said. 

This moves the CS department from reactive to proactive. The scorecard, coupled with a focus on the product-market fit, puts the CS department in a position of strength – directing resources of the business to improve net revenue retention and the overall quality of the business. This becomes something quantifiable for CS departments to point to. 

How CS Can Leverage a New Operating Model

Chris stressed another important factor in the CS world’s continued evolution: emphasizing customer-led growth, a term he is championing. 

We’ll jump into that in a second, but let’s take a step back for a moment. Wall Street, for the last 5-7 years in particular, has valued companies that can grow efficiently. And most companies have tried to accomplish this via product-led growth – by relying on their product to be the engine that drives the company forward. NEW OPERATING MODEL. 

But that’s been a mistake, Chris said, for the vast majority of software companies, because upwards of 95% of companies don’t have a product strong enough to build on. 

Product-led growth companies require a product that’s “stupid-simple,” Chris said. Most software companies are the opposite, requiring integration, training and onboarding teams to go along with their education departments. That’s the opposite of simple. 

“A new operating model is needed to drive growth,” Chris said. 

That’s why he coined customer-led growth, where a business orients itself around “obsessing around the value delivered to customers.” Under this model, all of a company’s metrics and decisions are centered on this goal. 

By taking this approach, companies are able to avoid the hollow, impersonal sales-led growth motion, he said, where employees only care about the immediate transaction and don’t care about the customers receiving value. 

On the other hand, if you have a team that’s measuring value delivered to the customer and fixated on it day in, day out, you put your business in a better position to succeed; you’re more likely to limit churn, have customers expand their existing commitments, and get them talking positively about your company to others. For the CS industry to continue on the same upward path it’s been on, these are important steps to implement. 

Check out the unchurned conversations to get lessons and tips from the most successful leaders in the movement behind customer-led growth, listen to the full  episodes of “Unchurned.” (Again, you can find the show on your favorite app by clicking here.)