WEBVTT
00:00:10.800 --> 00:00:14.070
Welcome back to the Customer Success Playbook podcast.
00:00:14.250 --> 00:00:21.570
I'm Kevin Medsker Roman, unfortunately is unable to join us this week, but we are here again with John Huber.
00:00:21.660 --> 00:00:27.239
It's Wednesday, which means it's time for one big question, but before we get into it, we're gonna.
00:00:27.519 --> 00:00:29.469
Loosen up with a few icebreakers.
00:00:29.620 --> 00:00:39.369
John, what's one song that always kind of fires you up before, like a big presentation or, you know, going into, to really close on something?
00:00:39.850 --> 00:00:40.960
It's a great question.
00:00:40.960 --> 00:00:42.429
I'm a big music fan.
00:00:42.969 --> 00:00:55.450
I say my go-to is a song called Disco by Widespread Panic, which is, uh, it's an instrumental song, just puts a smile on my face, very upbeat, uh, and kind of gets you in that right mindset.
00:00:56.399 --> 00:00:57.539
Widespread panic.
00:00:58.200 --> 00:00:59.844
They're, uh, yeah, you're an Atlanta guy.
00:01:00.155 --> 00:01:01.140
That, uh, what's that?
00:01:01.950 --> 00:01:03.179
I said, you're an Atlanta guy.
00:01:03.179 --> 00:01:04.920
They're from, uh, from your area.
00:01:05.010 --> 00:01:05.819
That's what I was gonna say.
00:01:05.819 --> 00:01:07.079
They're, they're big down here.
00:01:07.590 --> 00:01:12.209
If you weren't in customer success, what career would you pursue for fun?
00:01:12.209 --> 00:01:12.239
I.
00:01:12.659 --> 00:01:13.530
It's a great question.
00:01:13.530 --> 00:01:13.890
Fun
00:01:13.890 --> 00:01:16.439
being the optic, uh, optimal word.
00:01:16.469 --> 00:01:18.780
Uh, would love to be a professional golfer.
00:01:18.780 --> 00:01:30.840
My golf game is nowhere near, uh, suited to be a professional golfer, but man, I think it would be a ton of fun, uh, you know, to have that, uh, that time and uh, that passion.
00:01:30.840 --> 00:01:31.170
So,
00:01:31.829 --> 00:01:36.840
I don't know, I get so frustrated every time I get out on the course, I don't.
00:01:40.995 --> 00:01:42.885
It does seem like quite the life.
00:01:43.515 --> 00:01:47.745
What's your favorite thing to either cook or eat and, and, and Are you a cook or,
00:01:47.805 --> 00:01:48.495
I do.
00:01:48.555 --> 00:01:50.025
I do love to grill.
00:01:50.084 --> 00:01:51.974
You know, I think my wife and I both cook.
00:01:52.424 --> 00:01:54.165
Uh, I've got three girls at home.
00:01:54.165 --> 00:01:58.424
I did get a new grill last summer and it came with a flat top insert.
00:01:58.875 --> 00:02:02.775
I found myself just loving to cook on the flat top fajitas.
00:02:03.004 --> 00:02:03.094
Right.
00:02:03.424 --> 00:02:09.125
You know, chicken, veggies, smash burgers, um, you know, I didn't think I would use it at all.
00:02:09.125 --> 00:02:12.905
And I, I mean, we use it probably three or four nights a week.
00:02:12.905 --> 00:02:14.074
I absolutely love it.
00:02:14.794 --> 00:02:16.685
I got my Blackstone.
00:02:17.564 --> 00:02:19.935
Back before right around COVID.
00:02:20.150 --> 00:02:23.835
I I don't know if it was 2020 or whether it was 2019 that I got it.
00:02:23.835 --> 00:02:29.985
I know I was using it a ton during COVID, but, uh, I still still use it a ton to this day.
00:02:29.985 --> 00:02:34.544
I actually, I probably need to replace it at this point, but, uh, it's fantastic.
00:02:34.634 --> 00:02:35.985
Can do just about anything.
00:02:36.780 --> 00:02:37.289
You can,
00:02:37.289 --> 00:02:43.680
I haven't done breakfast yet, but I see a lot of people doing breakfast, so that's, that's my next, uh, my next challenge.
