@joshuajforman

The Developmental Stages of the StartUp ~ Customer

Relationship

Joshua Forman

@joshuajforman

Agenda

• Thank You’s• About Me• Purpose of Presentation• Developmental Stages• Customer Success Evolution• Early States of StartUp ~ Customer Relationship• From Simple to Complex• Developmental Lines of StartUp ~ Customer

Relationship• Relative Maturity Rates

@joshuajforman

DSW Organizers

• Erik Mitisek• Tami Door• Ben Deda• Countless Others

@joshuajforman

Title Sponsors

@joshuajforman

Business Track Sponsor

@joshuajforman

Partner Sponsors

@joshuajforman

Member Sponsors

@joshuajforman

Thank You Host

@joshuajforman

Community

www.pledge1percent.org

@joshuajforman

About Me

20 yearsIn technology

8 yearsCustomer Success

Executive

7 yearsIn StartUps

Consultant

Business Technology Consumer

Technology Product

Systems Integrator

Held Roles As: Experience Includes:

Depth of Experience

@joshuajforman

About Me

Built Marketed Sold ImplementedBought Adopted

Working knowledge of how technology products are:

Breadth of Experience

@joshuajforman

Purpose of Presentation

You are better able to make relationships with your customers and

Assess

Plan

Anticipate

How you make those relationships

@joshuajforman

Purpose of the Presentation

• Factors influencing your territory:– Your target customer• B2B / B2C• Customer Demographics

– Complexity of Product • Self-service functionality?

– Pricing Model

@joshuajforman

Growing companies and customer relationships

is a mix of science and art

Developmental Stages

@joshuajforman

For any stage, there are developmental tasks you must master before moving to the next stage

Company Development

How you engage with customers today

How you prepare to engage tomorrow

Stage A Stage B

Developmental Stages

@joshuajforman

Customer Success Evolution

One-TimeTransactional

RecurringLifetime Value

Then NowRevenue Approach

@joshuajforman

Customer Success Evolution

Graph From: http://www.forentrepreneurs.com/why-churn-is-critical-in-saas/

Impact of Churn

@joshuajforman

UpSell to Grow Faster

Graph From: http://www.forentrepreneurs.com/2013-saas-survey/

Customer Success EvolutionUpSell Opportunity

@joshuajforman

Customer Success Evolution

• Goal– Continually Increasing Customer Lifetime Value

• Renewals: Reduce Churn• Increase Upsell

– Create Value for Your Customers

• Strategy– Master the developmental tasks relevant to your

stage– Plan for future stages

@joshuajforman

Company’s Early Stages

Product / Solution

Fit

Product / Market

FitScale

Maurya’sRunning Lean

Stages

@joshuajforman

Company’s Early Stages

Product / Solution

Fit

Product / Market

FitScale

Founders

Founders start

delegating to Others

Maurya’sRunning LeanStages

Who is Responsible forCustomer Relationship

Founders start

delegating responsibility to delegate

@joshuajformanGraph From: http://en.wikipedia.org/wiki/Technology_adoption_lifecycle

Company’s Early Stages

As defined originally by Everett Rogers in “Diffusion of Innovations”, 1961Made popular by Geoffrey Moore in Crossing the Chasm, 1991

Technology Adoption Lifecycle

@joshuajforman

Company’s Early Stages

Product / Solution

Fit

Product / Market

FitScale

Founders

Maurya’sRunning LeanStages

Innovators Innovators Early Adopters

Customer Psychographic

Organization Developing from Simple to Complex

Who is Responsible forCustomer Relationship

Founders start

delegating to Others

Founders have

delegated responsibility to delegate

@joshuajforman

From Simple to Complex

Pictures From: http://www.quia.com/files/quia/users/lmcgee/AP_Bio_Animals/Chpt_32_Animal_Diversity/AnimalEmbryoDevel_L.gif & http://blog.lib.umn.edu/chamb169/myblog/2011/11/fetal-development-barriers.html

@joshuajforman

From Simple to Complex

Pictures From: http://www.quia.com/files/quia/users/lmcgee/AP_Bio_Animals/Chpt_32_Animal_Diversity/AnimalEmbryoDevel_L.gif

DifferentiationMultiply

Differentiation

@joshuajforman

As Company Develops, Differentiation is a major developmental task

Founders

Customer Success

Marketing

Implementation

Support

Account Management

Lead Gen

Branding

CreativeEtc..

From Simple to Complex

@joshuajforman

Developmental Lines

• Developmental lines of activities in your customer relationships:

Those that provide value to the Customer:– On-boarding– Technical Support– Continuous Value

Creation

Those that provide value to the Company:– Feedback– Referral Customers– Market Advocates

@joshuajforman

Developmental LinesCapability Maturity Model (CMM)

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

New process in initial stage

Process is repeatable, some learning hastaken place, and some documentation

Process is defined as “the way we do it” and documented

Measurements are in place, and reviewed regularly, leading to ability to manage process

Process is being continually improved

Proc

ess

Mat

urity

@joshuajforman

Developmental Line:

Deliver Initial Product Value

Assess how to grow customers

use of the product

On Boarding / Professional Services

Self Service Functionality /

Productized Services

Are your services a product or a feature?

InitialRepeatable

Defined

Measure & ManageOptimizing

Develop Self Service, Template Implementation Plans, Productizing ServicesProcesses

Documented Processes

@joshuajforman

Start with initial on-boarding process.

