Why does the journey from new customer acquisition to the renewal and expansion of the relationship involve five or more different departments?
Organizational Specialization or Isolation?
While it makes sense to have specialized teams to sell and service customers, the way these teams are organized is broken. Organizational silos create barriers to customer success by inhibiting the levels of coordination and cooperation necessary to retain and grow customer relationships.
Do you remember the game telephone?
One person whispers a message to the next person and he/she whispers it to the next person and so on. By the time the message is passed to the last person the message has changed from the original. This same phenomenon occurs when multiple departments engage and serve customers.
The hand off from one department to the next creates gaps between expectations set and how they are met.
Are post-sales teams working towards the same goals?
Good communication is key, common goals and objectives are imperative. Distinct organizations may be motivated to achieve different and possibly conflicting outcomes.
If Sales is motivated to book new license revenue but not incented to think about retaining the customer relationship could this lead to potential issues? The short answer is, yes.
The key is to align all customer interactions to the attainment of common goals – both short-term and long-term. Each step in the customer lifecycle must contribute to a common outcome such as the retention of a customer relationship (or protection of revenue) and no individual or department should be rewarded simply for the achievement of interim milestones (e.g. closing a new deal).
New Customer Success roles are not enough
Efforts to add success mangers, onboarding teams, or renewal and expansion sales roles are stopgap measures to address some of the inefficiencies of siloed post-sales organizations. These stopgap efforts are not enough.
The Bottom Line
Post-sales coordination and cooperation is the key to customer retention and relationship revenue growth and provides opportunities to achieve greater staffing efficiencies. If you cannot achieve the necessary level of inter-department cooperation within your current post-sales organizational structure it’s time to tear down your silos.
Check out Are You Organized for Customer Success – it reviews our findings about current post-sales organizational structures and offers some insights about what you can do to address these issues.