How Employee Success Leads to Customer Success: An Interview with ESG CEO Michael Harnum

June 15, 2022

Marley Wagner

Category: Customer Experience, Customer Retention, Customer Success as a Service, Customer Success Maturity, Customer Success Strategy

I’ve talked before about how internal engagement can help promote strong Customer Success. Here at ESG, we believe that employee success is not only helpful to a healthy and thriving Customer Success organization, it’s fundamental. Since the pandemic, employee satisfaction and retention are major focal points for businesses across the board. We expect to see more companies investing in their workforce as The Great Resignation continues.

Human capital management is a key element of Customer Success maturity and something to pay close attention to as you build and scale your CS team. One of our recent webinars tackles the topic of nurturing employee success in Customer Success. Now, it’s time to put our money where our mouth is and look at how we practice what we preach at ESG. So, I sat down with our CEO, Michael Harnum, to talk about how he promotes this employee-first philosophy and how the principles of employee success are intimately tied into the principles of strong Customer Success.

Marley Wagner (MW): I’m excited to chat with you about this topic that I know is near and dear to us both – how employee success leads to Customer Success. So, let’s start with the connection between those two concepts. What do you think is the link between employee success and CS?

Michael Harnum (MH): I think there are a couple of logical connection points between those two topics and some pretty strong connective tissue that binds them. The first thing that comes to mind is that Customer Success is a relatively immature marketplace. It’s very dynamic and growing and changing really fast. And there are roles and needs and functions that a new industry creates that didn’t exist a couple years ago. Half the people we have at ESG have titles that we never even contemplated three years ago. So, it’s a very progressive market. Customer Success is most prominent inside of SaaS companies with really progressive thinkers and leaders that are pushing it forward. As those boundaries get pushed, it creates the need for those new roles, but then it also creates a reconciliation process between employees’ existing skill sets and what those new needs are.

MW: Because Customer Success is so new, it’s always evolving and creating new opportunities for employees.

MH: Yes, and I’ve always found that professional development thinking and planning is more fully embraced by employees who can see where things are going. They think, “That seems like a really cool thing. I would like to go do that. I know that I’ve got maybe 80% of the skills and I have to fill in that other 20%.” Let’s build a plan and fill in that 20% gap so that I can do that new thing. When those ingredients exist, I think employees really engage in the professional development process. In Customer Success, those opportunities abound.

MW: So, when companies are building out their CS capabilities, they can extend these professional development opportunities to their current employees.

MH: Yeah, I think that’s true. And then, a lot of people are hired into a garden variety title, like Customer Success Manager. But, as we begin to do things, we discover that some of the work is CSM-specific, but a lot of the work is maybe something else. Then you can have a discussion with the employee. Let them know the role is heading in this other direction. Ask them, is that the direction you want to go? Do you have the skills to get there? How can we support you? Is that exciting to you? If not, then we probably need to make a change.

I think that would be the first area of connection between employee success and Customer Success. It really adds life and spark to a professional development plan because it can lead to more opportunities in pretty short order. I don’t think all industries can say that.

MW: And by thinking about your employees and being flexible with them as you build your organization, you are eventually getting to the point where you’re thinking about your customers’ success too. One leads into the other.

MH: Yes, and I think the other way that happens is just the acknowledgement and recognition, right? Acknowledge and recognize that your Customer Success Managers are taking care of your customers. It sounds kind of obvious and basic, but there are a lot of companies that say, we’re customer-obsessed. We’re customer-first. You know, at ESG, we intentionally take a different position on that. Obviously, we need customers. You don’t have a company without customers, but we fashion ourselves as an employee-first organization. Our philosophy is that, if you hire really good, talented people and you enable them, you get out of their way, then they’re going to take world-class care of your customers. That’s the symbiotic relationship between employees and customers.

MW: What are some of the ways you think an employee-first philosophy is different from a customer-first philosophy?

