Customer Success Magazine
By Mikael Blaisdell

The question: “Where should the Customer Retention / Success Management team (by whatever name) be placed in a SaaS organization?” — is one of the top queries being asked all over the global software industry.  Should CSM be a part of Sales? Operations? Professional Services / Implementation / On-Boarding?  Does it report independently to the CEO?  Worldwide, examples of all of these approaches are easy to find.  To make matters even more interesting, it’s not uncommon to find a migratory path being followed by the team through the corporate structure over time as the role develops.Elements of CSM 900

The Customer Success Management Organization

CSM Org Puzzle pieces 4 450 wide 45KA corollary issue concerns the component functions of the team.  What other roles might be co-located with Success Management?  Why? Should Support be a part of the CSM group? How about Training?  Underlying all of this are far more serious challenges: Can organizational models developed under the traditional on-premised perpetual licensed business model truly fit the new realities of SaaS? When technological features & functions can be easily duplicated by competitors, what is the true product being sold?  What kind of company structure is required to produce and sustain it?

Strategic Drivers and Constraints

Whatever you want to call your “customer retention and expansion effort,” the mission/strategy charter needs to be clear-cut so that it can serve as a firm foundation for establishing and managing the process and organization of the team.  There are two key design drivers to be carefully considered: A) to ensure a seamless and consistent customer experience/relationship throughout the company, and B) maximum effectiveness of utilization of employee skill sets and knowledge.

As Support and contact-center professionals know very well, any organizational deployment that divides resources into separate queues or operating sub-groups automatically incurs a 10-20% inefficiency factor just from the separation.  Such a structure also contributes to burnout and employee turnover.  What’s even worse is that team boundaries make it much more difficult to build and sustain a common image and experience of the company for all customers.

My strong recommendation is that the retention team ought to own/include all customer-facing roles past the initial signing of the contract.  This does not mean, however, that there is no interaction with the team until that point; quite the contrary should be true.   The more a company can use the data and insight of the team and move the point of initial engagement earlier, the better.

The Reality of Customer Retention

The Vision of Customer Success Management

The emerging role of Customer Success Management is about an enlightened, scientifically engineered and professionally directed solution to the long-term strategic issues of customer portfolio development, retention and expansion.  Across the SaaS B2B sector, the choice is becoming clear.  You either go about managing your customer relationships strategically, or you effectively cede control over them to chance and/or your competitors.  The long-range vision of CSM is a strategic integration of technology, Marketing, Sales, Professional Services, Training and Support into a relationship product instead of the hodgepodge tactical methods of distributing software as a stand-alone tool.

The Customer Success Association Forum

The People of CSM is being discussed in The Customer Success Forum on LinkedIn.  Please join us there.


(This article was originally published in The HotLine Magazine. [ ]  It has been slightly revised since then.)

January 30, 2014