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Will the enterprise market spend significant IT budget on Windows Vista in 2007?



Are Your Customers Unhappy? Here's Help!

By Morris Panner, Chief Executive Officer, OpenAir, Inc.

Software-as-a-Service (SaaS) provides real-time interaction between application vendor and customer that traditional client server software vendors can only envy. It is one of the key benefits of the SaaS model. In short, the SaaS model aligns vendor and customer incentives and expectations far more effectively than traditional software.

When someone complains about a bug or a frustrating workflow, a SaaS provider can fix it rapidly and then virtually immediately provide the fix to every customer. The first person to find a problem is usually the last.

How can a company take advantage of this business model and turn it into a sustained competitive advantage? I submit that success here hinges on an effective customer support team and the appropriate alignment within the company to take advantage of this real-time feedback loop.

If you look at successful companies across the industry, you will see an inversion in the power structure of the company. New sales are important, but you will see an almost cult-like emphasis on existing customers. Some might say that the previous sentence could characterize any successful company in any industry. At the most superficial level, that is true. Everyone talks the talk of valuing existing customers.

But how many companies would say what I recently heard one successful CEO in the industry say: "If I had to choose between devoting development resources to keeping existing customers happy and making new sales now mind you, I hope I never have to make that choice but if I did, there is no question that I would choose to keep my existing customers happy over making new sales."

What is going on? How many traditional technology companies would really make that choice? Given traditional business models around software and hardware sales, how many really could even imagine being faced with that choice?

An unwavering commitment to customer success must permeate a company culture, but the tip of the spear for this new effort is the customer support department. No longer a sleepy department dedicated to retrieving lost passwords and telling customers that bugs will be fixed in Version 8.2, currently scheduled for October '07. No, the world has changed and the customer support department is leading the way.

Most companies are unprepared for this new role. Few companies are designed to make customer support an integral part of the company workflow. Few companies are willing to make absolutely everything from engineering to sales revolve around customer support. Nevertheless, to be successful, that is exactly what a company should do.

This article will focus on this new role and bring out the following conclusions and recommendations, among others:
  • How do you create a great customer support team? What kinds of talents and capacities are desirable?
  • How do you create the right dynamics between support and the rest of the company (sales, services and engineering) so that the company truly revolves around the customer experience?
  • How does this new customer-centric experience change product development and R&D investment when the existing customer base has such a powerful voice in allocating scarce resources?
How to Create a Great Customer Support Team
The first and most important step to build a great customer support team is to recognize and communicate the fact that customer support is the most important part of the company. That means customer support inquiries need to be treated as a real-time feedback mechanism to be watched as closely as any metric in your company. Here is an easy exercise. Try putting all senior executives on the email distribution list for all customer support requests. Don't expect the executives to be in charge of solving the problem, but watch how it changes the awareness of what is going on in the customer base. Have your senior executives start thinking of themselves as traders (watching the overall health of the market) or politicians (watching the polls to gauge public opinion). The rhythm of the customer support feedback starts to create a real-time feedback loop and helps you answer the question how are we doing? with honest and customer-driven feedback.

Once you do that, everyone will sense a problem long before it has time to develop into something serious. It will start to influence everything you do in the company. You will wake up everyday to an unfiltered referendum of customer opinion.

Along with establishing customer support as the pivot of the company, the next step is to empower the customer support department to make intelligent decisions. We give customer support access to a great deal of our business data. For example, each person in customer support has access to all of the key revenue as well as other metrics about each of our customers. They have access to virtually any detail about our business relationship with a customer. Second, customer support creates the messages that go to our customers about our product. Engineering, product development and marketing channel their messages via customer support. This ensures that we are not promising something that customer support either doesn't understand or can't explain.

Once you have set up the right processes and conditions for success, the next step is to hire the right people. One thing you may have noticed. I didn't say hire and then set up the right processes. I said the opposite. It is very hard to hire great people and expect them to success without enabling their success. That is why it is so important to have the right processes and conditions in place. Once you do, hiring is still a massive challenge. You are looking more for a type of person than a particular set of qualifications. Remember a lot of what made a great customer service representative in the past stonewalling clients just won't work in the new environment. Think of the advertisements for Capital One Credit cards and you can start to get the picture of what many former client server software customer service reps had to do. It was the way the business worked. It had to. There was just no way to rapidly and cheaply fix a customer's problem.

Now with SaaS changing that dynamic, you need to look for people who are willing to engage customers and solve their problems. We have actually changed our titles from "Customer Support" to "Customer and Application Support" to reflect the fact that our support representatives had to solve customer business process problems as well as provide standard customer support. All of this makes the hiring process challenging. Like so much in SaaS, we are breaking the mold and creating a new path in so much of what we do.

How to Create a Customer-Focused Company
Putting the right process and people in place is all for naught, unless the company changes. A company has to create and foster a dynamic between support and the rest of the company (sales, services and engineering) so that everything truly revolves around the customer experience. A strong customer support team will drive toward that outcome, but it can't do it alone. Moreover, it will require great effort on the part of the customer support team and the appropriate attitude in dealing with the rest of the company. There is an old saying that with great power comes great responsibility and that is particularly true for the customer support organization in the customer-focused company.

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