00:02:43.919 --> 00:02:45.120
Yeah, breakfast is good.
00:02:45.180 --> 00:02:46.590
I guess we should get into it.
00:02:46.590 --> 00:02:48.900
It's one Wednesday is one big question.
00:02:49.379 --> 00:02:51.599
Who should own expansion and upsell?
00:02:51.599 --> 00:02:54.990
Should it be in CS or should it be in sales Hybrid?
00:02:54.990 --> 00:02:55.710
What's your thought?
00:02:56.430 --> 00:02:57.960
Yeah, that's a great debate.
00:02:58.020 --> 00:03:00.330
And I, I would tell you it depends.
00:03:00.419 --> 00:03:04.080
Um, and I'll share a couple of examples because I've lived in both worlds.
00:03:04.590 --> 00:03:18.240
I've worked at a couple of companies where 12 months after the original deal was signed, the CSM would own, you know, the expansion, the upsell opportunities, the renewal opportunities.
00:03:18.300 --> 00:03:25.139
Like my most recent company as an example, we made a, a pretty important decision early on as we were building out the teams.
00:03:25.740 --> 00:03:32.009
To have an account executive partner with A CSM and both sell back to the customer.
00:03:32.009 --> 00:03:39.990
And, and the reason we did that was, you know, we were selling highly complex, typically very long enterprise type sales motions.
00:03:39.990 --> 00:03:40.740
And so I.
00:03:41.639 --> 00:03:55.650
When we're selling a new division to a large pharmaceutical company in Europe, oftentimes that takes on a life of itself, and you still wanna have the CSM dedicated towards all of the things that they do.
00:03:55.650 --> 00:04:02.129
So, you know, we would align the account executive to handle kind of the larger, complex selling motions.
00:04:02.430 --> 00:04:10.229
The CSM would still manage, you know, the, I would say more straightforward, upsell, cross-sell opportunities, but then also manage a renewal.
00:04:10.800 --> 00:04:14.189
And it created a really tight partnership between the two.
00:04:14.490 --> 00:04:17.100
Where we are, we're able to really grow with our customers.
00:04:17.100 --> 00:04:17.160
So.
00:04:18.209 --> 00:04:22.860
I think it really depends on what's, what's needed at that point in time for the company.
00:04:23.069 --> 00:04:41.430
Yeah, I think that makes a lot of sense and I, I've seen, I've seen a lot of similar, um, designs, like where a lot of the renewals, it does make sense to, in my opinion, to run through the CSM because they're the one engaged on the day-to-day, but definitely for expansion, depending on where the expansions.
00:04:41.834 --> 00:04:42.375
Occurring.
00:04:42.735 --> 00:04:44.024
That's a partnership.
00:04:44.055 --> 00:04:51.375
You want to be able to have, uh, the sales guy in working, especially if it's somewhere outside of the initial environment.
00:04:51.375 --> 00:05:00.225
But looking for the opportunity is such a, having the CSM help look for the opportunity because a lot of time, that's where, that's where it does come from.
00:05:00.285 --> 00:05:01.425
If you do have.
00:05:01.699 --> 00:05:03.019
That structure right?
00:05:03.230 --> 00:05:08.600
Where the CSMs helping with the renewal, but expansions coming from the ae.
00:05:09.139 --> 00:05:10.370
What do you see?
00:05:10.459 --> 00:05:14.720
Do you look, what kind of compensation structure do you like to see in that scenario?
00:05:14.899 --> 00:05:16.545
Yeah, it, it, it's a great, so I'll kind of.
00:05:17.040 --> 00:05:18.870
Share a, a couple of examples.
00:05:18.870 --> 00:05:25.889
So I think first it starts with clearly defining who owns what right across those two roles.
00:05:25.889 --> 00:05:37.649
And, um, you know, we created a, an internal document to align our team so they knew which selling motion, you know, they were responsible for, but we also incented them to support each other.
00:05:37.740 --> 00:05:46.350
And so, you know, when you add that element of you may get partial credit for a large expansion opportunities to CSM.
00:05:46.964 --> 00:05:53.324
You know, that also, um, helps kind of forge a, a pretty strong BO bond and partnership there.
