80% of CSM activities don't impact a customer’s decision to renew.
“How does he know that?” you’re asking.
Because Pareto’s principle exists everywhere in nature. And in business.
We can improve any outcome by focusing on the 20% that truly matters.
Want to reduce support case volume? Solve 20% of product issues that cause 80% of support cases.
Improve revenue retention? Invest in 20% of customers that drive 80% of revenue.
Improve sales? Double down on 20% of marketing campaigns that produce 80% of pipeline.
People leaders should be keenly aware of this principle.
Especially customer success leaders whose teams are often saddled with diverse customer responsibilities.
From onboarding and training customers to renewing them. And everything in between.
In addition to Pareto’s principle, the cold, hard reality is that training and support don’t drive retention or expansion. See proof of this in both Matt Dixon’s and Greg Daines's data-driven research on customer retention.
So, do we even need to support and train customers?
Well, yes, of course, we do.
But the impact a customer success manager can have on retaining and expanding customers is limited when their time is spent on these activities. And it’s not differentiated from other customer-facing roles.
We should support and train customers. But we should do it in scalable ways. Not one-by-one using our CSM capacity (more on this in last week’s post).
The most important thing a CSM can do to improve retention and create expansion opportunities is measure, show, and discuss results with customers.
Results = business outcomes.
As a leader CS leader, it’s worth your time to analyze your team's work. A time and motion study.
What could you shed to create more focus on measuring, showing, and discussing results with customers?
Start with a clean slate. Add back only vital activities.
Your CSM team may not need to be as big as it is today. And that would be okay because you'll still need other specialized roles to develop content, deliver enablement webinars, manage customer community, and handle support cases.
In his book Essentialism, Greg McKeown encourages us to relentlessly pursue “less but better” activities:
There are far more activities and opportunities in the world than we have time and resources to invest in. And although many of them may be good, or even very good, the fact is that most are trivial and few are vital. The way of the Essentialist involves learning to tell the difference—learning to filter through all those options and selecting only those that are truly essential.
- Greg McKeown, Essentialism
Warren Buffett made 90% of his wealth from ten vital investments.
Surely the essentialist approach could work for you and I.
What are the trivial many activities that undermine your team’s ability to execute the vital few?
I'm trying something new this week – I'll send a second brief email mid-week with my Weekly Favorites (what I'm reading, listening to, and watching). Let me know what you think and if two shorter emails from me each week are too much.
Thanks for reading 👊