The failing practice of asking CSMs for cross-sell revenue

In 2022 we saw a massive focus on customer revenue expansion due to the stalled new business growth across the technology sector - It led to some serious missteps that are not new, but were amplified in the pressure of the moment. Customer Success as a discipline has morphed from its original intent to the point where I always need a role definition before I know what a person's actual job is. The original intent in SaaS was to provide a coach/advisor who ensures that the intended ROI of a service is realized. The core metrics were gross account and net dollar retention - Happy customers renew and expand as appropriate.

In 2022 we saw many 'coaching' CS teams suddenly encumbered with revenue expansion targets that require them to run full sales cycles. Let's compare and contrast two recent job postings:

CSM: Customer Success is a key role to ensure ACME's customers achieve value from our solutions. In this role, you will be a key player that supports our customers on their ACME journey. You are an advisor and facilitator to our customers, partnering not only with your team but with Sales & Services to help customers achieve maximum value from ACME.

Account Manager: The Account Manager will play a pivotal role in managing our strategic partnerships with key accounts. This individual will be responsible for understanding the client's business footprint, developing a robust pipeline of opportunities, and positioning ACME as a thought leader and strategic partner.

I highlighted the crucial differences and while it seems obvious in writing, it is worth considering the profile of your CSMs before assuming that they can perform the commercial aspects of the Account Manager role. If we simply use the 'D&I' from the DISC framework it becomes very apparent where the issues lie:

An obvious 'tell' that this won't work

If you built a Customer Success organization by hiring for coaches and advisors, then the profile will typically draw people from customer support, professional services or your buyer persona - None of these roles typically make a ready transition to sales (although there are certainly exceptions in the minority). When I hear that an organization is taking an established CS org and allocating cross-sell quotas, I always cringe - It is a recipe for disappointment.

A great CSM is expert in the domain, project management, change management and influence without authority - They are not typically trained in sales process, qualification, competitive strategy etc. Importantly, most are not interested in the latter.

Options for getting that revenue

I have seen the following work well depending on context:

Large accounts with land/expand motion:

Option 1 - AE to hold: Let new business AEs hold the accounts for as long as they want, but limit their territory to a # of accounts. IE If my patch is 50 accounts and I choose to hold 10, that means I only get 40 new ones. The AE is focused on maximizing revenue, so they won't be keeping accounts that they don't think they can get meaningful expansion. If they let an account go, then it is their judgment that there is no revenue to be had.

This is a self correcting model because any new rep can grab from the existing customer pool as well if they see an opportunity.

Option 2 - Account managers + AEs: In this option many orgs will allow the AE to hold the account if there is obvious expansion within 12 months (others pass it straight over). An Account Manager focuses on building executive relationships and commercial concerns, whereas the CSM focuses on maximizing ROI for the customer.

Smaller accounts with expansion opportunity - Auto + PLG: In this situation companies with horizontal solutions like Slack can simply auto-expand licenses, or have the CSM simply point out usage thresholds being hit, rather than proactively seeking new opportunities. This is very much in the 'demand capture' vs 'demand creation' bucket.

The call to action

Recognize the humans are not fungible - You have built an organization with people of a certain profile and we can't change competencies and behaviors by simply rewriting a job description. When considering how to capture additional revenue from your customer base, I encourage you to look at your specific context and determine what is fit for purpose.