Jeff Rosset explains how to align customer success teams with business outcomes using the right metrics. Health scores, activity levels, and product utilization drive net revenue retention. Compensating CSMs based on these KPIs instead of arbitrary targets improves performance and prevents conflicts between account managers and customer success teams.
I don't know if any of you have felt this, but I think customer support, customer success, customer service, like the buzz topic for the past 10 years, like it's such an ironic thing, silver lining of the market right now of like, if the business didn't find value in customer success eight, seven years ago, they sure as hell better right now. Right? And I say that to say like you can go and sell a bunch of deals right now, but it's not at the same clip. And at the end of the day, if you can retain your baseline and grow from your existing baseline, like you're in a pretty damn good, good shape. And so I say that and I smirk as I say that because the idea of not having your most strategic team aligned to your customer, not tied to certain metrics, is just like a total miss in my opinion. Well, we teed this up as the metric. What metrics are driving the business? How do you do the right things to equate to those results? And the very first thing I would reflect on is who is supporting the customer and, and do they have competing priorities like conflicting KPIs or do they marry in those KPIs? And Sydney, you brought that up in terms of like AM versus CSM in your example of like where what's the lane and the better and smarter ally on this meeting, Ali Haynes, who is our director of cs, I'm going to steal the method she's brought in for us. But this idea that you actually pay on certain KPIs, so I think there's such a blurred line of what's a KPI versus what's a target. And we're trying our best to not confuse those two. And so my recommendation would be how do you think about the KPIs that go into what good is. So for us we're moving to a target of net revenue retention within that revenue retention. If I were to look at our best CSMs, what are the activities I need them to do in order to have the best retention? Net revenue retention rather, and that might be things such as health scores, a certain activity metrics, product utilization. So that would be my biggest recommendation. And aha moment I had thanks to Allie, who really took that, took that lead to say what are the KPIs we need to watch to monitor what is good and you can literally performance manage off of that. If they do those things correctly, then the ultimate goal that in our case is net revenue right now ideally I'd like to move to gross revenue retention one day, but I'd really separate those two. And it's an interesting concept of paying them off of those KPIs. So just kind of talking that through, I think, is a good exercise.
