Customer success: the formula for growth

The rapid shift towards cloud computing and software-as-a-service purchasing models is freeing technology buyers from vendor lock-in, upfront payments, long implementation cycles and heavy software customisation. That means software vendors and their partners need to focus on continuous customer success if they are to grow and retain their customer base over the long run. This was my key message as a speaker during the Sage Enterprise Management Partner Summit, held in Dubai last month.

In practical terms, this means we are seeing customers expect vendors and implementation partners to help them deliver against their business outcomes. Efficiency and scalability are no longer enough – as the recent IDC European Enterprise Services Survey shows, the number one priority for technology buyers is for their providers to deliver results against their desired business outcomes.

Customers want inspiration, innovation, guidance and solutions. If they don’t get if from one vendor or service provider, it is easy to move to another in the digital and subscription world. This means technology vendors and resellers that want to thrive in today’s market must pivot to a customer success-driven approach.

The emphasis moves away from features, functionality and cost, towards ensuring the tech company delivers on the customer’s business outcomes. If the vendor does not get this right, the customer will not renew its subscriptions, let alone buy more solutions and products from the provider or become an advocate for its brand.

Here are three steps towards becoming a customer success-driven enterprise:

1. Start with the end in mind

Large-scale enterprise software deployments don’t have the best track record. They often fail to deliver the expected benefits or run over time or budget. To improve success rates, vendor, implementation partner and client must begin each project by defining what success looks like in terms of the desired business outcome and how it will be achieved.

This begins with an honest assessment not only of the service provider’s ability to deliver on the brief, but also of its success potential. If there is a significant divide in the culture and expectations of vendor and client, the project is not likely to succeed. The effort is also likely to fail if the client doesn’t have the necessary skills, platform or change capabilities for the transformation.

When defining customer success, a generic benefit like saving time or becoming efficient is not enough. One should have a detailed, measurable definition of success, whether the goal is better budgeting, more accurate reporting, cost reduction or production increases. Knowing the desired outcome and regularly measuring against defined success milestones and metrics increases the likelihood of customer success.

2. Remove silos and barriers between customers

Leave behind discussions about who owns the customer relationship within the enterprise or its wider partner network—vendor, implementation partner, third-party software provider. Customers want solutions to their business problems, which in today’s complex world requires the cooperation of cross-functional and cross-organisational teams.

It’s up to all parties, vendors and service providers to align themselves behind the customer’s goals and to make it easy for the customer to interact with their team. Breaking down silos means establishing shared strategic metrics to measure collective success. This requires a mindset change, from a transactional focus on project profitability towards focusing on retention, repeat business and references.

3. Design services for the future

IDC predicts that, by 2021, 30% of the tech partner ecosystem will not exist in the form it does today. But it also forecasts that 70% of cloud service providers’ revenue will be mediated by partners in the same timeframe. However, the services that business partners provide may evolve along with the move to the cloud.

At Sage, we agree that our Sage Enterprise Management Partners will be a key part of our continued journey to the cloud, which is why we are continuously working to align with them to create customer value and success. We envisage there will be less customisation work to be done, but that data security, cloud integration, business strategy, change management and other services will only become more important.

Together with our partners, we are looking at tomorrow’s tech opportunities, from artificial intelligence (AI) to blockchain. We are also thinking about how the market and customer will change. Millennials are moving up the ranks and emerging as decision-makers. Are we ready for this confident, tech-savvy IT purchaser who demands instant gratification and collaboration?

Are we able to recruit the young talent we need to serve these customers and their needs? How can we capitalise on the explosive opportunity of new and emerging markets to further growth? Change is constant and brings enormous opportunity.

The future is about customer success

The successful IT services and software companies of the future will be totally client-aligned through sharing risks and rewards, joint ventures and other means. They will use external technology and ecosystems to their augmented capabilities, building better customer solutions and outcomes. They will do what it takes to make their clients succeed – because that’s their only path to exponential growth.