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CX Insights

CX Insights Episode 7: Trust the Customer Success process

“Learn from others in the customer success community and catch nuggets of brilliance from their experiences”

It was fantastic to host Phil Gravel, VP of Professional Services & Customer Success at Prophix Software on the latest episode of CX Insights.

Phil shares some amazing insights around
1. Leading Professional Services in a Software company
2. Monetizing Customer Success
3. Customer Onboarding
4. and much, much more

Transcript

Welcome to the show. Our guest for today’s episode is Phil Gravel. Phil is the Vice President of Professional Services and Customer Success at Prophix Software.

Phil, Welcome to the show. Thanks, Abhijeet. Good to chat with you. Likewise. Hey, tell us a little bit about yourself, Phil. Yeah. So, as you mentioned, I’m the VP of Professional Services and Customer Success at Prophix Software.

I’ve been with the company for a little over eight years now and come from a finance background and a consulting background. To be frank, I dove into the world of customer success about six years ago and had sort of enjoyed kind of leading the efforts on building our program, profits and, you know, and connecting with others in the field and really.

Learning a whole lot about what customer success is all about. So I’m excited to be here and kind of share what I’ve learned over these past six years with you. Awesome. And, Prophix is, are you guys looking at sort of the financial function for a lot of customers? Tell us a little bit about profits.

Sure. Yeah, we’re what you call corporate performance management software. So we’re in the space CPM; some call it EPM enterprise performance management. So really, to kind of distill it down, to make it easy to understand for the listeners. We do the report. So a lot of ERP software vendors don’t have robust reporting capabilities.

So we’re a, you know, we connect into the ERP and offer a flexible reporting tool. And then our bread and butter are around planning. So we’re kind of a multi-user—a budgeting and forecasting application. We automate many things that companies struggle with in terms of preparing their budget for multi, multiple multi-user participation, you know, building the Excel spreadsheets and sending them out and collecting them and consolidating them.

Prophix is an application that helps with all of those functions and then, you know, kind of, to kind of round out the solutions that we also offer a dashboard and capabilities to see your data in those pretty visuals well as financial consolidation. Yeah. That makes sense.

And you guys are handling a lot of critically sensitive data for your customers. And, are you guys doing that across, like customer segments? Do you guys have a large enterprise, mid-market SMB, or are you guys focused on some particular segments there? Yeah, I would say kind of our sweet spot.

You know, in terms of companies who have these sort of departments set up this way, where they have multiple users and a lot of collaboration across the budget, budget process and planning processes, et cetera, are in kind of the upper mid-market. So we often say we’re in the mid-markets, companies within kind of the 500 million to one or two billion or annual revenues is our sweet spot. That’s where a majority of our customers are from. We can also, you know, have customers in the sort of upper enterprise space and the lower mid-market. Got it. Okay. And do you guys like to focus on critical industries, or is it across the spectrum?

Like manufacturing, tech, healthcare, etcetera? We have hundreds of customers and almost every industry. We haven’t; we have historically worked with any company from any sector because our software is relatively flexible to use from that standpoint. We have partnered with some key kind of construction ERP vendors over the past couple of years and have found an issue there, but.

We continue to serve as the general CPM space in general. Yeah. As you look at your customers and you’ve been with, Prophix for some time, and you’ve seen the evolution of customer success and lead professional services, how have you guys been scaling customer success in the sense that have you guys built a ton of automation?

Around this, like how have you considered scaling? And what’s been the sort of the thought process of scaling customer success? Yeah. So customer success didn’t exist formally, about five years ago or six years ago at Prophix. And, we kind of. Like many, many companies who have been, who have a longer-term, have been around long term.

We had an on-prem, we have an on-prem product and, and we still have, you know, a significant amount of customers who are on that particular solution. And then, we transitioned into offering a cloud version about five years ago. And so we saw the writing on the wall in terms of needing to build up the customer success program.

In terms of kind of to answer your question around scaling, you know, what we decided to do in the early days of the customer success program was started—trying to gather and collect customer intelligence. And so, because we were, at that time, predominantly an on-prem product, it was hard to get customer intelligence.

So we started kind of, you know, modifying how we do reach outs and surveys. And what types of, what types of, what. Types of systems we use to collect data during, you know, conversations, phone conversations at conferences, during customer events, those kinds of things. And how do we store that information?

How do we use that information to help us understand, you know, what makes our product sticky? How do we better engage with customers? How do we increase adoption, those kinds of things, what type of programs we need to put in place to, You know, ensure that our customers are successful. To kind of renew year after year, they continue to, you know, it was in a way it was more comfortable in the on-prem world because you make that significant investment upfront and then to pay the annual maintenance fees.

