PUBLISHED BY Bryan Stolle
November 9, 2018
We’ve established in Parts 1 & 2, that professional services are a significant part of many successful SaaS company playbooks, and we have identified the scenarios where it’s important to build out a professional services capability. So, what now? What are the key components of these playbooks, that create a service offering effectively addressing the critical customer life-time-value objectives of:
- High customer satisfaction and success
- Low churn
- Faster expansion
- Higher net churn (= Expansion – Churn)
I reached out to two former colleagues who are long-time SaaS Customer Success practitioners, to provide additional commentary and color to the following list of Professional Services tips, tricks and hacks. Eric Schrader (VP Professional Services) and Guillaume Vives (VP Global Services) were both Customer Success execs for me at Agile Software (NASDAQ: AGIL). Eric was subsequently VP of Global Professional Services at Coupa (NASDAQ: COUP) while Guillaume went on to be SVP Professional Services and then SVP Product at Zuora (NYSE: ZOU). Both have been professional services execs from the early startup phase all the way through to public company status.
Professional Services/Customer Success Tips, Tricks & Hacks
1. Fixed-priced service packages – If your SaaS company has deep domain knowledge around the business problems being served, and a knowledge base of best practices, it’s possible to bundle service offerings containing the most common implementation and deployment tasks, with a fixed scope of work, at a fixed price. I’ve used this approach several times as an operator with great success – we saw a significant decrease in sales cycles, much more rapid deployments with much less drama, and higher customer success rates. Packaged services reduce complexity, contains scope creep, helps the customer better understand the nature of the project, and makes the customer feel more confident about the real costs of acquiring the app and their probability of success.
An added benefit for the SaaS provider is that packaged services a) significantly reduce training and learning curve time for new hires in the professional services and sales group, and b) allow a company to onboard third-party consultants and professional service providers much more easily and quickly, expanding the ever-critical eco-system.
GV: One alternative is to sub-contract fixed-priced packages to 3rd party consulting firms, where they have an incentive to deliver as fast as possible to reduce their cost and improve their margin. When doing so, measure 1) post go-live success through NPS score at 30 to 90 days and 2) measure engagement for key users. Too often customers “rushed” by a 3rd party, never fully transition to the new solution, resulting in churn risk at time of renewal. Early on at Zuora, simple metrics such as NPS Score => 8 at 30 days post go-live and “all key users engaging more than twice a week and spending at least 30 minutes in the application” became the milestones for completion of the go-live serviced by 3rd parties.
ES: If you segment SaaS apps into “Tools” vs. “Process Centric”, fixed price services work better in “Tools”, but are more challenging for highly integrated, process centric apps that involves change management. For “Process Centric”, the solution is higher value and requires a deeper service model. Many times this service model needs to work in concert with systems integrators (SI’s). Success is not just based on the implementation of the software, but the evolution of current processes. Fixed-price and SIs don’t mix well and it’s imperative that the SaaS provider align services rates and scoping to work seamlessly with an SI ecosystem. Coupa is an example of a “Process Centric” solution vs. something like Slack or Box or even things like Mix Panel and Pendo.
Me: Complex implementations do indeed require more sophisticated and agile service offerings. That said, even in process centric apps, a simple or limited-scope initial deployment can often be approached with a ”fixed price/fixed functionality & scope” professional service offering. The key is to be very clear about what’s “in” and what’s “out” of scope. The objective is to get a quick win and build customer confidence and commitment to a larger more robust and comprehensive roll-out. This approach works especially well with the “land & expand” go-to-market approach.
2. Pre-built integrations to key companion apps – Similar to fixed price services, standardized off-the-shelf integrations speed the implementation cycle and reduce complexity. It also makes it far easier for the customer support team to diagnosis and remedy integration issues.
GV: Sometimes these pre-built integrations require licensing of 3rd party technology (for ex: Mulesoft or Boomi for middleware). It is important that the SaaS subscription sold to the customer include the cost of the 3rd party solution to avoid having to sell an add-on later on during the implementation.
ES: Spot on – especially looking at it from an eco-system perspective. It reduces adoption friction, leverages investments that customers have already made and becomes a multiplier on the marketing front.
