Lagging & Leading Indicators Part 3: Engineering Future Expansion
How to be a leader on lagging indicators is a Planhat hosted webinar with Christian Jakenfelds, Higher Logic’s CCO, Jay Nathan, Smartly’s CCO, Ryane Laredo, and 6Sense’s Kerry Cunningham, discussed lagging and leading indicators at length.
They chatted all things leading and lagging indicators, and how to use them to achieve better outcomes.
Part 3 covers how current satisfaction scores can be used as leading indicators for future expansion.
“Just because there’s “No imminent churn” doesn’t mean there’s “Inherent strength” in your relationship,” and building onto a good satisfaction score needs to happen now, not later on.
With three different perspectives on customer success and the use of leading indicators, the Planhat webinar was incredibly insightful and well-rounded on how leading indicators are not only useful in building customer health scores, but also in contributing to customer conversations and expansion efforts.
Takeaway 3: Use Current Satisfaction to Engineer Future Expansion.
There are obvious indications that your customer is a good fit but how can you tell if they’re going to continue to work with you? Is it going to be completely based on their satisfaction in the now?
“High health is a leading indicator,” to the current satisfaction of a customer Ryane explained but, if you’re not capitalizing on these good metrics, you’re not going to see long term growth.
“No one should walk away happy with satisfied customers. No, no let’s go further together,” Ryane said. Just because there’s “No imminent churn” doesn’t mean there’s “Inherent strength” in your relationship.
A leading indicator for future satisfaction is “Intent to grow”, Ryane said. When customers are open about the problems they have and are bringing you in to help them and discussing further utilization of your solution, that “Is a high health leading indicator,” Ryane finished.
One of the most common reasons for churn is loss of a champion, Jay explained. With the huge rate of turnover most organizations are seeing, it’s even more important to build strong relationships that transcend stakeholders. The value your solution does and can provide should be front and center.
Customer success should be building on current relationships for future expansion. How? By ensuring that customers understand (in their own words) the value your solution provides for them, and how it can continue to do so in the future.
You need to have a mutual understanding of how the customer sees value in your solution: “Engineering a [customer] conversation periodically to explain how they’re experiencing value and what that is,” Kerry explained, is key to understanding the future relationship you’re going to have with a customer.
Kerry went on further, “Customers need to have something strong to say about you.” Otherwise, when a competitor comes along, the door is wide open for them to leave. “The decision maker should be able to articulate how they perceive the value of your solution,” Kerry said.
“They should be able to write down success [with your solution] in their words and make it transferable throughout their organization,” Ryane added to this sentiment. That will make your value much stronger, and long-term.
It’s critical to identify the things that could go wrong and plan together how to prevent issues. Customer success should be performing a “pre mortem” on new customers, Kerry says.
Knowing the “Story you want to be able to tell at the end of the year,” Kerry continued is great, but understanding the bad things that could come up and how to measure those is even better.
Understanding NPS results in real time can help your customer success team build better outcomes both in the now, and in the future.
Ultimately, becoming a leader in lagging indicators requires better understanding of leading indicators and how they contribute to overall objectives.
The goal is to be able to tie your metrics to an objective, make them obtainable for stakeholders, and use them to garner future expansion.
To sum it all up, Christian asked all three webinar participants to add their final thought:
Jay Nathan said about metrics: “Keep it simple: Choose one thing and validate it.”
“Continuously test and learn to grow; you can’t stand still,” Ryane concluded.
And Kerry’s advice? “Don’t accept the metrics you inherited in your role. Ask the question: does this relate to the outcome?”
If you want to listen to the full webinar, you can watch on demand on Planhat. Download it here!