It’s, you know, a very low percentage of the overall spend. And so, you know, it was. Easy. And our customers were loyal. We have an excellent customer base who are very reliable. And then in the cloud world, that’s a little bit different, right. So you always have to demonstrate value. And so, you know, early days it was, it was a lot of that.

And then, as we’ve progressed, we’ve added headcount. We’ve invested in technology to help us, with the CS platform and advocacy platform and a few other tools that have helped us scale. And then we’re always kind of reinventing how we segment our customers. What type of approach we take, who, what.

How do we tier the customer base regarding who gets a dedicated CSM versus who may benefit from tech touch-type, reach outs, etcetera? So, very cool. And so it sounds like you’ve been; your team has been through quite the journey in terms of going from an on-prem to a SAS, a multi-tenant model cloud-delivered, et cetera.

And with that comes its own set of challenges to scale up and automate and put the right platforms in place. Right. And so it sounds like, so tell us a little bit about the platforms which put in place, maybe any of the CS platforms. And also, what type of integrations have you done? Are you guys integrating with your CRM?

Have you guys run some sort of integrations around product analytics? We’re pulling in product analytics into your customer success stack; tell us kind of, how was all of that working? Yeah, that’s been a long journey for sure. One of the things we did, I think you, you, and I have had conversations on that snip pass, but you know, customer success is often underappreciated in terms of, you know, how do you funding, etcetera.

Early on, one of the things we had to do was, you allocate resources accordingly. And, and because of our software, as I mentioned, our software is quite flexible. We were able to use our software at the beginning to consolidate all the information that we were pulling out of our CRM and out of our other applications, our support application, as an example, but even our marketing automation, and we didn’t have a ton of customers on the cloud, on the SAS, offering yet.

The usage data at that time wasn’t that relevant because we were focusing a lot of our efforts on the on-prem customer base. So it was more about actually putting all of the information in a single place and then using that to kind of identify or highlight any type of churn risks or anything like that.

And so we did that for a little while. It was better than, you know, using spreadsheets and better than, you know, actually asking our CSMs to go into ten different platforms before they have a call with our customers or before they have a reach out. Yeah, absolutely. Ten other places pull the information.

Yeah. What support tickets you have? How many do you have? What are the outstanding issues? You know, how are you? Are you actually, you know, opening the emails that we’re sending you on some of the educational content we offer and et cetera, etcetera. Right? So doing that using profits to do that was helpful, but it’s not ours.

You know, it’s not our sweet spot. Right. I mentioned kind of what our software is good at. We did finally invest in a CS platform when it when we had, I think, more customers in the SAS offering. The usage data became even more critical and, you know, compiling the two sets of data together to then.

Even kind of automate some of the reach-out efforts. Right? So, we invested insurance zero as a platform, and it’s helped the CSMs; you know, from a scaling standpoint, it was a suitable, sound investment. We, we good investment. We’ve rolled it out. We’ve been kind of using it for the past eight months or so.

And I’ve found some significant benefits in being able to do that and being able to target and focus efforts from RCS, team, and kind of standardizing what approach you take when certain risks do get flagged, et cetera. Yeah. So it sounds like you’ve, transitioned from using, you know, profits for some of this and then.

As you guys got into the cloud, he looked at deploying the CS platform and then connecting it with the product telemetry and pulling in all these data sets in your CS. Tech. Is there an uncommon tool? Like something that you don’t know if many people are using, but you’re using that in your stack.

Is there, are there tools like that? Yeah, I’m not sure how prevalent this is, but we use an advocacy platform as well. So one of the things we invested in about three years ago was a kind of a rewards program where if customers, Three to four, four years ago, we would reward our customers for their loyalty and for doing things like case studies with our marketing team, or, you know, participating in reference calls or offering referrals, those kinds of things.

And. We wanted to expand that. And so we invested in, with, a company called Inflictive to build out an advocacy platform called their red carpet program. And so now we have thousands of customers who are in this platform and. We’re able to do a lot more than just, you know, do case studies, reference calls, and referrals.

Now we’re able to put content in there that helps our customers, you know, get more value out of their investment with us. Learn about the unique uses of the software connect with other customers. We have a thriving community where customers can touch and similar industries and similar geographic locations, which is even more critical than these times because you can’t meet in person, or it’s much harder to meet.

And so. Yeah, it’s been; it’s been highly successful. And I think it’s just to kind of a value add a component of what we offer from a success standpoint to our customers. And a lot of companies will have that sort of tool, or that function relies on marketing, and we have kept it in customer success because we think it’s a customer success first application, in a lot of ways.

