Customer Success — the art of putting value & people first
14 Dec

I had the pleasure of interviewing Nir Kalish, Director of Customer Success at StrongDM, CS coacher, and CS advisor. Nir has 15+ years of experience building QA, Solution Engineering, and Customer Success groups from the ground up in early-stage startups. He is a husband, a father of two kids and has a passion for history and martial arts.

Thank you so much for joining us!

Can you tell us about your journey in Customer Success?

For most of my career, I worked in startups wearing many hats, including customer success and sales engineering hats. The significant shift occurred in 2011; after ten-plus years of building QA automation departments, I wanted to do something more business-oriented.

Back then, I worked in Cotendo. I spoke with the CEO, who not only gave his blessing but pushed me further to relocate to the US to manage the hybrid team of Sales Engineering and Customer Success.

Once I made the change, I fell in love with the worlds of Sales Engineering and Customer Success. Both worlds are similar from my point of view but have different timelines for building relationships and demonstrating value.

I also understood that I love to build those departments from scratch as it allows me to have multiple challenges that make my day-to-day more interesting and scalp the department with the values I believe in.

Since then, I have joined startups to build either customer success or sales engineering departments. My roles over the years led me to StrongDM, a hyper-growth startup that not only allows me to bring my experience to the table but also brings the ultimate challenge for a CS leader. The day-to-day challenge is building a scalable CS organization with a mix of high and zero touches.

What is it that excites you about this space?

There are two analogies that I believe can explain the excitement I have working in the CS world:

  1. Customer success is like a Chess game. You need to plan seven steps where you want to navigate your customers to build a deep partnership and to be able to penetrate the customer entirely. You want to guide your customers in how they use your service in their day-to-day life and see your service as a valuable and must-have solution. When you succeed in doing so, two things happen, the churn probability goes to almost zero, and you maximize the revenue without causing the other side to feel they are paying too much.
  2. Customer success is like marriage or a long-term relationship. You can keep the flame of love only by continuing to work on the relationship and not taking it for granted. In the customer success case, it means demonstrating the value of the product and CSM every time. When you look at your customer as a relationship partner, you start to care about the people on the other side, not their wallet.
    Like any relationship, over the years, you need to think more outside of the box about keeping the relationship honest, exciting, and valuable.

What are some of the biggest challenges you see CS teams face? And any advice on how to tackle them?

The current recession challenges all companies and CS organizations. CS leaders face a rare churn situation where they often don’t control it. You lose seats because your customers are letting users go. CFOs are taking an extra look at every expense, challenging renewals and new deals. In addition, many companies are reevaluating their services and tools. They consolidate tools and choose the ones that provide the most significant value for their needs.

Last is that CS teams may have had to lay off CSMs, and now they are facing the situation of doing more with fewer people, and the feeling can be unpleasant, scary, and stressful both for the CS leaders and the CSMs themselves.

There are several pieces of advice I can share from my experience as a vet of the 2001 and the 2008 crisis:

🞇 Focus on the value — CSMs must understand the value of your service. It’s a brainstorming that needs to be done between the CS, Product, Marketing, Sales, and the executive team. If our service is nice-to-have, it’s time for a cross-functional effort to understand the following:

  • Where can we bring value?
  • What should be our Ideal Customers Profile (ICP)?
  • Who are the executive sponsors we want to target?
  • What evidence can we put in front of them to demonstrate our value?

Talking about value is not good enough; we need to demonstrate it by working with the champions and understanding the ROI we bring. Then, we need to leverage our relationship with the champion to put the ROI results in front of the executive sponsor and buyer.

🞇 Focus on scalability — Everyone’s business will be weaker during the recession, but we can invest the efforts to build the CS organization’s scalability:

  • What do we need to manage customers with fewer CSMs?
  • What automation do we need in place to support hundreds of customers?
  • How can we manage customers’ health and pulse in scale?
  • What can we do to make the onboarding of customers faster and demonstrate our service value more quickly?
  • How can we work together with the marketing team, the support team, the sales team, and the Product team in a way we all help each other at scale?
  • Which processes and decks need improvement to take the CS to the next level?

🞇 Focus on people — When our customers have tough times, the last thing they want is a service provider trying to push their agenda. This is the time to be human. Give them the shoulder to lean on, and suggest leveraging your network to help them and their colleagues who lost their jobs. The business can wait a bit; if you do that, you will gain credibility and build humanistic relationships that can later pay off in stronger business relationships.

Focus on your team members, providing them confidence in the company and the changes that happen. To do so, you must also believe in those. Build your team members to feel comfortable taking risks, trying out things, and failing. Your team members can often have great ideas that can reduce churn and increase value, but they need to feel empowered to try out their ideas.
It does not mean not challenging them. Our job as leaders is to build our members to their next role, to be able to replace us at any given moment and to learn how to challenge themselves.

