“We did it that way at my last company” is the worst reason to make changes.
If the founders don’t understand CS, building a new CS program from scratch will be much less effective
CS doesn’t exist to make the customer happy; it exists to drive customer value
Can you please introduce yourself and what you do?
My name is Manuel Harnisch, and I am currently the Vice President of Customer Success here at People Data Labs. Customer Success at PDL encompasses both traditional CSM roles as well as what we call Technical Services, which comprises three major role types right now: the CSE (Customer Success Engineer), SE (Solutions / Sales Engineer) and the SSA (Senior Solutions Architect).
You mentioned that you had taken over a new CS organization twice. Can you briefly describe your experiences doing so? What made each of them unique?
PDL is my second "CS from the get-go" adventure, but I had dabbled in Customer Success at a late stage startup (SevOne) before making the plunge full time. All three companies had some unique challenges but also opportunities.
SevOne very much was still a "box vendor", as in, software sold bundled with hardware to be installed in a customer's data center. Since most customers didn't allow access to the equipment once deployed, "Customer Success" was mostly a break / fix support motion with some occasional enablement.
Kentik got its start in the cloud and immediately recognized the concept of recurring revenue and thus the need for a Customer Success motion. The buyer and user personas had been quite similar to those of SevOne, however, which meant long (6-12 months) sales cycles with a lot of technical hurdles and an ongoing need for technical education, coaching--and sometimes even hands-on configuration on behalf of prospects and customers.
You might say both companies had "heavy technical lifts" and given the nature of the products. A lot of red-tape had to be overcome on a continuous basis in order to maximize value generation.
PDL is my first venture into the DaaS space (data as a service, rather than Software of Infrastructure or Platform, as most "aaS" companies are). Data is very interesting in that it is often a key building block, or ingredient in a customer's own offering.
In comparison, most customers don't directly, or even indirectly monetize services they buy from other vendors. Sure, those services may facilitate the business of the customer, even support it, but they are often just ancillary components. For instance, nobody is going to claim that their Quickbooks Online SaaS subscription is what they are building their business on. That'd be silly, but it is of course an important part of doing business for them.
Data, I've learned, is very different. A lot of PDL's customers directly build their Products either on top of our data sets, or those datasets play a vital role in what they sell to their customers. This is great from an ROI and justification perspective, but given that data (whether delivered via API or bulk file) is more abstract and technical to work with than most products, the technical lift, while different from that of SevOne or Kentik, is still substantial in most circumstances and requires a significant amount of ongoing CS investment.
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What is your first step when taking the reins of a new CS organization?
My first step is generally to understand what is in place and figure out what each member of the team is good at and, more importantly, what they like doing. People are the most critical part of any CS motion, so I tend to over-index on this and really make sure everyone either feels comfortable in their seat or at a minimum is striving to be comfortable.
Right after that, it's about figuring out how the CS organization is supporting the business today, who and how we sell and what bits and pieces are either missing or haven't been thought of. I tend to do a lot of pattern recognition / matching when I first come in. The patterns and structures needed for CS are similar based on companies I've gravitated towards, but of course, the opportunity is often in the details and a mindset of "we did it this way at my last company, so we need to do it this way here" is rarely the best way to get things done.
Which is more challenging? Take over an existing CS organization or start one from scratch? Why?
Oh, that's a tough question. I'd say both have their unique challenges.
That said, I think it actually matters more where the founders are in the Customer Success journey more so than anything else. There is nothing better than a set of founders who "get" it and don't just think their product / service / company is the best thing since sliced bread and customers will just line up outside their virtual doors and will never ever leave.
Wake-up call: Most customers come for the product / service (and some even just for the company), yes, but they stay because of the people that take care of them once they are a customer. It takes a lot to win new customers, absolutely, but just because you won them over once does not ensure they will get value, or drive usage, or ultimately make them long-term committed partners.
Now, in an effort to not be a total politician by reframing the question and thus not answering it, I think building from scratch without any sort of founder-led idea of Customer Success is probably the hardest thing to do. If there are some vestiges of a CS motion already in place, however nascent it may be, it's usually a lot easier to build on and iterate from there.
In your opinion, what can companies do to prevent CS organizations from slipping to the point where intervention is required?
I think the answer to this question lies in what I mentioned in my previous point, but I'll expand on it a bit. CS organizations, from my experience, almost never "slip." Instead, they tend to run themselves ragged trying to adjust to the demands and whims of founders and / or senior execs who don't "get" it.
CS is there to take care of customers and to enable them to derive value from your products and services. They may also uncover new opportunities with customers and they certainly will be building deep relationships that often span across companies and products. They will develop what I call "raving lunatic customers" who often at least in part hinge their careers on those relationships. It's really quite remarkable.
Where things go off the reservation, often, is when senior leadership thinks that Customer Success is in the business of making customers happy (sorry, but nobody can "make" anyone happy... well, maybe someone handing out free ice cream, but that's short lived), fixing the product, coming up with new products, doing "BD" or "selling", or a combination of all of those things. Sure, CS weighs into a lot of those things, and they may even help spearhead some of those things, but they are not the fundamental purpose of CS.
People Data Labs
People Data Labs works with thousands of data science teams as their engineering-focused people data partner. These include enterprises like adidas, eBay, and Acxiom, as well as startups like Madison Logic, Zoho, and Workable. We are a deeply technical company, and are backed by two leading engineering venture capital firms - Founders Fund and 8VC.