Building a Strong Client Success Program

“The day you sign a client is the day you start losing them.” Don Draper. 1963

Obtaining a new client is a big deal. Companies spend time, money, and other resources to convert leads into relationships and revenue A company might spend months or even years building a relationship in order to win new business. Even worse, it may have been invited to the dreaded RFP, which takes time, resources, and causes anxiety. In many cases, after extensive and intensive negotiations with a procurement department, a company must shift their focus to the vendor management contact and determine how the new relationship will flourish. Once the client is onboarded, how should a company treat them in order to alleviate the stress and relieve the anxiety of the new relationship? A strong client success program can help that company and ALL companies maintain healthy business relationships and provide a platform for future expansion of the business relationship.

Defining Client Success

(From Wikipedia) - “Customer success is the business method ensuring customers achieve success, their desired outcomes while using your product or service. Customer Success is relationship-focused client management, that aligns client and vendor goals for mutually beneficial outcomes.” This is one of the best definitions to be found of “customer success”. In this article, “customer” and “client” will be used synonymously.  

One of the most important aspects of the Wikipedia definition is that success is “relationship-focused”. Building a relationship-focused business partnership is essential for onboarding new clients and keeping them as clients. Relationships can take all forms and are governed by many factors including people, personalities, “history”, ethical standards, vendor guidelines, policies and even government regulations in many cases. Focusing on building the client relationship with all of these factors in mind is key in developing healthy and successful client relationships.

Another key concept here is the focus on “method”, which might even include rigor. That is to say, client relationships are not built on old-fashioned “glad handing” by itself. Client Success can be achieved by implementing and following a methodical process in order to enhance the client experience and provide for mutual benefits such as business growth and healthy business relationships. 

Benefits of a Client Success Program

Many benefits of a client success program exist. They range from the most basic business need known as revenue, to more sustainable needs, such as lengthy relationships. Client Success can lead to three key benefits:

1. Current and Future Revenue:  From the most basic standpoint, without revenue, no real reason exists to provide a product or service. All businesses, even non-profit businesses, cannot exist without revenue from at least one source. A methodical client success program focuses on confirming the relationship in regular intervals and making sure that client revenue targets are met and revenue growth is accelerated.  
2. New Business Opportunities (upsell/cross-sell): If existing clients are pleased with your product or service, they may consider purchasing more services or widgets.. In many industries, a service provider is allocated only a certain percentage of business. A 50/50 split, or some sort of a breakout is not uncommon. Proactively managing the relationship provides a platform to seek additional allocation and opens the door for new services at the same client.    
3. Reduce Client Turnover: In the words of the business legend Don Draper (from the AMC television series Mad Men and pictured above with several team members), “The day you sign a client is the day you start losing them.” Such a cynical approach is not promoted here, but the fact is that clients leave. They leave when they go out of business, they leave when management changes, they leave when your service is no longer needed, and they even leave if they perceive you have misdelivered a service to them. Other businesses are busy trying to steal your clients. Outside of “glad handing”, and even positive service delivery, a client success program should help a company determine when a client is in jeopardy of leaving. The cost to capture a new client is much more than systematically managing existing clients, Thus, ensuring you keep existing clients and providing additional products or services can make the relationship more “sticky” and prevent turnover.

Steps to Establish a Client Success Program

Identifying and documenting Client Success Program steps prior to implementing the program is essential. Establishing a Client Success Program is not overly complicated, but takes strategic and thoughtful planning and can be implemented with these suggested steps:

