Where do you stand?: Five hot topics of debate in Customer Success

The Customer Success industry is constantly evolving and developing new strategies for driving customer-led growth. With the emergence of new technologies, market trends, and CS practices, the industry is abuzz with debate and discussion.

To explore some of the most controversial topics in CS today and hear what those on either side of the debate have to say, we asked four industry experts to weigh in.

This debate took place at ChurnZero’s annual conference, BIG RYG, and included panelists Stephanie Berner, global head of customer success at LinkedIn; Andrew Fink, head of customer success at 6 River Systems; Jeff Kushmerek, CEO at Infinite Renewals; Archana Shetty, head of customer services at Asana; as well as moderator Alli Tiscornia, CCO at ChurnZero.

From the most effective way to measure CS to the best approach for dividing up revenue responsibility, this debate will give you a lot to talk about and—who knows—it might just change perspective.

This transcript has been lightly edited for readability and concision.

1: Is NPS a Customer Success metric?

Stephanie Berner: My answer is unequivocally no—Net Promoter Score (NPS) should not be a CS metric. Here’s why. Using only NPS to measure a CS team is far too narrow, it’s easy to game (depending on who you survey and how you cut the data), and it lacks context.

So many CEOs and CROs are searching for a singular metric to measure performance because they’re used to managing sales teams. They want to know: “What’s your one number?” CS leaders know it’s far more complex than that.

Often, the C-suite thinks that CS is only about customer happiness. However, CS is not about customer happiness, it’s about customer value. Value is very hard to measure. NPS is not the answer. There are times when NPS is fantastic. I’m a huge fan, even though I don’t like it as the sole metric for CS.

In Gabby Wong’s presentation, “The new ‘C’ in CEO,” she shares all the places where her company measures NPS. It covers multiple respondent types, multiple moments in the customer journey, and multiple ways internal teams use this number. As a CEO, she can look across the business and the customer journey to understand how it all works together.

For example, if you receive an end-user NPS response or notice a pattern in end-user NPS feedback that says, “I hate this product,” and then from the same account, you get decision makers or contract signers saying, “I love this product,” that’s a problem.

In context, you can say what’s going on here? For a CS team, it’s an opportunity to recognize a need for additional end-user enablement. For a CEO, it’s an opportunity to think about how to tell a more holistic story.

NPS always does well when put in a context beyond its basic questioning of “How likely is it that you would recommend [Company] to a friend or colleague, and why?”

Jeff Kushmerek: However, there can be extraneous circumstances where you’re just glad you’re measuring something, especially for startups. If your board wants you to measure NPS because it’s what they use across their portfolio of companies, guess what, you’re measuring NPS. Sometimes, you get forced. You can use NPS as a baby step until you’re ready to move up to the big leagues.

Related resource: The crucial nuance behind seven top Customer Success metrics for SaaS companies

2: Should Customer Success own renewal and expansion?

Jeff Kushmerek: CS teams owning revenue should not be controversial for anyone. As a CS leader, renewal ownership gives you revenue which gives you acceptability in the boardroom and a leg to stand on. It doesn’t make you a cost center, which is the worst when finances are shaky which they are right now.

As a CSM, depending on the circumstances, you may have to give a salesperson an expansion opportunity. But for renewals, you work so hard to get customers to value. When sales owns the renewal, it’s like having that jerk who you hate show up and say, “Thanks for getting me all the way to the goal line. I’ll take it from here.” You’re doing that work; you might as well get comped on it.

CS teams that advocate for not owning revenue say it’s because it would interfere with their customer relationships. They don’t want to bring contractual stuff into the conversation. But guess what: Your salespeople sold a deal to customers. They made a financial transaction. You didn’t meet these people at the farmers market and hit it off because you like each other’s sneakers. As a CSM, you’re helping them get to where they need to be, and you know their business goals better than anyone. So, damn straight you should get the credit and the cash for that.

Archana Shetty: I agree that CS should own a number. Owning the number gives you power and helps you go to the CFO and say, “I need X number of resources because this is the amount of revenue my team owns.” However, it’s about finding a balance. Someone in the company needs to worry and think about the customer. The customer-first mentality needs to exist.

When your CS team owns the number, watch out for their language changing. If it’s all about “pipeline” and sales terms, then you need to start worrying. As a CS leader, I worry about the LTV. What’s the best thing for the customer and the company in the long run? If you forget that, then you’re creating another sales team—why even call it Customer Success?

Stephanie Berner: I’m going to take the middle ground. You have to be thoughtful about where you are as a business. What’s your sales motion? How many people do you have?

A CSM owning renewals is different from a CS organization (or CCO) owning renewals. I’m a giant fan of the latter. There are two times when a CSM owning renewals becomes problematic. The first is when your product is so complex that the relationship and the consultative motion have to be all about the program and the technology. In that scenario, it’s hard to find individuals who can do that and have a commercial conversation, especially in this environment. Talent can become a real bottleneck.