00:05:53.985 --> 00:06:14.444
But when I look at a CSM comp plan, you know, things that I look for is balancing some of the commercial responsibilities such as that, you know, those quota bearing elements, cross-sell, upsell, but then also the renewal motion and balancing that with the non-commercial aspects such as.
00:06:14.644 --> 00:06:25.444
You know, driving, you know, a positive customer experience, high net promoters, things of that nature, and aligning the elements within the comp plan to incentivize the right behaviors.
00:06:25.444 --> 00:06:34.714
You don't wanna over rotate too much on the sales component, but you also don't want to, you know, over rotate on the, uh, on the non-commercial aspects as well.
00:06:34.714 --> 00:06:40.774
So I've often found kind of a 70 30 split has seemed to work really well.
00:06:40.774 --> 00:06:42.694
70% being the commercial.
00:06:42.975 --> 00:06:46.725
Quota related items, and then 30% being,
00:06:47.115 --> 00:06:47.535
you know, the
00:06:47.535 --> 00:06:48.975
non-commercial items.
00:06:49.365 --> 00:06:55.725
In that scenario, you're going with a 30% base and 70% based off of sales.
00:06:55.964 --> 00:06:58.125
Just making sure I understood it the way you meant it.
00:06:58.334 --> 00:06:58.545
Yeah.
00:06:58.545 --> 00:06:58.995
I'm sorry.
00:06:58.995 --> 00:07:02.115
So within the variable component itself?
00:07:02.115 --> 00:07:02.865
Within the variable
00:07:02.865 --> 00:07:03.524
component, yeah.
00:07:03.524 --> 00:07:08.834
Within the variable, it's typically 70, 30, 70% being kind of quota oriented.
00:07:09.735 --> 00:07:12.675
30% being, uh, non quota oriented.
00:07:12.915 --> 00:07:16.334
And how do you like to structure it from a total comp?
00:07:16.845 --> 00:07:26.235
Yeah, total comp two is usually 60, 40, 60% base, 40% variable up to, you know, 70
00:07:26.235 --> 00:07:26.714
30.
00:07:27.285 --> 00:07:29.175
You're definitely concerned when you've got churn.
00:07:29.384 --> 00:07:39.584
How are you kind of monitoring for, hey, these are churn risks versus, Hey, I'm, I'm expecting renewals to come this and this is, what are the key indicators?
00:07:39.584 --> 00:07:40.305
You're, you're
00:07:40.545 --> 00:07:41.475
a great question.
00:07:41.654 --> 00:07:44.084
I'm a firm believer in forecasting your.
00:07:44.790 --> 00:07:51.149
Your churn business and your renewal business just as sales forecast their new logo business.
00:07:51.629 --> 00:08:01.860
You know, I, I, I got into a, a motion with my last CFO where we would sit down about four or five months before the start of the new fiscal year, and we would plan out what.
00:08:02.165 --> 00:08:18.365
Anybody that we thought was at risk as a possible revenue churn or customer churn, and we would manage to that with the goal of beating our churn plan coming in under the dollar amount that we set forth, and we'd manage it all in Salesforce and then.
00:08:18.430 --> 00:08:23.350
We manage all the oppor, all of that data would be captured in the renewal opportunity.
00:08:23.350 --> 00:08:36.129
So as you're having a renewal discussions, you're also aware of what's at risk, why are they at risk, and then how do we mitigate that risk, um, in order to prevent as much churn as we can
00:08:36.490 --> 00:08:38.500
really from an engagement standpoint.
00:08:38.620 --> 00:08:43.720
Try, I, I'm guessing that try that tends to drive engagement for the renewal discussion.
00:08:44.519 --> 00:08:45.269
Much earlier.
00:08:45.809 --> 00:08:50.759
I used to, uh, tell my team, we've gotta start about a year in advance.
00:08:50.759 --> 00:09:02.279
And that doesn't mean you've gotta put a proposal in front of your customer 12 months in advance, but you've gotta start to have those conversations and you never have as much time as you'd like.
00:09:02.580 --> 00:09:05.429
And, and so it's, it's giving yourself more time.
00:09:05.429 --> 00:09:09.059
And if you can renew it early, that's, that's a good thing
00:09:09.059 --> 00:09:09.149
too.
00:09:09.870 --> 00:09:10.440
Awesome.
00:09:10.710 --> 00:09:12.899
Well, we appreciate those insights, John.
