Maturity Model and the six levels of the Customer Success Manager (CSM)
The maturity of the customer success function within the SaaS software industry is something I have observed over the last wee while.
I have seen the hiring boom and bust cycles for CSMs, the changing skill sets for CSMs at different phases of a company's maturity, and the varied range of perceptions about CSMs and the broader function of Customer Success.
These are generalized observations that can help organizations at different levels of maturity determine the mix of skills that a CSM may need depending on the product and market.
The comments on the Maturity model are focused more on SaaS products that are of a technical nature.
Maturity Model:
Level 1: Birth
Near the beginning, SaaS companies will have sales, Marketing, Engineering, Support, etc. The sales teams are working hard to convince clients that their solution is a good one and their company is viable. Presales are being done by anyone with a good technical understanding of the product e.g. developers. The clients for the software are happy to use cutting-edge technology and so they don’t expect everything to go smoothly. At this stage, Customer success doesn’t exist as a function.
Level 2: Crawl
The volume of clients purchasing cutting-edge SaaS products means that there isn't enough time for the small number of account managers to ensure the product sticks. The Account manager may be acting like an order taker in the sense that there is so much latent demand that they are unable to perform any of the broader functions within Account Management. At this level, a Customer Success function is created.
The Customer Success Manager (CSM) engages with a high number of clients, basically anyone that is shouting; with a focus on the accounts that have the potential to grow. The CSM will spend a lot of time delivering personalized technical support along with some relationship management, removing some of the burden from the Sales team and the centralized Technical Support teams. The CSM is not a chargeable resource and their focus is on helping clients to use the product and to understand technical client issues with the product. These observations can be fed back to Engineering and Product Management to enhance and develop the SaaS product’s roadmap.
At this level, most of the clients will have a small footprint so expanding this is a key requirement for the CSM, noting that most of the barriers to growth will be technical. - For folks that work in a more mature organization the CSM looks similar to a Technical Account Manager (TAM)
Level 3: Walk
The number of clients increases rapidly. All business functions within the SaaS company grow and you would expect resources to be distributed geographically with 1+ geographically dispersed centers. The support team becomes professionalized and able to manage complex and numerous support calls.
CSMs are not required to provide such in-depth personalized technical support to clients. CSMs bundle the learnings from previous maturity levels and are better able to provide guidance to clients around best practices. The CSM is a Hybrid between technical depth and understanding, consulting, and program management.
The SaaS organization may have developed additional SKUs. Usage and adoption remain a priority for CSMs but with an additional focus on using these new SKUs to deliver even more value. This is when you hear comments about the CSMs being part of the growth engine for the SaaS organization.
The CSMs work with larger clients that have the potential to grow quickly.
Level 4: Jog
Pre-IPO. A Professional Services team is created along with a Technical Account Management (TAM) function. A TAM sits within Professional Services and they are charged out to clients as a resource to support clients with all their technical issues. As the product is still new and technical skills are probably not readily available in the market clients need these deep skills to continue to grow their deployments and scale value.
The CSMs provide high-level advisory on aspects of the delivery function (DevOps, Agile, Backlog, Pipeline generation, etc) and also the structures (people, processes, systems) that influence the value the client gets from the solution. The CSM is a consultant, a coach, and a mentor to the team and the leaders in place that deliver the solution to the organization. We may see a Value engineering function being introduced and some of this capability being owned by the CSM team.
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The CSMs work with a limited number of clients to expand from the outside-in using relationships and deep client intimacy.
Level 5: Sprint
Post-IPO. The SaaS companies’ business partners have scaled to the point that they have enough skill to technically support clients in key markets and drive sales.
Clients have scaled even further and the need for TAM resources increases among the top tier of accounts, they see the TAM as a way of de-risking their investment in the solution.
CSMs are focused on the top tier of clients and are primarily focused on strategic initiatives such as value realization to enable the client to influence the C-level decision-makers. Often the C-level does not have a good view of the value of the solution and getting this message up the chain in a meaningful way helps both the client and the SaaS company. CSMs also focus heavily on delivery excellence, future roadmaps, and value realization.
The CSM role bakes in the tools, techniques, and methodologies of value engineering to accelerate strategic discussions to move large complex enterprise customers up the maturity path towards exponential value which corresponds to exponential consumption.
We would expect to hear clients talking about the SaaS vendor being a “Strategic partner”. We would also expect to start to see large ARR deals being signed in the major markets.
Level 6: Marathon
At this level, it can go a few ways.
It's not an either-or choice and a blended approach may well be taken.
In summary, the customer success manager role in a high-technology SaaS company requires a dynamic skill set. The skills needed vary over time depending upon the maturity of the organization.
Start-ups that are looking for CSMs will have a clear view of what they need the CSM to do today. Having an eye on the requirements for CSMs in the future can be useful so that there isn’t a cycle of hiring and firing as the needs change.
It also highlights the need to keep CSMs' skills up to date. This can come through standard online training or more bespoke training delivered by way of a mentor.
What is the maturity level of your CSMs?