Value-Centricity Is The New Customer-Centricity
Many companies are successfully putting customer-centricity at the heart of their Customer Success (CS) organizations, but are missing the mark on customer value creation. Customers expect companies to discern and fulfill their unique needs and goals, but 66% of customers reveal that companies routinely fail to understand them (Salesforce, 2020). Many CS leaders have created a false positive correlation between customer sentiment, Net Promoter Score (NPS), and the actual achievement of measurable value by customers.
In order to maximize net revenue retention, recurring revenue businesses must upgrade from their customer-centricity culture to a value-centricity culture. This upgrade requires the transformation of pre- and post-sale teams, processes and technology towards a value-based outcomes model.
Value-based outcomes are prescriptive and measurable outcomes that are tied directly to product adoption and create and sustain measurable value realization for customers. At Valuize, we have been strong proponents of value-based outcomes from our founding. One of our first principles is that the repeatable and scalable prescription and delivery of value-based outcomes is the key to maximizing customer retention and expansion.
To establish a culture of value-centricity, your teams, processes and technology must all contribute to the achievement of value-based outcomes by customers. If, for example, you don’t have success plans with defined value-based outcomes agreed with each of your customers, you do not have a culture of value-centricity.
Here’s how you can align your teams, tools and processes to establish value-centricity and, as a result, success for your customers and your recurring revenue business.
Core to establishing value-centricity in your company is recognizing that it does not just apply to one team. While Customer Success is usually tasked with customer value creation, it needs to be a shared responsibility that’s implemented from acquisition all the way through to the post-sales motion.
The integration of your Sales, Customer Success, Professional Services, Technical Account Management, Support teams is critical to enable a unified customer lifecycle that drives measurable value realization for your customers. Value-centricity forms the cultural link that enables this cross-company team integration.
Assess the incentivization models, role definitions and engagement models across your teams to identify gaps and conflicts that could hinder the smooth flowing of customer value creation and delivery across these teams.
Traditional customer lifecycle management technology (CRM, helpdesk, Customer Success technology etc.) cover the system of customer record, system of customer insight and system of customer action required for a culture of customer-centricity. To establish value-centricity, it is essential to integrate a system of customer engagement that drives direct collaboration with the customer on the agreement, delivery and measurement of value-based outcomes.
This engagement layer brings the customer directly into your culture of value-centricity and avoids your teams and the customer having to bridge value-centricity via emails and Zoom calls. A powerful initial use-case for a system of customer engagement is the process of success planning with your customers (and prospects).
A culture of value-centricity is built upon the recognition that the path to value realization for a customer does not begin on Day 1 of the customer’s subscription. It begins during the customer acquisition stage of the customer lifecycle, i.e. during the sales process.
The first 90 days of a customer’s journey are the most critical and precarious of a customer’s entire lifecycle. The value delivered in this initial adoption period has a huge impact on whether a customer will churn or renew and expand. Therefore, Day 1 must be about value delivery not about value diagnosis, quantification prescription or agreement. These stages of the value cycle need to occur presale to enable value delivery to start on Day 1
We suggest including the customers in the hand off process and in the measurement of value realization, making that whole steel thread a collaborative experience. The end result is a shared success plan backed by data where customers play a role in their own success because there’s mutual accountability in the achievement of identified outcomes.
For a deep dive into how to implement value-centricity across your organization, listen to my conversation with Adrian Brady Cesana on the CXChronicles Podcast.
Build A Future-State Customer Success Organization
Value-centricity is the new customer-centricity, and a new wave of market-leading software companies are evolving and refocusing their entire organization to implement this new value system. If your company is stuck focusing on the customer experience without thinking about customer value creation, you’re in great danger of missing the mark. To stay ahead of the curve, align your team, tools, and processes around value-based outcomes that drive a repeatable and scalable path to customer value realization.
Designing customer value-based outcome strategies and the processes to deliver them is what we specialize in at Valuize. Discover how we help some of the largest software companies maximize their recurring revenue growth and future-proof their customer lifecycle strategies, organizations and technology.