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17 January 2019

Applying Lean Management To Accelerate Your Customer Success Process

by Ross Fulton Reading time: 7 mins

Will buying sales software give your B2B SaaS company a great sales strategy? No. It won’t.

Most sales leaders know this. Great sales software will operationalize a great sales strategy. It will enable the strategy to be executed and managed efficiently, effectively and, sure, maybe improve it. That’s why sales leaders buy sales software.

Yet, most customer success leaders seem to think that if they buy customer success software it will give them a great customer success strategy. It won’t.  Your B2B SaaS company needs a well-designed customer success strategy first. This can then be operationalized, scaled and optimized in a powerful customer success software, such as Gainsight.

Take your customer onboarding process as an example. If your onboarding process has 20 redundant steps, confuses the customer and, worst of all, fails to deliver value…customer success software alone will not fix this, at least not with today’s technology.

Sure, there is a time coming when customer success software will use  ‘AI’ to analyze your B2B customer onboarding process, your customers, your product and your market and proactively recommend what steps to take with the next customer in order to have X% chance that the customer achieves a meaningful first value within Y days. This is already happening in retail customer lifecycle management.   

But we’re not there yet in B2B. In the meantime, you need to rely on yourself and your team to design and build the right customer success process that will make your customers successful. At Valuize , we help leaders of B2B SaaS companies achieve this.

One great tactic for both designing and optimizing your customer success process, like onboarding, is to apply principles from Lean Management. I recently had the opportunity to sit down with the multi-talented Pedro Candelas, Director of Customer Success and Support at Venzee, to discuss how he is seeing success in applying Lean Management to his Customer Success strategy.

Pedro, how about we start with you introducing yourself?

Thanks Ross, I am Pedro Candelas and I recently moved to Vancouver, Canada, from Baja,  Mexico. I’m the Director of Customer Success and Support at Venzee, a Vancouver-based publicly traded company. Before joining Venzee, I spent 12 years in Operations and Support roles for the Aerospace industry, where I was certified as a Lean Six Sigma Green Belt by Honeywell Operational Systems and few years after as a Black Belt by Rockwell Collins Operational Excellence System.

For those who aren’t familiar with it, can you give us a quick overview of where Lean Management originated?

A lot of innovation in Operations Management has happened since the first Model T rolled out of Ford’s Detroit assembly line 110 years ago. Since then we’ve seen concepts like Standardization and Best Practices by Frederick Winslow Taylor and Error Proofing (Poka Yoke) by Shigeo Shingo become core elements in today’s operations.

In post-war Japan, an engineer by the name of Taiichi Ohno began pulling all of these concepts together into what would become the Toyota Production System. This was then later adopted in the U.S. and renamed Lean Manufacturing.

Now, the concept of Lean Management has been implemented across all industries. Manufacturing, banking, health services, government and, more recently, tech companies where it was rebranded as the Agile framework.

When did you first apply Lean Management?

I spent the first years of my career in the fast-paced Aerospace Industry where every minute a plane spends waiting on the runway costs thousands of dollars to Airlines.

Sounds similar to how every day a new customer spends waiting to realize value from the software they just invested in churn risk increases for the software company.

Exactly! I learned that with the use of Lean Management tools we were able to move an operational repair facility from Miami airport to a world-class repair center down in Mexico and have it operational within a week. We reduced our turnaround time from 72 hrs to 24 hours, cutting our costs and improving our customer happiness.

So when I moved into my current role as Director of Customer Success and Support at Venzee, I saw an opportunity to apply the Lean Management concepts that I learned in the aerospace industry to our customer success and support processes and achieve the goal of making our customers happy.

What role do you see Lean Management playing in Customer Success for B2B SaaS?

When most of us think about software companies, we immediately think about the tech, automation and apps. We also need to prioritize thinking about the human processes that support that innovation. This is where Lean Management comes in.

If your software product is what primarily brings the customer to your company, it’s the processes that primarily help you retain and expand them.

In a tech environment, we are so used to always looking for innovative and new approaches that we sometimes lose sight of valuable tools that have been around for years. A good example is Value Stream Mapping (VSM) -a key element of lean management.

VSM is, typically, a 3-day event requiring participation from your Subject Matter Experts, corporate sponsors (e.g., executive team), and, most importantly, a customer or someone acting as a customer.

On Day One you map the current flow, identifying all those activities that are part of the customer journey. You will be surprised what you will find. Duplicated activities, gaps in the process or even activities that no one really knows why they exist!  

On Day Two identify those non-value adding activities and think about how you can eliminate or at least mitigate them. This will help deliver quick wins and more value faster to your customers.

On Day 3 comes the most important step in VSM. Creating an Action Item List with all the activities, completion dates and responsible team members that are required to transform the process from the Current to the Future state. Follow up is required for the success of Customer Success!

VSM is certainly a powerful exercise. Can you share an example of when you recently applied it?

Sure. This past November we set out to meet a very ambitious goal: to reduce our onboarding lead time from 3 weeks to 1 week before the end of Q1 2019.

I gathered representatives from each internal team for the company’s Customer Success and Sales VSM, which we held as a 3-day offsite event. We began the planning and preparation work for the event the week prior.

We spent time identifying our minimum viable customer – defining the attributes that a customer must have in order for our success team to onboard them successfully, as well as operational goals, like reducing customer processing time and other desired efficiency gains. While the goals for your VSM can be very creative, it’s important that they are SMART goals.

There’s no magic involved! VSM requires team-effort and, as with any other process change in a company, you’ll need full buy-in from the team members. But that is the main benefit of the VSM event: the people doing the work day to day are the ones designing the new process. Going through the mapping of the existing process and identifying issues and opportunities is an eye-opening experience for the people involved and the company overall. Yes, do expect some heated conversations!

At the end of the three days, we came out with an ambitious action item list that we agreed to implement. The whole team is committed to making the changes happen as we all believe that the new process we designed will make our customers happier, our employees more engaged and will, overall, increase our revenue.

Sounds game-changing for Venzee. Thanks for sharing your expertise and experience Pedro. Looking forward to hearing about the final results!

Ross Fulton

Prior to founding Valuize, Ross spent over 16 years growing software companies and their partners in go-to-market strategy, sales engineering and customer success leadership roles on both sides of the Atlantic. An Englishman by birth but not by nature…he’ll take an espresso over tea every time!