You have a background in building and scaling teams. Can you tell us more about your approach to doing so?

When I join a company to build a customer success organization, I invest my first 30 days in understanding how things are working today and learning the service well.

I interview the Product, Sales, and Marketing leaders and teams to understand our service value, ICP, roadmap, and the challenges they see. Then I speak with as many customers as possible to see if there is an alignment between what we see and what they see.

The calls with the customers also help me understand their pains with our service and identify risks and opportunities.

Then, my first focus will be customer onboarding. The onboarding period is the most critical time for a new customer and can impact the future penetration and success of the customer.

If the onboarding is too slow, we lose momentum to move our service across the customer’s teams; the customer frustration levels move higher, and we increase the probability of churn.

At this stage, I will implement the handoff between sales and CS, onboarding kickoff, the onboarding phases, how to demonstrate the customer’s reasons for buying, and the overall value of our service. I will focus on making onboarding as short and easy as possible for the customer without impacting the training and the foundations of growth. The onboarding retrospective will be the final step of the onboarding and the base for the development of the customer.

Then, I will focus on two essential areas in parallel:

🞇 The customer health and pulse — which parameters do we need to consider to measure customers’ health and pulse to predict potential risk and customer satisfaction?
At this point, I will build the churn, risk, and opportunities playbooks to help scale the CS group down the road.

🞇 The CSM profile — by now, we should better understand the product, the basic CS needs, and the customers’ challenges. We can now start defining what type of CSMs the department needs. We can describe the ideal CSM profile, the interview process, and the new CSM onboarding process. We will ask ourselves the following questions to help me build the profile:

  • What type of customer handling will we do? (High touch, low touch, no touch, hybrid, etc.)
  • What is the focus of the ICP? (SMB, Growth, Enterprise, hybrid, etc.)
  • What is the complexity of the product and the technical knowledge required to be a successful CSM?
  • What technical knowledge and skills do the CSMs need to have if it is a technical product?
  • What background and previous experience do they need to have to be successful?
  • What time zones do we operate by, and do I need the CSMs to be in specific time zones?
  • What is the company’s DNA — remote work, in-office, or hybrid?
    Personally, even before COVID, I managed people remotely.
    I can hire the best people globally when not being tight to one place. This allows me to control expenses smartly and build a better team that is diverse and unique and, as such, can be more innovative in CS activities.

The above steps, on average, will take between 4–9 months, depending on the company, customers’ situation, and the other departments’ maturity level. After that, I can start focusing on the growth activities such as QBRs, customer advisory boards (CAB), and more activities that create more stickiness to post-onboarding customers.

It might sound like I build everything myself, but it is a CS team effort to help develop the processes and the playbooks. When involving the team, we gain:

  • I can coach the team members to think strategically.
  • Mutual brainstorming creates better processes and playbooks than any idea from a single person (regardless of their title).
  • It is the first step to building a team that works together as a team, and the members are empowered to impact how the department will look.

What major trends do you expect to see in this space in the coming years when it comes to driving revenue — renewals & expansion — in the customer base?

The power of AI and NLP can bring massive value to the CS world. It can help drive revenue by giving the CSM and the manager the ability to look at all the customer data, identify risks better and help the CSM to be on top of things.

The amount of data per customer is getting more significant over time. There are multiple points to consider both for opportunities and risks. Static alerts are good up to a point; you need to fit it by the customer size, vertical and other parameters.

Also, usage tracking tells part of the story; you want to measure the engagement of the customers and the engagement’s tone, questions, and tasks that were asked during a call, email, or Slack channel.

It is not an easy task, but we need more intelligent tools that help give real insights and smart alerts (static and anomaly/pattern-based), measure engagement quality, and help the CSM identify risks and opportunities faster.
Those kinds of tools can positively impact identifying CSM weaknesses and help the manager build a better coaching plan for the team members.

Here is an example of my wishful thinking. The CSM gets an email from the tool telling her that on customer X, the health is being reduced because there is a recurring request, and in the last call, the tone of the speaker, who is the CTO, was a bit upset. In addition, there was an email sent from the customer three days ago to which we have yet to reply with an answer to the question.
Last, the risk is higher as in the past three weeks, more users were deleted, while in the news, the company announced closing round B of $50M.

The CSM manager gets statistics that over time one of the CSMs has difficulty following through emails and requests and suggested a coaching plan should be around time management and tasks management.

If you had to share, “words of wisdom,” with a CS leader, what would they be?

Look at your customers as partners and people, don’t look at them as goals and revenue targets.

When you look at them as partners, you care about them, and they will start to care about you.

That helps to build honest relationships and build more vital communications.

Part of it is always to bring value before asking for favors — demonstrate value in everything you do as a CSM, not only from the product point of view.

How can our readers follow you on social media or elsewhere?

People can follow me and reach out through my LinkedIn page.

This was very insightful. Thank you so much for joining us!

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