00:09:13.440 --> 00:09:21.120
On Friday we'll wrap up by exploring how AI can help you scale CS A CS team without losing the human touch.
00:09:21.360 --> 00:09:26.309
Don't miss it, like, subscribe, comment, and until then, keep on playing.
00:00:10.800 --> 00:00:14.070
Welcome back to the Customer Success Playbook podcast.
00:00:14.250 --> 00:00:21.570
I'm Kevin Medsker Roman, unfortunately is unable to join us this week, but we are here again with John Huber.
00:00:21.660 --> 00:00:27.239
It's Wednesday, which means it's time for one big question, but before we get into it, we're gonna.
00:00:27.519 --> 00:00:29.469
Loosen up with a few icebreakers.
00:00:29.620 --> 00:00:39.369
John, what's one song that always kind of fires you up before, like a big presentation or, you know, going into, to really close on something?
00:00:39.850 --> 00:00:40.960
It's a great question.
00:00:40.960 --> 00:00:42.429
I'm a big music fan.
00:00:42.969 --> 00:00:55.450
I say my go-to is a song called Disco by Widespread Panic, which is, uh, it's an instrumental song, just puts a smile on my face, very upbeat, uh, and kind of gets you in that right mindset.
00:00:56.399 --> 00:00:57.539
Widespread panic.
00:00:58.200 --> 00:00:59.844
They're, uh, yeah, you're an Atlanta guy.
00:01:00.155 --> 00:01:01.140
That, uh, what's that?
00:01:01.950 --> 00:01:03.179
I said, you're an Atlanta guy.
00:01:03.179 --> 00:01:04.920
They're from, uh, from your area.
00:01:05.010 --> 00:01:05.819
That's what I was gonna say.
00:01:05.819 --> 00:01:07.079
They're, they're big down here.
00:01:07.590 --> 00:01:12.209
If you weren't in customer success, what career would you pursue for fun?
00:01:12.209 --> 00:01:12.239
I.
00:01:12.659 --> 00:01:13.530
It's a great question.
00:01:13.530 --> 00:01:13.890
Fun
00:01:13.890 --> 00:01:16.439
being the optic, uh, optimal word.
00:01:16.469 --> 00:01:18.780
Uh, would love to be a professional golfer.
00:01:18.780 --> 00:01:30.840
My golf game is nowhere near, uh, suited to be a professional golfer, but man, I think it would be a ton of fun, uh, you know, to have that, uh, that time and uh, that passion.
00:01:30.840 --> 00:01:31.170
So,
00:01:31.829 --> 00:01:36.840
I don't know, I get so frustrated every time I get out on the course, I don't.
00:01:40.995 --> 00:01:42.885
It does seem like quite the life.
00:01:43.515 --> 00:01:47.745
What's your favorite thing to either cook or eat and, and, and Are you a cook or,
00:01:47.805 --> 00:01:48.495
I do.
00:01:48.555 --> 00:01:50.025
I do love to grill.
00:01:50.084 --> 00:01:51.974
You know, I think my wife and I both cook.
00:01:52.424 --> 00:01:54.165
Uh, I've got three girls at home.
00:01:54.165 --> 00:01:58.424
I did get a new grill last summer and it came with a flat top insert.
00:01:58.875 --> 00:02:02.775
I found myself just loving to cook on the flat top fajitas.
00:02:03.004 --> 00:02:03.094
Right.
00:02:03.424 --> 00:02:09.125
You know, chicken, veggies, smash burgers, um, you know, I didn't think I would use it at all.
00:02:09.125 --> 00:02:12.905
And I, I mean, we use it probably three or four nights a week.
00:02:12.905 --> 00:02:14.074
I absolutely love it.
00:02:14.794 --> 00:02:16.685
I got my Blackstone.
00:02:17.564 --> 00:02:19.935
Back before right around COVID.
00:02:20.150 --> 00:02:23.835
I I don't know if it was 2020 or whether it was 2019 that I got it.
00:02:23.835 --> 00:02:29.985
I know I was using it a ton during COVID, but, uh, I still still use it a ton to this day.
00:02:29.985 --> 00:02:34.544
I actually, I probably need to replace it at this point, but, uh, it's fantastic.
00:02:34.634 --> 00:02:35.985
Can do just about anything.