1. Define “Success”: First and foremost, it is important to define what Client Success looks like for your company AND for your client. Confirm contractual or perceived delivery expectations by determining the client’s end game. Do not forget to document the findings. This will be key in measuring success.
2. Develop a Plan or Roadmap: Most ideas fail without a plan. After success has been defined, “work from right to left” in order to determine how to achieve success. Designate a key stakeholder and task him or her with developing the plan. Make sure that the appropriate resources and executive support are available.      
3. Build a Client Team:  A successful Client Team can start with just one. But that person should be dedicated to client success from onboarding, all the way through operational and recurring service standpoints. Depending on the size of the company and resources available, consider outsourcing client success to a third party. 
4. Purchase a CRM System: A Customer Relationship Management System (CRM) is essential in managing client success. Various CRMs are available and can be accessed as a service. Regardless of the company size, managing contacts, revenue, services/products, upsell/cross sell opportunities with a centralized system provides the tools and data necessary to manage a client from marketing through renewal.  
5. Set KPIs or Any Other Success Metrics:  Establishing how client success is measured can help a company determine whether client goals are being met. Several standard KPIs are listed in the next section. These do not need to be overly complicated and should be added to a dashboard.  
6. Systematically Evaluate: As well as measuring client performance, make sure a method is in place to quickly resolve any issues. Too many months of KPI misses can lead to a miserable client experience, and the client may just choose to terminate the relationship before the performance can be corrected. Measure the KPIs regularly, but do not forget to include qualitative as well as quantitative indicators. Whether measuring the data monthly, quarterly and/or annually, make sure to keep a schedule. Designate a stakeholder group responsible for evaluating performance.  

Client Success Key Performance Indicators (KPIs)

Several suggested client success KPIs are listed below. This is not an all inclusive or required list. Keep in mind that industry specific KPIs can be identified. Whichever KPIs are selected, make sure they are documented and have executive sponsorship and key executive level support. Do not forget to make sure the right method is in place to create the data methodically.

• Client Turnover Rate: Some refer to this as “churn”. It measures the rate of clients that leave each month, quarter or year. This can be a simple calculation based on clients at the beginning of period vs. clients at end of period. Whether or not to net out any client additions is an issue that should be determined based on internal goals.
• Activity Level: This can be measured in a number of ways, key activities and volume expectations must be identified. This indicator focuses on how much of your service the client is actually using during each period.  
• Recurring Revenue: Some refer to this as Monthly Recurring Revenue (MRR), and it is an important measure of client success. If possible, set a baseline based on revenue expectations and measure each month or quarter against the baseline. 
• Referrals: Another quantitative measure that can be used to confirm satisfaction. If a client is likely to promote your business, then specific results should be measurable. It can be based on multiple factors including count, revenue potential and frequency of referrals. A good CRM like PipeDrive (Disclaimer: I am an Affiliate Partner of PipeDrive and this link will take you to their site) can assist with capturing referrals. Client Relations staff (such as an analyst or Client Relations Manager) should be able to accurately dictate this measure.
• Additional Revenue: This measure can be tied to Recurring Revenue. The baseline established is a good place to start. If you expected a client to produce $100,000 in monthly revenue but you receive $107,000, create an action item to determine the reason and identify if more revenue can be achieved.  
• Satisfaction Score: Utilize qualitative as well as quantitative points to determine client satisfaction. In fact, the data points that are listed above can be weighted to help create the overall satisfaction score. Determine the weight of each factor and build it into the dashboard.

Regardless of the size or mission of a company, a successful Client Success Program can lead to a mutually prosperous relationship. First, it is important to understand the benefits of such a program. Once the benefits are understood, developing a methodical approach, measuring and evaluating performance, and correcting KPI “misses” along the way are crucial factors in building healthy and long lasting client relationships.

If you would like a free strategy session to discuss your Client Success Program, please feel free to schedule some time here.

About The Author:

Collin W. Harbour is the Principal Founder of C Harbour Services LLC, a business development transformation and strategy firm that develops strategic plans for sales and client relations management by aligning sales and client plans with company goals, people and process.

Collin is a client growth and business strategy leader with experience identifying new business opportunities, as well as managing and growing client revenues. Collin, through C Harbour Services LLC, focuses on creating customized solutions that deliver valuable services, allowing clients to focus on their core business.