The First 3 Things You Need to Start Your Customer Success Center of Excellence

October 21, 2021

Marley Wagner

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

While Centers of Excellence (CoEs) have been popular drivers of improvement in organizations like Marketing, HR, and IT, they haven’t quite caught on in Customer Success (yet). We believe that’s about to change. Our recent webinar focused on the topic of CoEs in CS, where we learned how some industry leaders have already begun reaping the benefits of their own CS CoEs.

So, what is a CS CoE?

A Center of Excellence is the pillar around which strategic, operational capabilities are formed, enhanced, and dispersed to the larger organization. A Customer Success CoE centralizes the knowledge and expertise of CS and distributes it across the enterprise. Its primary purpose is to amplify the influence and incredible capabilities of Customer Success to ultimately perfect end-to-end customer lifecycle management for everyone. While a CS CoE shares many similarities with a CS Operations team, its differentiator is that it acts as a sort of umbrella organization over all customer delivery teams to collect best practices and processes, iterate upon them to near-perfection, and then roll them out organization-wide. The programs and processes a CS CoE develops then become the guidelines for all service delivery and customer-facing teams.

In PwC’s latest annual CEO survey, 36% of CEOs said they are focusing more on productivity through automation and technology – up 124% compared to 2016. Gartner recommends setting up CoEs to maximize the value organizations can derive from the power of artificial intelligence. And McKinsey & Company advocated for utilizing the CoE model to drive advanced analytics transformations back in 2018. Businesses are recognizing the need for data-driven innovation and enhanced operational capabilities, and a CS Center of Excellence can fill this need by maximizing your organization’s potential for operational excellence.

What you’ll need to start your own Customer Success Center of Excellence

If you’re interested in exploring whether a CS CoE is right for your organization, check out our deep dive on the topic. If you’re already in the driver’s seat and ready to start building a CS CoE of your very own, you might be wondering where to begin. There are many factors that go into forming a Center of Excellence, but we’ve boiled it down to the first three things that are the most critical to build (and get right) in the early days of adopting your new structure.

1. A charter for your CS CoE

Defining the goals and priorities of your new CoE is a critical first step. Defining a charter will help you take that step (and then some) by serving as the north star for designing your team, its scope, its objectives, and other crucial details about its role and how it will eventually function – things that can easily trip you up later on if you don’t put them down on paper from the get-go. Similar to creating a Customer Success project charter, your CoE’s charter will become the blueprint you’ll use to design and measure the new initiative. It can also help you get back on track if you ever start to veer off course. Given that one of the primary reasons to build a CS CoE in the first place is to manage change across the enterprise (like when a large technology business transforms from legacy on-prem to XaaS, for example), having the level of documentation and accountability that a charter provides can be immensely beneficial.

A charter is also a great tool for gaining executive buy-in for your CoE and giving stakeholders a sense of ownership in its creation. The charter enforces a sense of accountability, and it communicates a value proposition to your company leaders in a concise and actionable manner, so they’ll be more likely to support its implementation.

2. A Customer Success Operations Manager

Every new initiative needs someone responsible for making it “go,” and for a CS CoE, that someone is the Customer Success Operations Manager. The CS Ops Manager is the leading player for building and optimizing processes and workflows, delivering new capabilities within the CoE. They are responsible for managing change up and down your CS delivery teams. Effective CS Ops Managers will evaluate every detail of your current processes, engineer creative solutions to fix any bottlenecks or breakdowns that impede CSMs from delivering the best-in-class experience they are known for, and develop new ways of working to make everyone around them even more efficient and effective. It’s best to think of the CS Ops Manager as a “force multiplier” within the CoE; they clear obstacles and level up the organization so that each and every member of the team is delivering with maximum impact.

The best CS Ops Managers have a healthy mix of the “hard” and “soft” skills necessary to lead CS Operations within a CoE. They should be technically-minded and familiar with best-of-breed technologies like CS platforms and CRMs, sales enablement tools, dashboards, and data analytics. Well-developed interpersonal and organizational skills help the CS Ops Manager establish trust across teams to understand and align projects to varying stakeholder pain points and priorities.

3. Data and analytics

The best decisions made in Customer Success are those that are driven and supported by data. Business Intelligence (BI) or Data Analysts supporting the CS CoE can use that data to enable leaders in establishing key performance metrics, thus ensuring a focus on measurable outcomes that have the most definitive, provable impacts on customer value and retention.

Data doesn’t lie, and it tells an important story about the state of your customers as your organization matures and transforms into the CoE model. You’ll want to track and report on both leading and lagging indicators before, during, and after implementing a CS CoE.

Monitoring leading metrics like customer engagement with newly rolled out customer-facing content or touchpoints enables both quick wins (to demonstrate what’s working) and the ability to rapidly pivot or iterate on those things that may not have panned out exactly as you planned. Other leading indicators like product usage, number of support tickets, or transactional survey data (like NPS or CSAT scores after a support interaction) can also help validate the impact of the CoE – without having to wait until renewal time rolls around.

But when renewal time does roll around, that simply means there’s a whole new set of data points to help evaluate the CoE’s effectiveness and inform what they should be tackling next – the lagging indicators I mentioned earlier. These are also the metrics that executives care most about, so they’re the ones that the CoE should really be trying to impact in the long-term. Things like Churn Rate, Expansion Rate, Gross Revenue Retention (GRR), and Net Revenue Retention (NRR) are the ultimate metrics that every CS professional is trying to improve, and the CS CoE is no exception.

I’m thrilled to see more and more organizations begin to recognize the benefits of implementing a Customer Success Center of Excellence model! As brave CS pros continue to pioneer new ways to manage significant shifts within customer delivery organizations while focusing on data-driven insights and new capabilities, CoEs have the potential to become the new standard in CS. Want to be one of those pioneers? Read more about determining if a CS CoE is right for your organization.