So maybe different than a lot of the listeners today. Yeah. I think it’s super interesting. And I love that angle that you guys are taken and to deploy a customer advocacy tool. I frankly, you know, pay for itself many times over just because you can drive a lot of customer references. Quite frankly, it also helps you build your company’s brand trustworthy 360 around your CX.

That’s super cool. One of the things we talked about in the past was, around, sort of taking the next step in the CS journey around monetization, and, you know, it’s an often hotly debated topic in customer success circles. Like there’s always this camp of saying, Hey, let’s talk, monetize customer success.

We are all about creating value for the customer. There’s another camp about, Hey, we should monetize. And it sets up the right sort of are the operating model within the company for customer success. And you know, there’s no right or wrong answer here, but just interesting. This tells us sort of kind of what led you to the path of choosing this? Why did you choose? Monetizing customer success. And then, you know, I would love to kind of chat about it a little bit. Yeah. That’s a great, a great topic. And like you said, it’s hotly debated and, you can, kind of see arguments on both sides.

I’ll tell you why we went that route, and hopefully, it’ll help some of the listeners. One of the reasons is I didn’t mention this, but we’re. You know, we’re a self-funded organization. So every dollar spent reinvested into the business gets scrutinized and, and there is a decision to be made on how it gets spent.

Right. Do we spend it on research and innovation? Do we spend it on sales and marketing? Do we spend it on customer success? Right. So you’re always kind of battling that and. One way you can get those investments is to turn yourself in from a cost centre into a profit centre.

Right. So that was, that was part of the decision-making process. Early on, I connected with a lot of peers and did a lot of attending webinars and reading on customer success. When I went from a kind of finance world into the customer success world, I heard I had an event somewhere you should not.

I feel bad about charging for the service that you provide. And so, if you think back to kind of professional services, years and years ago, there may have been stigma and charging for that. And now, it’s no question customers see the value in consulting and getting the right skill set and experience to help you implement software or get helped on other fronts.

And so it’s, it’s no different in my opinion, from a customer success standpoint. So. It was to help with funding. And I, I didn’t, I thought it was, you know, I thought it was essential to do this because I believe there is the customer profile out there who does already see the value in these types of offerings and, and who can, You know, I appreciate it and would gladly pay for it.

So what we did is, as I was talking about collecting data elements and figuring out why customers were turning, when they were turning, et cetera, we realized there were some key themes that we found, right? So customers were engaged with us. They were, you know, doing some of our online training or in-person training if they were attending our conferences or events that we would hold if they were doing consulting engagements, you know, frequently So they were, building upon the initial project that they had with us and building on their vision. Those were recipes for success. And, and so what we tried to do is build out a subscription offering that kind of gave customers the ability to do all of these things using their subscription.

And so it became, you know, it was like we offered, an annual subscription or a monthly subscription to a service that gave you all of these things. And some comp customers value a particular element of it. Other customers value and other factors, we know that if customers, we, we priced it. Accordingly, because we want our customers to adopt the program because we know it’s a, it’s a leading indicator of future success with us.

We didn’t price it too high because we wanted as many customers to jump on board with this. And we, you know, it’s been wildly successful. So not only has, have we seen, you know, almost 85, 90% uptick from our, customers kind of taking this program. It’s a differentiator for us in our space.

A lot of our competitors don’t offer this type of program. Customers do see the right value upfront. It becomes a differentiator in the sales cycle. So customers love the fact that. atThis is even available. They know that we’re thinking about them, you know, beyond the services engagement. And, you know, the participation in the program has been high as well.

So we found, you know, it’s been tremendously successful. We have a significant portion of our customer base that, you know, continues to leverage this program today. So that’s super cool. And so, do you, do you like, is the. Service a packaging of different types of these, you know, services together in a single law for, so it sounds like there’s some analytics there, there are some advisory services. There’s taking care of the customer and key sort of areas that they’re working on, whether it’s FP and a, and other, maybe reporting and other places.

And as you, as you created this packaging, And you started offering the customers. What happens in the sales cycle? Like, do this, your sales team does your sales team go out to the customer and say, Hey, here’s our, let’s say, this is our software. This our SAS offering. And oh, by the way, would you like, is it almost like, would you like to have fries with that?

Or is it more like, oh, you know what, and this is something that will create value for you. Is it sold alongside the product or? Is it sold after the product sold? Like you come in and say, okay, you know what? You bought the product with us now, you know, you guys should consider getting this customer success offer.

