Saturday, March 15, 2014

SaaS Customer Success – Best Practices (Part 2)

“There are two rules for success:
1. Never tell everything that you know”     (Roger H. Lincoln)

Company Culture and Customer Success
In my previous post, I discussed perspectives that dealt with the technical and formal issues of improving customer success. It suffices to remember one fact – companies are more successful when their customers are more successful. In this article I will talk about a crucial facet of SaaS: company culture - that not only affects Customer Success, but many other aspects of running a successful SaaS operation.
(I have written about Culture in a number of articles in the past – some posts are pointed out)

Multiple Touch Points
In the on-premise business model, the touch points with the customer moved slowly from one part of the organization to another: Sales and Pre-sales were engaged with the customer at the beginning; then Professional Services engaged with the customer until implementation was complete. Following that stage, the ISV did not interact much with the customer. There may have been a yearly status call; sometimes the customer inquired about bugs or perhaps sent a request for features that was pushed into a waiting list. (The product may even have been sold through a VAR, leading to an even larger disconnect).

In the SaaS model, at any given moment there could be multiple touch points with the customer: The end users may be speaking with Support, while the customer IT is talking with the Ops group; the customer business manager is engaged in a call with Sales, while the CIO is speaking with the SaaS CEO about the latest outage, and Finance on both sides are figuring out last month’s bill. Some SaaS companies assign Technical Account Managers to large customers, but that would not alleviate the problem if end users continue calling Support, or IT happens to be talking with the network manager in the Ops group. In any case, TAMs are only assigned to a few, large enterprise customers and this will not work out if the company has hundreds or thousands of active customers.  
Mapping the touch points of the customer is therefore essential, and making sure that everyone who might have contact with the customer is using the CRM (or equivalent - I know, it is not cheap).

Need for Speed

Everything switches to Fast-Forward in SaaS. The sales cycles are shortened by at least an order of magnitude. The release cycles are shorter through agile methodologies and DevOps technologies; the impact of bugs is immediate (the new version is released at night and the following morning thousands of users interact with the software) and the response from the customers is almost instantaneous. Customers expect a fast turnaround and Information about success or failure travels as fast as the latest Tweet. Numerous customers may be added in a single day through self-service, or might churn at the end of the month.

Therefore, SaaS companies must shift into high gear. Especially if they come from the old, legacy, on-premise world, where the staff is used to much longer cycles in every aspect (I have been giving seminars at these old-world companies to emphasize that fact and push for cultural change). Quickness of response, of decision making, and pro-activity result from the elements discussed below: Transparency, Communications, and Openness.

I have written in the past about Transparency and it is still a valid article. I do not wish to recycle old material but suffice to say that customers will not only appreciate the openness and honesty as a virtue; they can also benefit from the knowledge while helping your company improve. When service is down, or slow, or erroneous, covering it up will not make your customers feel more confident. If you discuss the issues with them (s**t happens, you know,) you may work out together how to deal with service degradation in the future; that will help them become more successful.

When you promise a certain feature that you know will not be delivered on time or as expected, you may gain a few weeks of industrial peace, but that will clearly not make your customers more successful. If, instead, you openly share the status of your release, your customers would be better prepared. Working together, you may formulate an alternative solution that will allow the customer to succeed while reinforcing the ties between the companies.

Communications and Openness

The fact that almost anybody in the company might be in touch with someone on the customer’s end and that everything has sped up means that inter-department communications is crucial and internal transparency is a must. There is not time for ego games, or gaining an edge by holding important information close to one’s chest.
Transparency within the company is crucial (there usually is a correlation between external and internal transparency). If you promote a culture of openness and acceptance of mistakes, problems will be reported earlier and be dealt with the maximum available information, therefore reducing their negative impact. Both the company and its customers will benefit.
(Recommendations for periodic meetings can be found in my article on Inter Department Communications)

Service Level Agreements
The Support staff usually take the first hit when bad things happen, but every employee must understand the impact of service degradation. Make sure people empathize with what it is like not to be able to complete the task that the end user is evaluated on.
SLAs are usually regarded as a necessary evil, forced upon the SaaS provider by a standard expectation in the market, and is usually reduced to the minimal accepted level. (read more about SaaS SLAs).
But, imagine a company that takes it SLAs seriously, that thinks about the Service Levels that it provides its customers and that is proud of what it can offer to the end users and is open about it.
Imagine that someone within that company actually read the SLA and thinks about how to improve the Service Levels, not only the dead horse of the Availability section. Imagine what that might do to enhancing customer success!

A Point about Priorities
Some companies emphasize that the ‘Customer is Always right’ and keeping the customer satisfied is the top priority of the establishment. With other companies, making the shareholders happy is the major driving force.

The following observation is based on my subjective experience and understanding and has no scientific or statistic corroboration:
If you manage to make your Employees Proud, Dedicated and Happy, they will make your Customers Paying, Loyal and Happy, which will make your Shareholders Fat, Supportive and Happy.

This is why company culture is so crucial. Getting people excited and unified behind a common goal of excellence and customer success will result in Excellence and Customer Success.