Eventually find repeatable process that works

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

On Boarding / Professional Services

@joshuajforman

More Complex Product:

– Develop project templates

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

On Boarding / Professional Services

Self Service On-boarding:

– Develop self-service wizards

@joshuajforman

More Complex Product:

– Measure project completion time– Measure CSAT

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

On Boarding / Professional Services

Self Service On-boarding:

– Measure effectiveness of process

*You can’t just measure, have to use the metrics to manage the process

@joshuajforman

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

LearningMetricsInternal FeedbackExternal Feedback

ContinuousImprovement

Improved ProcessesNew MetricsBetter Management

On Boarding / Professional Services

*Assess how to grow customers use of the product

@joshuajforman

Developmental Line:

Phone & Email

TicketSystem

WebPortal

Knowledge Base

Customer Communities

Technical Support

ZenDesk, FreshDesk, UserVoice

NOT Remedy, ServiceNow

InitialRepeatable

DefinedMeasure & Manage

Optimizing

Tools

Social

Heard, Understood, SatisfiedProcesses

@joshuajforman

CustomerHeard

CustomerUnderstood

CustomerSatisfied

Process Step Key Factor

Quick Response

Customer knows you understand them, the

context, & the problem

Customer satisfaction with you.

Developmental Line:Technical Support

Heard, Understood, Satisfied

@joshuajforman

CustomerHeard

CustomerUnderstood

CustomerSatisfied

Process Step Key Factor

Quick Response

Customer knows you understand them, the

context, & the problem

Developmental Line:Technical Support

Heard, Understood, Satisfied

Maybe show them a

different way to look at it

Customer satisfaction with you.

@joshuajforman

CustomerHeard

CustomerUnderstood

CustomerSatisfied

Process Step Key Factor

Quick Response

Customer knows you understand them, the

context, & the problem

Developmental Line:Technical Support

Heard, Understood, Satisfied

You may not have even solved the problem

Maybe show them a

different way to look at it

Customer satisfaction with you.

@joshuajforman

Having as needed one-on-one conversations

Customers emailing individuals or email alias

Email conversations not centrally routed or tracked

May have process to be able to repeat with multiple customers

Developmental Line:Technical Support

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

@joshuajforman

Implement a ticket system to easily move to Defined:

– Requires you to define your workflow of how to respond to customer questions / issues

– Defines your portal experience

– Defines your knowledge base

– Can also define how you interact socially

Developmental Line:Technical Support

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

@joshuajforman

Utilize canned reports (and build your own) to measure and manage performance

Developmental Line:Technical Support

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

*You can’t just run the reports, you have to manage your processes with them

@joshuajforman

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

Technical Support

LearningMetricsInternal FeedbackExternal Feedback

ContinuousImprovement

Improved ProcessesNew MetricsBetter ManageabilityHappier Employees

@joshuajforman

Developmental Line:

1-on-1

UpSell: Drive

Adoption & Expansion

Continuous Value Creation

Differentiate Customer Processes:

- No Touch- Low Touch- High Touch

Customer Health:Monitoring &

Measuring

Totango, BlueNose, Preact

Initial

Repeatable

Defined

Measure & ManageOptimizing

Tools

Stakeholder Capability Matrix, Proactive MonitoringProcesses

Segment Customers

@joshuajforman

Developmental Line:Continuous Value Creation

UpSell

• Two ways to drive UpSells:

– Help new customer end users adopt existing products and features

– Expand product and feature use by current or new end users

@joshuajforman

Developmental Line:Continuous Value Creation

Adoption & Expansion

@joshuajforman

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

Continuous Value Creation

“Regular” customer check-ins that are adhoc conversations. No repeatable process on what to ask or how to connect.

@joshuajforman

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement Create repeatable processes for

different customer segments and touch frequency

Use customer success tools to define when interactions are needed- Customers in danger of cancellation- Customers with upsell opportunity

Continuous Value Creation

@joshuajforman

Developmental Line:

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

Utilize canned reports (and build your own) to measure and manage customer accounts

*Know what customers are doing, not just what they are saying they are doing

Continuous Value Creation

@joshuajforman

Developmental Line

Initial / Adhoc

Repeatable

Defined

Measured & Managed

Optimizing / Continuous Improvement

Continuous Value Creation

LearningMetricsInternal FeedbackExternal Feedback

ContinuousImprovement

Improved ProcessesNew MetricsBetter Forecasting

@joshuajforman

Marketing Sales Customer Success

New Customer Leads / Oppty’s

Responsible Consulted Informed

Close New Customers Informed Responsible Consulted

Existing Customer – Renewal

Informed Consulted Responsible

Existing Customer – New Oppty Identification

Informed Consulted Responsible

Existing Customer – New Oppty Close

Informed Responsible Consulted

Customer Revenue Responsibility Matrix

Developmental Line:

@joshuajforman

Relative Maturity Rates

Initial

Repeatable

Defined

Managed &Measured

Optimized

On Boarding

Continuous Value Creation

Technical Support

@joshuajforman

In Closing

And in the end,the value you createis equal to the valueyou make

@joshuajforman

Thank You

josh@forman-consulting.com @joshuajforman

www.linkedin.com/in/joshuaformanBlog: www.forman-consulting.com

@joshuajforman

References

• http://en.wikipedia.org/wiki/Diffusion_of_innovations• http://www.insightsquared.com/2014/05/4-tips-to-perfect-th

e-art-of-the-upsell/

• http://www.forentrepreneurs.com/2013-saas-survey/• Crossing The Chasm, Geoffrey Moore, 1999• Running Lean, Ash Maurya• Modus Law• Foundry Group• Service Excellence• Managing the Software Process, 1989 by Watts Humphrey• Individual graphics references on specific slide