How Productivity Influences CS Outcomes

Learn why it is critical for CS organizations to clearly map key objectives and results to keep CSMs on track and productive.

Last Updated: October 2022

In B2B SaaS, CSMs are center stage for anything customer-related. CSMs are responsible for everything that happens starting from when the customer buys your product to then on. Ultimately, this means that the CSM will be responsible for onboarding, training, leading, retaining, and growing the customer throughout the customer's lifecycle.  

The ultimate goal of any CS organization is to retain and grow revenue that come from existing clients, but there are many objectives a CSM has to achieve to reach this ultimate goal. That's why CS organizations should clearly map these KPIs to keep CSMs on track and productive. By doing so, CS organizations can stay on the path of retention and growth within their installed customer base.

In this blog, readers will understand the definition of the main CSM outcomes in B2B SaaS, why they are important, how they differentiate from each other, and how to combine CSM outcomes with productive habits to build an efficient and effective CS operation.

Defining the Different Types of CSM Outcomes

Different elements form Customer Success outcomes, and each one of these elements has its purpose and function within the CS operation; OKRs, KPIs, and metrics.

Customer Success OKRs (Objectives and Key Results)

OKRs should represent aggressive goals that signify meaningful business growth and improvement in the organization. OKRs should be measurable and are usually set on a quarterly basis, although some OKRs can be set on an annual basis. Moreover, OKRs determine what should be the focus and direction of the organization during a set period of time. That’s why it’s important to clearly map and understand the impact of the OKRs that are set. This clear understanding will keep CS teams productive and on track with their tasks and goals; otherwise, you could have a whole organization working and focusing on OKRs that won’t necessarily lead to business growth or improvement.

Customer Success KPIs (Key Performance Indicators)

OKRs and KPIs go hand in hand. The best way to understand if an organization will achieve an objective is by using KPIs, which keep teams productive and moving in the right direction. You can think of them as pulse checks, letting the team know how close or far away they are from hitting set objectives. Traditionally, KPIs are less aggressive than OKRs; therefore, they are easier to achieve during a shorter period of time. 

Additionally, it is important to note that an OKR can be composed of multiple KPIs. For instance, if the OKR is to increase net revenue by 20% by the end of the quarter, then the CS organization could have the following KPIs in correspondence with the OKR:

  • Maintain a 98% net retention rate
  • Reach $X in upsells

Customer Success Metrics

Unlike OKRs and KPIs, Customer Success Metrics are used as tools to measure the business's overall health and are not subject to a specific timeframe or goal. Having metrics in place is key to understanding what needs to be prioritized, improved, or fixed on a very detailed level without waiting until the deadline approaches. In addition, well-defined metrics enable teams to be productive and "steer the boat" back on track to hit KPIs and OKRs.

Understanding Customer Success Metrics, KPIs, and OKRs and how they are connected will allow teams to take their CS framework to the next level. These indicators should help CSMs and CS leaders assess the "health" of their book of business and any other element(s) a part of the desired outcome. Ultimately, CS organizations can define what Customer Success OKRs, KPIs, and CS Metrics fit their goals best, how to deliver the proper training and tools to keep their teams productive, and ultimately develop a strong CS strategy and overall framework.

How to Measure CSM Outcomes Against the Set Goals

Once the organization clearly defines the OKRs, KPIs, and metrics, it's critical to determine how the company and its CS teams will measure against them. One way to do this is by inputting these goals into a platform that automatically connects with the company's current product, customer support, and CRM systems. 

Connecting the CS platform to the platforms and systems actively used allows you to compare CS Outcomes to product usage, product stability, customer service requests, and retention and growth opportunities. In addition, being fully connected will allow the CS org to pull real-time data quickly from the most relevant platforms. Such data will help teams stay productive and build insightful reports that measure every metric needed to develop the right strategy to hit desired outcomes and goals. Measuring progress toward CS goals without a CS platform is like using a shoe as a hammer. You can do it, but it will be far more difficult, plus less effective and productive for your team.

