Most CSMs should not own upsells and expansion

Introduction

?As someone in the #customersuccess (CS) industry for many years, I have noticed an interesting trend recently in the CS community. There is a growing consensus that CSMs should own more commercial responsibilities like upselling and expansions, not to be perceived as a cost center. While this approach seems to be gaining traction, I believe it is not a good idea for most organizations or CS leaders to jump on the bandwagon as much as the perception of CS as a cost center needs to be changed. In my opinion, thrusting the CSMs into a commercial role of upsell and expansion to change this "perception problem" is a flawed approach and may even be detrimental to the overall success of a company and the CSM in the short run.?

Why CSM's Should Not Own Commercial Responsibilities.?

Let me start by addressing the common argument that CSMs are uniquely positioned to upsell and expand because they deeply understand the customer's needs and pain points. While this may be true, it does not necessarily mean they have the commercial skills, know-how or the confidence to act commercially. Because, acting commercially is not usually a core aspect of their job/day to day activities. You have to agree with me that to become good at anything, your have to practice that skill regularly. A CSM may not have several/recurring upsell/expansion opportunities withing their portfolio. So how could a CSM with few opportunities to flex this much be really good at it. Upselling and expansion require a different skill set than customer success, and assuming that all CSMs can handle these tasks effectively is misguided. Failed attempts at upselling or expansion due to lack of this skilset can ultimately lead to lost revenue. Something a SaaS organisation cannot afford in the current economic situation.

A CSMs primary role is to act as trusted advisors to customers, helping them to achieve their goals and overcome challenges, which resutls in retention and long-term success. And as a result of high ROI/value and great service drives customer satisfaction. Furthermore, by placing the responsibility of upselling and expansion on CSMs, we are setting them up for failure. Most CSMs are already overwhelmed with their existing obligations, which include onboarding, adoption, retention, and in some cases customer support and other adhoc tasks. Let's be honest; CS teams are already one the most overworked teams in a SasS organisation.Adding commercial responsibilities to their plate may lead to a burnout, which could ultimately lead to high turnover rates. CSMs may also become too focused on commercial objectives, especially if linked to an incentive, leading to a decrease in the quality of their customer-facing (value-oriented) work.

Few other variable to also consider. What is the maturity level of the CS team and the company. Are both in the early/formative stages? Where the CS team is more of a generalist, "post-sales support" team. In this stage, for most companies breaking even and turing a profit is the biggest goal. Its then best that the sales team focuses on expansion and/or upsell, and CS focuses on ROI generation for the customers that drives retention. This distinction in roles will probably enable a rapid company. Are both the CS team and the company in a more mature stage? If the CS team has the skillset, the data, the enablement resources in place, then there is a case for CS to own upsell and expansion, with a caveat, ones that are not complex to execute. I would argue (and i have no data for this at hand) most CS organizations fall between the novice to kind of semi-mature spectrum.?

How the initial sales contract was setup and the product itself also plays a factor in this expansion/upsell process. Does and expansion/upsell mean a whole new process "sales" cycle needs to be initiated at the customer side, if there a framework contract where additional seats can be added, can the customer add more seats or change tiers themselves. If all of this is going to be a tedious process, CSM's can spend hours/days navigating through the complexities of making the expansion/upsell happen. All while their CS work suffers.?

How might customers perceive CSMs driving upsell and expansion.

Another argument favoring #csms owning commercial responsibilities is that it improves customer relationships. The idea is that customers will feel more comfortable speaking to someone they already have a relationship with about additional services or products. However, this assumption ignores that customers value transparency and honesty. If a CSM feels pressured to upsell or expand at the expense of the customer's best interests, it can damage the trust and rapport they have worked hard to establish.?

Customers may view CSMs as their advocate and confidant and may not want to feel pressured or obligated to buy additional products or services. Customers may also prefer a dedicated commercial contact who can help them navigate the complexities of pricing, packaging, and contracts.

But upsells and expansion needs to happen. Perhaps this might be a better approach.

Instead of just dropping commercial responsibilities onto CSMs. The commercial team, comprising of Sales,CS and Marketing team, should work together closely to identify upsell and expansion opportunities. Sales and Marketing teams can then take the lead on pursuing these opportunities, with CSMs providing support and guidance as needed. This approach ensures that commercial responsibilities are handled by the team with the appropriate skills and expertise while also ensuring that the customer success remains the top priority.

Create an enabling environment for the CS team to learn and sharpen these competencies. Have the CSMs sit in/join the meetings where sales contracts are drafted and/or negotiated with the customers. Give CSM's frameworks and parameters within which they are independently manage expansion/upsells. Create a collaborative environment where the CSMs can consult the Sales team for needed advice. Train the CS team on a sales methodology like SPIN/MEDDIC and some objection handling skills, which CSM's can use to improve their CS-oriented work.?

Conclusion

In conclusion, while it may seem like a good idea to assign commercial responsibilities to CSMs, most CSMs are not trained or experienced in commercial roles, have different objectives than commercial teams, and may not have the bandwidth to take on additional responsibilities. Instead, we should first focus on building a solid commercial team that can work collaboratively with customer success to achieve the best possible outcomes for customers and the organization. As a part of maturing the CS team, CSMs can gradually start taking on more commercial responsibilities based on a structured training program and the support of the sales team where needed.However, gettings CSMs to take commercial responsibility should not be a one-size fits all approach. Several variables must be considered before thrusting CSMs into commercial roles. Once trained, CSMs use "sales" to become a wellroudned professional.?