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Majority Of MSPs Are Investing In Customer Success Initiatives: Channel Company Research

Nearly 70 percent of managed service providers surveyed recently by The Channel Company say they have already or plan to establish dedicated customer success teams within their organizations.

A significant percentage of MSPs have been investing in new ways to ensure customer success as they strive to improve their own businesses, according to data from the IPED consulting and research arm of The Channel Company, the parent of CRN.

Bob Skelley, CEO of The Channel Company, during a presentation at the Ingram Micro One conference, said that MSPs are changing how they approach customer success and think about the customer experience.

"[They're] making sure that customers are getting the experience in the deployment that they're expecting," Skelley said.

[Related: The Channel Company CEO Bob Skelley: Public Cloud Is Having A Big Impact On Channel Landscape]

A big recent change in how MSPs approach customer experience has been the implementation of dedicated customer success teams within their organizations, Skelley said. Indeed, he said, a recent IPED survey of MSPs found that over 50 percent have a dedicated customer success team in place.

Having a dedicated customer success team is all about separating the sales process from the customer deployment process and the implementation process, Skelley said.

"They're taking a project that's been sold, a project that's been bought by a customer, and they're putting in a dedicated set of resources on that project to make sure everything goes right," he said. "[They want] to make sure that it gets deployed, to make sure that the business outcome that customer was looking for is realized, and the value that they promised that customer is brought to life for the customer."

About 27 percent of MSPs surveyed told IPED they already had a well-established customer success team and were delivering customer success outcomes, Skelley said. Another 24 percent said that they had just formed such a team, while another 16 percent said that they were planning to launch or implement such a team.

"So that's a really high percentage, almost 70 percent of the partners that we talked to, already thinking about this as a core strategy," he said.

There are three core elements that are critical to a strong customer success strategy, Skelley said.

The first is people, including having a dedicated customer success manager or a customer success specialist, but there are many different approaches, he said.

The second is process, which includes looking at things like customer adoption, expansion and renewals, and how to measure satisfaction for clients, Skelley said.

“When it comes to adoption, are you measuring it against your total customer base for each client?" he said. "[Maybe] Client A's adoption rate is 42 percent, [but] my average is 67 percent. I know I’ve got a big gap to fill from Client A to the rest of my customer base. It gives you metrics and benchmarks to begin looking at so you can measure yourself on performance and be accountable to the customer success that you want to drive for your clients."

The third, Skelley said, revolves around having the kind of data needed to measure customer success.

"Do you have SLAs (Service-Level Agreements) in place?" he said. "Are you looking at net-new projects? Are you compensating your team on net-new projects that they drive out of that customer success relationship? Are you compensating your team on renewals and new subscriptions? Is their compensation program tied to that? And lastly, are you looking at NPS (Net Promoter Score) on a regular basis, at least two times a year, to really understand if you're connecting with your customer?"

Skelley talked on stage with executives from Platte River Networks, a Denver-based MSP, who told their peers about some of the ways they have been investing in customer success initiatives.

David DeCamillis, vice president of sales and marketing at Platte River Networks, said that training has become a critical part of his organization's customer success strategy, including training customers.

For instance, DeCamillis said, every MSP runs into customers who present challenges when it comes to support and who can become irritated because they do not know how to explain an issue or they misread a support ticket.

"So we're now developing a process to actually train our customers on a better way of reaching out and consuming our support model," he said. That's going to be a game-changer, I think. Because if you can reduce the time that it takes to resolve that ticket and get that end user back to work quicker, everyone wins."

Brent Allshouse, Platte River Networks' co-founder and CFO, said it is important for MSPs to take the time to invest in people, and not force people to wear multiple hats.

It can be expensive to hire people when an organization does not feel it is ready to hire, and that results in things like account managers often serving as project managers, Allshouse said.

It can be hard for a small organization to invest in having all the right people, he said.

"But for us, it's actually allowed us to grow pretty significantly in the last year," he said. "I think our MER [management expense ratio] is up almost 33 percent this year over last year, and that is a huge step for us, and a leap of faith. And I think by making that investment and having the right people in the right seats, doing one thing, I think they're going to have better success, and they're going to be able to grow different parts of your business more easily."

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