In this session of Preflight Berlin’s Office Hours, Cohort Host, Srinivasan Shanker, spoke to Paul Henderson, Founder of Outcome Leaders, on driving Professional Services and Customer Success teams towards outcomes.
With nearly 35 years of work experience in global roles, Paul last worked as the APAC head at QAD, leading a team of 200 members across 89 countries serving 800+ enterprise customers. In the last five years, he designed and ran an outcome program for customers in the APAC region, a project that got him hooked on outcome-focused programs, and led to the founding of Outcome Leaders,
Outcome Leaders helps technology companies adopt an outcome approach to customer engagement. They facilitate outcome workshops for companies who want to adopt or improve an outcome program.
The session focused on:
Here are our top ten takeaways from the session.
A typical project begins with the customer
The engagement model that vendors use in this context has evolved as shown below:
Tech vendors showed customers that they could meet requirements by showing how their features matched their current requirements.
This approach leads to companies finding themselves in catch-up mode as they grappled with new problems.
Today, companies are focused on outcome generation to show and guide customers to reach their to-be stage. Companies such as Salesforce, Microsoft, SAP, Adobe, ServiceNow, and Mulesoft, currently have a focus on outcome generation in their projects.
There are two types of customer outcomes associated with any project:
A good way to look at product outcome versus success outcome is the drill bit analogy; customers buy a drill bit not to get a hole in the wall, but to have a picture on the wall.
In this case, the product outcome is a hole in the wall, but the outcome that matters to the customer, i.e., the success outcome is a picture on the wall.
Even if you have a stellar product that works well, it needs to be used to drive the outcomes that make the customer ‘feel’ successful – so they return to you the next time.
The foundational principle of the rule of six is that every customer project at its core consists of six decisions that customers make. You, as part of PS or CS, need to influence customers to take each of those decisions in your favor. For this, you need to
Based on research from conversations with 150+ global executives, the six decisions you need your customers to take are:
As a vendor, your engagement model has one purpose – to elicit these six decisions
The foundation of your engagement model is ensuring customers feel the right emotions at each stage – to drive them towards these decisions.
You need to take the six steps outlined below to create the emotions that will drive customers to make the desired decisions at each stage.
Here’s how this should shape your engagement model:
Customer Success acts in three ways (and as a result, levels) in the engagement model:
At the lowest level, automate as much as possible to make the process self-serve.
It’s important to note that studies show that NPS is a good predictor of retention, not expansion, and hence is best limited to usage at this level.
At the retention and adoption level, the strategic direction should be to ensure product-led adoption, say by using the product to identify users logging in, or identifying users engaging with the product, but not using advanced features, to nudge them to engage more meaningfully with the product.
At the highest level, focus on having measurable outcomes to ensure that customers feel successful.
The PS team has one task: create a reference out of the customer.
Today, a customer project no longer follows a customer-vendor approach. It has evolved into a partnership based on shared accountability. The below image highlights what this shift looks like at each stage of the project journey.
To summarize, any customer project needs to focus on two key things:
A big part of this is understanding the roles CS and PS can play in the cycle, as illustrated below.
The primary shift is in how the CS team is no longer focused on software or product purchases, but instead, on helping customers design business initiatives. This means that CS translates into a lead generation engine for existing customers.
The PS team is tasked with primarily doing whatever it takes to create a reference based on outcomes.
Here are three approaches you can take to get started with an outcome-driven engagement model
In this model, CS takes the lead to intervene in these stages, and can be involved in a BILD (Business Initiative Lead Development) approach that changes the focus from trying to develop product opportunities to developing business opportunities.
This approach – where PS is tasked with delivering measurable business outcomes and not just achieving go-live – has been observed to help PS teams feel a greater sense of purpose, and thereby boosted their performance.
Even during implementation, PS needs to look at quantifiable elements that draw from either revenue/cost/risk reduction.
Since it typically takes 3-4 months for customers to see results, there needs to be an agreement with the customer about who will drive the measurement of results.
This can be driven by a ‘Success Consultant’, a role for someone who understands systems, people, processes, partners, and supporting elements), who will come back to lead the measurement of the outcomes achieved.
The cost of this measurement needs to be built into your pricing.
If you want to learn more about Customer Onboarding, Implementation, and Professional Services in-depth, join the Preflight Community.