3. Off-the-shelf data ingestion/ETL tools – Most business processes have significant prior history, be it customer demographic data, previous transactions, etc. Some or all of it will need to be moved into the new SaaS app. This historical data is in legacy apps, in spreadsheets (far more common than most would think), or spread across several different previously unconnected systems serving various parts of the business process in question. Having a standard tool, and pre-built data maps to the most common data sources will significantly reduce implementation time and reduce mis-catalogued data.
GV: Quality of the data is a make or break factor in the long-term success and stickiness of the new SaaS solution. During the sales process, the customer’s exec sponsor should plan for the data migration and identify a specific individual to be in charge of data extraction, working with the services team. Putting these tasks on the quarterly MBO list for the customer team and exec is a good way to ensure success of the data migration.
ES: If executed correctly, the data can become: 1) the baseline for defining value creation and 2) act as a diagnostic and a way to scope the priorities of the initiative. With the historical data, we can often see where the issues are and where we can focus to drive the best time-to-value.
4. Pre-loaded business process templates – Pre-configured templates also greatly accelerate app deployment. Often, they are oriented around specific verticals and the “lingo” and workflows specific to said verticals. At Agile, for example, we had individual templates for Electronics Manufacturing, Medical Device, Pharmaceuticals, and CPG.
ES: This is table-stakes! Most customers are looking to their SaaS providers to come with Best Practices and be the expert. Customers are looking to SaaS providers and their partners to bring that expertise in the form of templates, frameworks and industry playbooks.
5. Keep the exec sponsor in the loop – This is so critical, but often overlooked in the focus to get the implementation project completed. Scheduled progress meetings with the executive sponsor keeps them engaged; better equipped to manage and hold accountable the team they delegated the work to, especially when the team hits speed bumps; and to bring additional (or better) resources to bear if the project is lagging.
Bonus Idea #1: Extend this practice post go-live, with the focus shifted to the app’s performance and business/ROI impact. Pays off at renewal time in higher certainty of renewal and less effort to avoid churn.
Bonus Idea #2 (Courtesy of ES): Create a presentation template for the exec to communicate upwards about the success and impact of the program. Many times, the SaaS provider can help the sponsor better communicate value and impact over time to upper management. The goal should be “what can you do to get your exec promoted”!
GV: Keeping the exec sponsor involved beyond just problem escalations is an excellent practice. The more the exec is engaged during the “good” phase of the implementation, the more (s)he will take this project seriously and will be able to assist when issues arise.
ES: Post-sale executive engagement should start at Kickoff with the definition of outcomes and success metrics; continue with monthly or bi-weekly Steering Committee meetings to ensure governance and avoid goal-drift; then move to a Quarterly Business Review or at least semi-annual Executive Business Review to maintain joint focus on value creation.
6. Set metrics to measure success of the first deployment – Goes hand-in-hand with keeping the sponsor in the loop. A set of well-defined business objectives and associated metrics works wonders to keep the team focused, the project on-track, and management happy. It also has a remarkable impact on upsell/expansion and renewals.
GV: traditional services organization tend to create lots of metrics. Simple is best! The two most important questions you need to answer are 1) actual value delivered and 2) perception of value and satisfaction. A simple value dashboard and a quarterly survey (sometimes one question is good enough: ”how satisfied are you on a scale of 0 to 10!”), will tell you as much as a twenty-question survey.
ES: Leverage the insights from the historical data and/or industry or internal benchmarks to help make this point.
7. Instrument the app to monitor usage – Key to delivering on the last two points, quickly, accurately and efficiently. When you can present real-time data on what’s happening in the app, how many users are on the system, how many transactions are flowing through the system, etc., you can show the customer what’s working and what still needs more workflow improvements, training, etc.
Bonus Idea: Determine which metrics best measure when a minimum viable deployment has been reached, defined here as “the point where the customer is getting measurable and impactful business value, and the likelihood of churn drops significantly”. Treat the customer as a prospect, until the minimum viable deployment has been achieved.
GV: Some of my favorite tools for professional services teams:
- Wootric for simple customer success measurement
- Asana for project management
- FullStory to see who is using the SaaS solution and review all the recordings of the usage sessions. It is very useful to identify who is struggling with the application and needs additional training
Read the original blog post in Forbes here.