Customer Success Professionals are taking a bigger role each year. What does this mean for the Account Management profession? Which one(s) do you need as part of your Go To Market strategy for 2019?

The emergence of the Customer Success Professional is an existential threat to account managers.  As you create your headcount plan for 2019, you’re starting to think of how to cover your accounts, and whether you need Account Managers, Customer Success Professionals, or both.


Let’s start with a brief discussion of the key things an account manager has traditionally done:


  • Manage Renewals – Proactively manage customer renewals, and ensure they continue to buy from you.


  • Up-Sell – Manage the opportunity management cycle for buying more of the same product(s).


  • Cross-Sell – Manage the opportunity management cycle for buying additional product(s).


  • Resolve Escalated Service Issues – When routine issues impact senior individuals, or have not been resolved in a timely manner, the Account Manager takes ownership for resolution, leverages internal resources to complete this.


  • Deliver Executive Business Reviews – While the cadence varies, it is a periodic review of what we have accomplished together, targeted at buyers.


  • Maintain Relationships – People buy from people, so periodic contact via various channels to maintain a human connection.


As several thought leaders (Gainsight, Totango, Sixteen Ventures) have also concluded, Customer Success Professionals can, and in most cases, should own all of the above.  One key difference with Customer Success is the intent.   These things are done for and with the customer in mind, from individual users, all the way to the C-Suite buyers.  We have all experienced the Account Manager who did these things to you.


You cannot simply “rebrand” your Account Managers as Customer Success Professionals, because there are additional capabilities needed to be successful:


  • Customer Onboarding – Orchestrate the customer onboarding experience. Ensure that users have everything they need to access the tool.


  • Customer Training – This can be in person or leveraging videos, etc, but making sure that users know how to use the solution.


  • Proactive Issue Resolution – The best service call is the one that never happens. Customer Success Professionals are proactively monitoring usage, risks, etc, and reaching out to deliver value.


  • Drive Utilization – This is the continuation of the onboarding and training. It can be new users that are added or ones that need a refresher.


  • Create Value– Utilization for its own sake is meaningless, it must be in the context of how the customer creates value. Documenting this in a customer relevant way is vital.


  • Communicate Value – Taking the value generated in the previous phase and showing that the expected result promised in the sales campaign is delivered.


Clearly, this is the case of a high touch model.   What you lose in efficiency with an account manager, you will gain in effectiveness.   Additionally, because CSMs generally have a less levered compensation plan, with a large customer satisfaction component, you more closely align their interests to Customer Outcomes and Experience rather than revenue growth.   


With everything the CSM is doing, is there room for an Account Manager?   That is a simple question, but difficult to answer.   To answer this correctly, you need to complete Account Segmentation.   This will identify your current revenue by customer as well as the revenue potential by customer (how much they can spend on your solutions).


Learn more about Account Segmentation by downloading SBI’s 2018 Q3 Research Report. Completing this analysis will identify the Customer Lifetime Value (CLTV).   In your highest  CLTV accounts, you can, and should, invest in a higher touch model.   This is where the Account Manager and Customer Success Professional will co-exist.   These accounts typically have more complex Buying Decision Teams.


The Account Manager will have to focus on the following:


  • Building New Relationships – more buyer focused, where there is not a natural interaction with the Customer Success Professional(s).  The value stories created by the Customer Success Professional must be translated and communicated to a diverse audience with varying motivations. 


  • Prospecting – This is a motion inside the account, to get you into additional buying centers. This can be accelerated via advocacy efforts, but for larger accounts, this motion is time consuming. 


  • Managing Price – If your pricing structure is complex and/or it is heavily customized, you will need an Account Manager to manage the customer facing and internal presentation and negotiation.


  • Negotiating Contracts – This is often related to complex price, but multi-national, multi business-unit customers that require customized contract terms will need someone experienced in managing this process.


The traditional Account Manager who walked the halls no longer has value.   The Account Managers who succeed in the future will excel at collaborating with their Customer Success Professionals to deliver on Customer Outcomes and Experience.


Let’s demonstrate an illustrative case.


Customer A – You have $500,000 in annual revenue, but your potential analysis indicates they could spend $2M per year with you.  However, this requires access to multiple buying centers.   This account is led by a Strategic Account Manager.   He or she completes the account plan, with how you will pursue the white space identified in your Account Segmentation. The Customer Success Manager here does not own the Cross-Sell or Up-Sell quota, but is incented on identifying opportunities and referring them to the Account Manager.   The additional complexity needs to be managed by the Account Manager.


Customer B -you have $100,000 in annual revenue, with potential for approximately $150,000.    In this account, you may have a Customer Success Manager who owns all aspects of the account.   There is one additional buying center for you to access, but this can be achieved with your standard pricing tiers, and is likely to be executed via a simple addendum to the Master Services Agreement, which your CSM can execute.


To deliver on this model, you must have clarity in who does what, and when.   Ultimately, you will build a Customer Success Playbook, which documents your processes and provides instructions to your team.   This all starts with a map of your Customer’s Journey, and then you assign responsibilities and accountabilities for each customer stage.


Download our Customer Success RACI Tool, which can help frame these discussions.   Like other species, it’s not the strongest of the species, but the most adaptable that survive. The Account Managers of the future will make this transition effectively.




Additional Resources


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