Now that we understand the different types of CS outcomes, how they're connected, and how to make them visible and accessible to your CS team, we can review the essential OKRs, KPIs, and Metrics in B2B SaaS. We'll also touch on why they are so important and how to measure them correctly.

Objective 1: Improve Net Revenue Retention (NRR) Rate

Why: This objective should be within the top priorities of any B2B SaaS business since this not only measures how much revenue a company is able to retain but also how much a business grew over a period of time.

How: NRR = ((Starting ARR/MRR + Expansion ARR/MRR - Contraction ARR/MRR - Churn MRR) / Starting MRR/ARR) * 100

Example KPIs to set:

  • Keep quarterly churn under 5%
  • Reach a quarterly net retention rate of 110%

Example Metrics to use:

  • Churn %
  • Renewal %

Objective 2: Improve Onboarding Flow and Experience

Why: This objective should push the CS organization to focus on getting customers fully onboarded with a more efficient and personalized flow. This can significantly reduce churn, increase product adoption, improve CS team productivity and decrease time to value.

How: A quick way to do this is by segmenting your customers based on their industry and mapping out what features are the most relevant to them. Once you have that in place, all you need to do is customize it according to the customer’s specific needs. 

Example KPIs to set:

  • Improve Onboarding NPS overall score by 20%
  • Reduce onboarding completion time by 1-2 weeks

Example Metrics to use:

  • NPS
  • Feature usage + adoption rates

Objective 3: Increase Product Usage and Adoption

Why: This objective should push the CS organization to develop a strategy that will lead to more product usage, also known as product stickiness, and broaden feature adoption. This should lead to more renewals and growth or expansion opportunities.

How: The best way is to connect your product with your CS tool; then you can easily measure usage metrics such as DAU/MAU, retention, etc. You can also have full reporting on feature usage per user or per account.

Example KPIs to set:

  • Increase DAU/MAU to 80%
  • Reach 90% feature adoption on all onboarded accounts

Example Metrics to use:

  • Signups/Logins
  • User Flows
  • Feature adoption metrics

Objective 4: Increase the Tier Level of Accounts

Why: If your product positively impacts your customer’s business, your product becomes more mission-critical for your customers. This objective should enable CSMs to develop a value-led growth strategy to see both the customers and the company succeed.

How: Higher-level tiered accounts are determined by ARR or MRR—other companies may take other metrics into account, like headcount or logo recognition. It is vital to have clear and defined customer segmentation in place to measure this.

Example KPIs to set:

  • Open at least 10 opportunities per quarter
  • Increase tier level of at least 5 accounts per quarter

Example Metrics to use:

  • Product usage (seats or consumption)
  • Number of open trials

Objective 5: Improve Customer Support 

Why: This objective should enable CS organizations to focus on productivity, helping reduce the time it takes to solve a support issue and minimize the dependency on customer support to get involved in cases where technical support isn't necessarily needed. Ultimately, improved productivity for the CS team will lead to a smoother and better customer experience.

How: One way to do this is by connecting your CS tool to the team's customer support tool. By connecting the two, the team will have complete visibility of how many tickets are open, what the subjects are, and how long it takes to close a support case or ticket.

Example KPIs to set:

  • Reduce time to close ticket/case by 25%
  • Reduce the total number of support tickets by 10%
  • Reduce non-technical support tickets/cases by 30%

Example Metrics to use:

  • Health Score
  • # of open tickets
  • Customer support metrics

Final Thoughts

In this blog, readers now have a clear understanding of what the differences are between OKRs, KPIs and CS Metrics, how CS departments should utilize each them individually and together, and how to accurately define them based on the needs of their respective Customer Success organization. Knowing what KPIs and metrics are needed to measure given objectives and the impact each metric will provide towards your CS outcome are key to establishing a productive direction and focus for the organization. Lastly, having clearly defined and quantifiable customer success goals will take Customer Success from a 'nice-to-have' department to a mission-critical, revenue-driving department in the eyes of executive leadership.

For Customer Success teams hoping to drive department wide productivity and achieve CS outcomes to the fullest, see how the Vitally Customer Success platform can empower your CS org with a personalized demo.

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