AMA: Gainsight Senior Director, Customer Success, Michael Maday on Scaling a Customer Success Team

1. Customer Success Managers (CSMs) are grouped into segments based on either Product Type or Annual Recurring Revenue (ARR). 2. Each CSM reports to a CS Director responsible for leading their respective segment. 3. CS Directors report to the VP of Customer Success, who manages all CSMs. 4. The VP of CS reports to the Chief Customer Officer (CCO), who oversees all post-sales teams, including Renewal Managers. 5. The CCO, in turn, reports to the CEO of the company

In this scenario, I aim to pinpoint areas where the most significant impact can be made. If one product exhibits notably lower retention rates, focusing efforts there may be prudent. Alternatively, if a product contributes substantially to revenue, it warrants priority attention. Specializing team members to focus solely on one product can also streamline their efforts and enhance expertise.

Key initiatives for a nascent Customer Success team to establish include: 1. Implementation of a robust Health Score framework capable of forecasting both risks and opportunities for growth. 2. Implementation of a streamlined risk identification process enabling Customer Success Managers to promptly flag problematic accounts to leadership. 3. Development of a comprehensive Value Framework allowing CSMs to articulate to customers where value is being derived and identify areas for future enhancement. 4. Establishment of Success Plans enabling CSMs to set and monitor customer goals, ensuring progress is tracked effectively. 5. Implementation of an Effective Business Review (EBR) or Quarterly Business Review (QBR) process to facilitate the creation of tailored content for executive-level engagements. 6. Development of Renewal processes that provide CSMs with clear visibility into upcoming renewals, allowing them to align efforts with Sales partners and monitor progress seamlessly.

Understanding and quantifying the value customers receive is paramount for a new CSM function. Once identified, it facilitates the construction of a CS framework to expedite time to value recognition and provide tangible proof to the customer. Growth of this value becomes the cornerstone for aligning with stakeholders, conducting Executive Business Reviews, and other operational motions.

We conduct monthly CS All-Hands meetings for team updates. Quarterly, we extend this to include all teams under our Chief Customer Officer (CCO), along with company-wide All-Hands meetings. Additionally, we host Leader-level Quarterly Business Reviews (QBRs) where all teams are represented, allowing for deeper dives into metrics and trends.

When interviewing new Customer Success Managers, I prioritize strong communication skills and professionalism as fundamental requirements for the role. Additionally, I seek evidence of their proven track record in essential role-related skills. I also inquire about instances where they've demonstrated "Extreme Ownership" of accounts and situations, along with lessons learned from past missteps, whether internal or with customers.

To scale a Customer Success function effectively, it's crucial to demonstrate its financial impact and how additional headcount can amplify this effect. A simple method is to analyze renewal and expansion rates for accounts managed by Customer Success. By applying this financial model, you can determine the potential growth and retention value that an additional CSM could bring when engaging with currently uncovered accounts. This approach provides a clear rationale for expanding the team while showcasing the function's tangible contribution to the organization's bottom line.