The second is when you distract CSMs from the renewal. For example, I was at a previous company where we thought we had churn down, and so we pivoted to comping our CSMs on CS-identified upsell. Everyone started looking at the dollars and focusing on these upsells. All of a sudden, these dive-and-catch renewals caught up with us because no one was paying attention to the ongoing engagement and health of the customer base. It can become a real distraction because, naturally, people gravitate toward the money. Get your incentive structure right to ensure you’re being thoughtful about how you engage customers during renewals and upsells.

Jeff Kushmerek: When it gets to the transactional aspects of DocuSign and procurement, you can have someone other than CS take on those elements. It removes some of that transactional feel.

Archana Shetty: Ownership also depends on the size of the renewal. Ideally, everything below a certain threshold needs to be automated. We have a renewal operations team that helps CSMs and AEs close renewals. But you don’t want to introduce too many folks because that becomes complicated.

Jeff Kushmerek: If you’re a series A or B company, you don’t have the luxury of having that infrastructure, so you have to make do with what you have, whether that’s two, five, or ten people.

Related resource: The SaaS debate: Who owns the renewal and upsell? Customer success vs. sales

3: Is the QBR dead?

Archana Shetty: Please don’t kill it is my humble request. During the sales cycle, you’re collecting information on the customer’s pain points, use cases, goals, and metrics. That process isn’t one and done. A customer’s business objectives change throughout their lifecycle, especially with today’s economic uncertainty. Their priorities can switch from one day to the next, so you want to make sure you’re still scheduling business reviews. Because that’s where you have conversations with customers about whether your partnership still makes sense and how you’re helping them reach and measure specific business objectives.

You don’t have to meet quarterly, but you should meet at least a couple of times a year to ensure you’re aligned and still a partner versus a vendor.

Jeff Kushmerek: When people write these articles that the QBR is dead, what they’re trying to say is good, which is stop asking people to come to these crappy meetings where you’re providing no value. You’ve seen tons of people going about it the wrong way. Essentially, it’s let’s go and vomit these statistics out to my peer relationship person so I can check that box and move on.

However, you can do so much more to provide value. It doesn’t need to be complicated. You can record a quick Loom video to share additional research you’ve discovered or feedback you’ve acquired about a topic you recently discussed with a customer. You can provide value in other ways besides holding a 45-minute death march through statistics.

Stephanie Berner: It doesn’t have to be done through QBRs. You could show value in an automated health check that says, take a look at this reporting and if it’s not what you’re expecting let’s have a conversation.

The most instructive thing you can do is sit in a QBR as a recipient from one of your company’s vendors. That will teach you a lot about what feels like a good use of time and what is terrible.

Related resource: Rethinking the quarterly business review (QBR)

4: Why is Customer Success underrepresented in the boardroom?

Andrew Fink: Whether you attend a board meeting depends on who you report to. From my experience, if you’re a small CS organization that reports directly to the CEO, you may get pulled in once a quarter. I was involved in the process. However, now that I report to the go-to-market lead, I’m not involved in the board meetings. You may not necessarily want to be if you’re in a large company, but it depends. The reality is that CS should be represented somewhere. If your boss isn’t representing your information in that boardroom, then you’re not doing your job.

Stephanie Berner: I had a conversation with a guy who has a VC firm, and I was asking him this question. He said more and more, especially in the current environment, investors and board members want to know who is going to be fueling your growth two to three years from now. We know that 80% of a company’s revenue comes from its existing customers as it grows. Board directors are going to be asking: what’s your retention? It’s not only about the top line.

Jeff Kushmerek: If you don’t own revenue, you’re not in the boardroom.

I’m also pleasantly surprised at the number of VCs that are forcing their portfolio companies to focus on this number right now. They care about if your product is actually good and can tell that by if it’s getting renewed or not. It’s become a big swing in the last three to four years.

Related resources: Six ways to get customer success more clout (and a seat at the table) and How Customer Success can use metrics to better engage investors and boards

5: If NRR is the only metric that matters, should you even pay attention or compensate your teams on GRR?

Stephanie Berner: Historically, NRR was the only thing that mattered because that’s what drives your multiple, and so that’s what investors always cared about. These days, there are more questions about gross retention: how much of your existing revenue are you retaining?

I don’t think NRR is the only metric that matters. We’re in the world of B2B relationships. It is way more complex than one number—I don’t care what number you pick.

If you make NRR the responsibility of all teams—for example, CS gets an NRR target, sales gets an NRR target—and then you give each an extra metric—for example, CS gets a value metric and sales gets an expansion number—then right in the middle, you get this nice overlap where everyone cares about revenue. It’s like a Venn diagram that shows a co-ownership of revenue, but each team is driving something that only they uniquely can do.

Related resource: Net revenue retention vs. gross revenue retention: Explained