MH: That manifests in a million different ways. The flexibility you give your employees. The training and confidence you give them through knowledge and certifications and a variety of formal and informal learning opportunities. The ability you give your employees to work on different projects, some of which might be outside their comfort zone so they’re challenged and they grow. The way you treat them. The way you interact with them. All that really matters in terms of satisfied and engaged employees. I’ve never seen a company that has really happy and thrilled customers and miserable employees.

MW: So true!

MH: And that’s not a declaration of perfection. I have meetings each week with employees. I had a couple this week who told me, “You say that you’re employee-first, but here’s been my experience and it doesn’t add up. Can we talk about it?” And, to me, that’s really encouraging, right? Because you have to have that type of culture where people are going to call you out and ask questions if things don’t feel right. And we can talk through that. So, we’re not perfect, but we try to get better at how we treat our employees each and every day so they can take world-class care of our customers.

MW: Those conversations are especially relevant right now with everyone talking about The Great Resignation and having trouble hiring talent. It even sounds similar to a lot of Customer Success conversations around retaining their customers. Maybe that philosophy of advocating for our customers should carry over to the employee side too.

MH: I haven’t looked at the data on this, but there’s got to be an undeniable correlation between employee turnover and customer turnover.

MW: Absolutely. I’d love to see a report on it.

MH: We’ve been fortunate that our employee turnover has been super low. I think some of that is due to the way we operate.

MW: Can you describe some of the policies we have in place that you think help with that? That make ESG an employee-first organization?

MH: I think the foundation of it all is treating people with common courtesy and mutual respect. In almost any point of friction, that principle has been violated somewhere by someone. That’s a starting point. One layer up from that is the belief that people who enjoy their jobs are going to stay in their jobs and flourish. Generally speaking, those are also people who are challenged by their jobs. I think boredom is probably one of the biggest reasons people leave a company. They’re just not challenged anymore. They’re not learning new skills. They’re not growing as a person. Knowing that and having an environment where we’re onboarding new customers all the time really keeps everyone engaged. There are always new opportunities to grow.

MW: You mentioned having meetings with employees. I know you do that regularly, which in my estimation isn’t all that common for a CEO. Can you talk more about that?

MH: You know, probably a good third of my week is taken up with one-on-ones. I don’t get to meet with every employee every week. We’ve grown to a point where that’s just not practical, but we’ve also put a leadership team in place that is really capable of doing that too. I think staying connected with folks helps reinforce what we believe in. We do what we can to make real connections with our growing team. We have a monthly internal newsletter that goes out that I record a video for and we do a monthly all-hands meeting that’s taken on a life of its own with a bunch of different speakers. They’ve become really fun sessions for all of us. We’ve got our own webinar series now where people can see how we interact. So, there’s a bunch of ways that we communicate. It’s basic stuff, chatting on Zoom, video calls, ways we’ve all figured out to close the gap of distance between people a little bit.

MW: I think closing that human-to-human gap is something everyone is really yearning for after two years of primarily remote work. Can you talk more about how you think through cultivating relationships regardless of the physical distance?

MH: You have to find a way to make it relevant. I mean, everyone has sat through stale one-on-ones with their manager that they did just because it was on the schedule. So, how do we continue to breathe life into that relationship? That’s really the challenge. I think that challenge exists with employees and with customers. I mean, I can schedule a Quarterly Business Review with you, or I can send it to you via email.  But if it doesn’t show you something you didn’t already know and it’s not compelling and meaningful to you, it becomes an academic exercise and you’ve actually gone backwards in your relationship.

MW: In a lot of ways, nurturing a relationship with your employees is a lot like nurturing a relationship with your customers.

MH: Absolutely, and it’s all about engagement. Engagement applies to both employees and customers. If you see a disengaged customer, obviously that’s not a good sign. Same for employees. So, what are the strategies that you use to re-engage with a customer? You’re going to try to communicate with them. You’re going to try to be relevant to them. You’re going to try to understand what their needs are. All of those things add value to the relationship in a specific way. Those strategies are all the same.