00:02:36.780 --> 00:02:37.289
You can,
00:02:37.289 --> 00:02:43.680
I haven't done breakfast yet, but I see a lot of people doing breakfast, so that's, that's my next, uh, my next challenge.
00:02:43.919 --> 00:02:45.120
Yeah, breakfast is good.
00:02:45.180 --> 00:02:46.590
I guess we should get into it.
00:02:46.590 --> 00:02:48.900
It's one Wednesday is one big question.
00:02:49.379 --> 00:02:51.599
Who should own expansion and upsell?
00:02:51.599 --> 00:02:54.990
Should it be in CS or should it be in sales Hybrid?
00:02:54.990 --> 00:02:55.710
What's your thought?
00:02:56.430 --> 00:02:57.960
Yeah, that's a great debate.
00:02:58.020 --> 00:03:00.330
And I, I would tell you it depends.
00:03:00.419 --> 00:03:04.080
Um, and I'll share a couple of examples because I've lived in both worlds.
00:03:04.590 --> 00:03:18.240
I've worked at a couple of companies where 12 months after the original deal was signed, the CSM would own, you know, the expansion, the upsell opportunities, the renewal opportunities.
00:03:18.300 --> 00:03:25.139
Like my most recent company as an example, we made a, a pretty important decision early on as we were building out the teams.
00:03:25.740 --> 00:03:32.009
To have an account executive partner with A CSM and both sell back to the customer.
00:03:32.009 --> 00:03:39.990
And, and the reason we did that was, you know, we were selling highly complex, typically very long enterprise type sales motions.
00:03:39.990 --> 00:03:40.740
And so I.
00:03:41.639 --> 00:03:55.650
When we're selling a new division to a large pharmaceutical company in Europe, oftentimes that takes on a life of itself, and you still wanna have the CSM dedicated towards all of the things that they do.
00:03:55.650 --> 00:04:02.129
So, you know, we would align the account executive to handle kind of the larger, complex selling motions.
00:04:02.430 --> 00:04:10.229
The CSM would still manage, you know, the, I would say more straightforward, upsell, cross-sell opportunities, but then also manage a renewal.
00:04:10.800 --> 00:04:14.189
And it created a really tight partnership between the two.
00:04:14.490 --> 00:04:17.100
Where we are, we're able to really grow with our customers.
00:04:17.100 --> 00:04:17.160
So.
00:04:18.209 --> 00:04:22.860
I think it really depends on what's, what's needed at that point in time for the company.
00:04:23.069 --> 00:04:41.430
Yeah, I think that makes a lot of sense and I, I've seen, I've seen a lot of similar, um, designs, like where a lot of the renewals, it does make sense to, in my opinion, to run through the CSM because they're the one engaged on the day-to-day, but definitely for expansion, depending on where the expansions.
00:04:41.834 --> 00:04:42.375
Occurring.
00:04:42.735 --> 00:04:44.024
That's a partnership.
00:04:44.055 --> 00:04:51.375
You want to be able to have, uh, the sales guy in working, especially if it's somewhere outside of the initial environment.
00:04:51.375 --> 00:05:00.225
But looking for the opportunity is such a, having the CSM help look for the opportunity because a lot of time, that's where, that's where it does come from.
00:05:00.285 --> 00:05:01.425
If you do have.
00:05:01.699 --> 00:05:03.019
That structure right?
00:05:03.230 --> 00:05:08.600
Where the CSMs helping with the renewal, but expansions coming from the ae.
00:05:09.139 --> 00:05:10.370
What do you see?
00:05:10.459 --> 00:05:14.720
Do you look, what kind of compensation structure do you like to see in that scenario?
00:05:14.899 --> 00:05:16.545
Yeah, it, it, it's a great, so I'll kind of.
00:05:17.040 --> 00:05:18.870
Share a, a couple of examples.
00:05:18.870 --> 00:05:25.889
So I think first it starts with clearly defining who owns what right across those two roles.
00:05:25.889 --> 00:05:37.649
And, um, you know, we created a, an internal document to align our team so they knew which selling motion, you know, they were responsible for, but we also incented them to support each other.
00:05:37.740 --> 00:05:46.350
And so, you know, when you add that element of you may get partial credit for a large expansion opportunities to CSM.