How does that sort of motion work for your company? Yeah, it’s a bit of both. So because we had that large customer base that had been with us for, for an extended period, we did go into, you know, and, and offer this to the customer base as an alternative to in cases where they wanted to, you know, potentially invest in a project services project.

We offered this as an alternative if they were willing and, and there are, you know, rules and guidelines around how you use the service. It comes with a dedicated CSM as well. And, you know, they guide our customers through what’s available and continue to drive value on using the program.

But it’s actually. You’ve been incredibly successful with net new customers. So, you know, when you, when we do sell the software as I said, one of the things we do is if customers are willing to subscribe to the program, and we typically sell three-year subscriptions, but we offer a one-year subscription on, on the customer success program.

Partly because we know that the first year is so vital for our customers to on-board successfully and make sure they’re getting the value and feeling comfortable through the go-live phase. But we’ve found that customers see the matter, you know and, and continue to subscribe.

But most customers, net new, really appreciate the fact that it’s an option and, you know, most like 85, 90% of customers take us up on the offer and then actually sign up for it. Rolling. And you know, it’s great. It’s a win-win when a customer gets more value out of your software; they’re super happy with it.

Your customer success team has the right P and L and. You know, it’s a more sustainable business model. Then your product teams are happier, and your sales teams are more comfortable because they’re taking care of the customer and their stickiness. They’re even more sticking than on top of the product. So it’s great.

It’s a win-win, you know, let me, let me go back a little bit, and talk some of your learnings, and you’ve been with Prophix for some time. So what are some of, like, give me an example of the most, and let’s say the difficult thing that you had to learn or the most challenging thing, or the thing that you would ask yourself, like, why are customers doing that?

Like, why are they behaving this way? Or like something so difficult to sort of understand, but eventually, of course, he got over it, or your team got over it, and you were successful. Give us a quick example of that. I think the most challenging part, and it’s, you know, there hasn’t, we haven’t wrapped it, wrapped it up.

I would say at this point, but I think it’s trusting in the process, and so, I liken this to playing golf offense, if any less than I was.

It’s like you do all of these things, things, and it requires you to pay attention to the little things. And, you know, you could kind of be out there on a, you know, in a golf round and. be playing as well as possible. Suddenly, you have a challenging hole because you struggled with the little things, and it’s a bit of a setback for you.

But if you kind of routinely put effort into those little things and continue to refine and improve them, then you start, you have these wins, and you have those moments of glory like you would on the golf course from time to time. And, they keep you going. And so really just trusting in the process and, you know, I think.

You kind of want it, like when we first started with the customer success program, I have this vision of where we would be three or four years down the road, and I want it to be there in year one. It’s impossible to do so because there are so many other elements that require, you know, that I need to be in place to do customer success successfully.

You, I think when you first kind of get into the field, you believe you are responsible for customer success, but you slowly start to realize that it’s not a single department function. It’s a—organization-wide philosophy and thought process. And so, you know, just kind of checking myself at times of difficulties and wondering if we’re doing the right things and, you know, wanting to accelerate certain things faster and faster.

And then, yeah, that’s probably been the most challenging part, I would say. Oh, very cool, man.  I love the analogy, the golf analogy, and absolutely this is trusting the process and. It is working through that and making investments every day and learning. Agree. As we wrap up this episode, Phil, this has been tremendously helpful.

If you were to share, share one piece of advice with the listener, what would that be? Yeah. Other than trusting in the process, which I just mentioned, I think is, is supercritical because you will get those outcomes, and you will see the benefits of doing those little things right—and continuing to improve.

But I would say one other important aspect is don’t be afraid to learn from others in this space. So customer success is a relatively new field and. There are so many people out there who have the experience, who do things a certain way, because you know, the service or product they offer, but they have nuggets of brilliance that they can share with you.

And I found the customer community is beneficial and forthcoming with sharing information. And it’s, you know, essential that you do that because if you try to solve these problems on your own without actually having conversations with peers, you know, in different industries and similar industries, et cetera. Then I think you’re going to fall flat on your face. That is one of these places where you want to do, check, validate whether the things you’re doing are, you know, the right things, learn on something that you can do to evolve the program.

And, that goes. Beyond just connecting with peers, but attending webinars and reading books helps you evolve as a real customer success professional. It’s essential.

I love it. Phil, reliable advice, network with others, learn from others.

Keep learning, iterate. Fail for folks who follow you; what’s the best way for them to do that? Twitter, LinkedIn, where do you? I don’t post a lot on Twitter, but you can find me on LinkedIn, Phil Gravel at Prophix Software in Toronto, Ontario.

Outstanding, Phil. It was tremendous to have you on the show. Thank you so much. Thank you, Abhijeet. Have a great day.