00:05:46.964 --> 00:05:53.324
You know, that also, um, helps kind of forge a, a pretty strong BO bond and partnership there.
00:05:53.985 --> 00:06:14.444
But when I look at a CSM comp plan, you know, things that I look for is balancing some of the commercial responsibilities such as that, you know, those quota bearing elements, cross-sell, upsell, but then also the renewal motion and balancing that with the non-commercial aspects such as.
00:06:14.644 --> 00:06:25.444
You know, driving, you know, a positive customer experience, high net promoters, things of that nature, and aligning the elements within the comp plan to incentivize the right behaviors.
00:06:25.444 --> 00:06:34.714
You don't wanna over rotate too much on the sales component, but you also don't want to, you know, over rotate on the, uh, on the non-commercial aspects as well.
00:06:34.714 --> 00:06:40.774
So I've often found kind of a 70 30 split has seemed to work really well.
00:06:40.774 --> 00:06:42.694
70% being the commercial.
00:06:42.975 --> 00:06:46.725
Quota related items, and then 30% being,
00:06:47.115 --> 00:06:47.535
you know, the
00:06:47.535 --> 00:06:48.975
non-commercial items.
00:06:49.365 --> 00:06:55.725
In that scenario, you're going with a 30% base and 70% based off of sales.
00:06:55.964 --> 00:06:58.125
Just making sure I understood it the way you meant it.
00:06:58.334 --> 00:06:58.545
Yeah.
00:06:58.545 --> 00:06:58.995
I'm sorry.
00:06:58.995 --> 00:07:02.115
So within the variable component itself?
00:07:02.115 --> 00:07:02.865
Within the variable
00:07:02.865 --> 00:07:03.524
component, yeah.
00:07:03.524 --> 00:07:08.834
Within the variable, it's typically 70, 30, 70% being kind of quota oriented.
00:07:09.735 --> 00:07:12.675
30% being, uh, non quota oriented.
00:07:12.915 --> 00:07:16.334
And how do you like to structure it from a total comp?
00:07:16.845 --> 00:07:26.235
Yeah, total comp two is usually 60, 40, 60% base, 40% variable up to, you know, 70
00:07:26.235 --> 00:07:26.714
30.
00:07:27.285 --> 00:07:29.175
You're definitely concerned when you've got churn.
00:07:29.384 --> 00:07:39.584
How are you kind of monitoring for, hey, these are churn risks versus, Hey, I'm, I'm expecting renewals to come this and this is, what are the key indicators?
00:07:39.584 --> 00:07:40.305
You're, you're
00:07:40.545 --> 00:07:41.475
a great question.
00:07:41.654 --> 00:07:44.084
I'm a firm believer in forecasting your.
00:07:44.790 --> 00:07:51.149
Your churn business and your renewal business just as sales forecast their new logo business.
00:07:51.629 --> 00:08:01.860
You know, I, I, I got into a, a motion with my last CFO where we would sit down about four or five months before the start of the new fiscal year, and we would plan out what.
00:08:02.165 --> 00:08:18.365
Anybody that we thought was at risk as a possible revenue churn or customer churn, and we would manage to that with the goal of beating our churn plan coming in under the dollar amount that we set forth, and we'd manage it all in Salesforce and then.
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We manage all the oppor, all of that data would be captured in the renewal opportunity.
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So as you're having a renewal discussions, you're also aware of what's at risk, why are they at risk, and then how do we mitigate that risk, um, in order to prevent as much churn as we can
00:08:36.490 --> 00:08:38.500
really from an engagement standpoint.
00:08:38.620 --> 00:08:43.720
Try, I, I'm guessing that try that tends to drive engagement for the renewal discussion.
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Much earlier.
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I used to, uh, tell my team, we've gotta start about a year in advance.
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And that doesn't mean you've gotta put a proposal in front of your customer 12 months in advance, but you've gotta start to have those conversations and you never have as much time as you'd like.
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And, and so it's, it's giving yourself more time.
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And if you can renew it early, that's, that's a good thing
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too.
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Awesome.
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Well, we appreciate those insights, John.
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On Friday we'll wrap up by exploring how AI can help you scale CS A CS team without losing the human touch.
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Don't miss it, like, subscribe, comment, and until then, keep on playing.
