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How Customer Success is Revolutionizing Open Source Companies

As companies demand more of technology, it’s no wonder why they turn to open source to help fill the gaps. Likewise, it’s not surprising that open source companies would turn to customer success to support these clients.

Join Jennifer Dearman, Director, Strategic Customer Engagement at Red Hat, Andy Knosp, VP of Services at Gainsight, and Dhaval Moogimane, Partner at Waterstone Management Group, to discover how customer success is revolutionizing the open source industry. In this 60 minute webinar we will discuss:

Why open source companies are adopting customer success
How to implement customer success in an open source company
Real-world examples of how Red Hat implemented customer success

How Customer Success is Revolutionizing Open Source Companies

  1. 1. Child-like Joy ©2015 Gainsight. All Rights Reserved. How Customer Success is Revolutionizing Open Source Companies
  2. 2. Child-like Joy ©2015 Gainsight. All Rights Reserved. How to Win in Open Source with Customer Success Dhaval Moogimane Partner, Waterstone Management Group
  3. 3. Objectives •Why Customer Success is important for open source software companies •How open source software companies can get started and maximize the value of Customer Success
  4. 4. Challenges for open source companies Competition with Free & Proprietary A.Convince “free” users to convert to paid open source support B.Convert proprietary users to premium open source C.Justify pricing at each renewal 1 Customer Value in Long Tail A. Manage customers in the long tail via existing resources B. Identify opportunities for cross-sell and upsell within existing base 3 Heavy Reliance on Subscription A. Deliver fast time to value B. Focus on renewals 2 These 3 factors drive challenges in customer retention, conversion, and upsell / cross-sell for open source companies
  5. 5. Why Customer Success is important for open source 1. Competition with free & proprietary 2. Heavy reliance on subscription 3. Customer value primarily in long tail Open Source Challenges Customer Success Outcomes Relentless focus on Customer Success and Experience to Drive ARR Conversion to paid for premium offerings Cross-sell Upsell Retention
  6. 6. • Improved retention rate attributable to CSM • Qualified leads passed to sales (license, education, success, services, etc.) • Direct signing on success, services, or education offerings • Conversion to paid-for premium offerings • Increased sales efficiency • Improved sales retention • Reduced support org costs • Reduced CAC Economic impact of Customer Success for open source Illustrative CSM org profitability B C DA
  7. 7. How to get started 5 actions that open source companies should take when establishing Customer Success capability Make Customer Success an organizational priority Align organization on CS and formalize review of customer health metrics Charter a Customer Success team Establish team to monitor customer usage and health, and drive net renewals Find the right talent Identify CSMs that can engage with users during key point in lifecycle to gauge usage, assess risk, and prompt adoption Understand your customer Gather product usage insight via available indicators Exploit the long tail Invest in technology and design CS model with automation in mind 1 2 3 4 5 1 2 3 4 5
  8. 8. Child-like Joy ©2015 Gainsight. All Rights Reserved. How to Implement Customer Success at an Open Source Organization Andy Knosp Vice President of Services Gainsight
  9. 9. 5 Pillars of Customer Success
  10. 10. Demonstrate the value you deliver to your customers to promote adoption, advocacy, and growth DEMONSTRATE Value 5 Pillars of Customer Success Build a consistent, effective customer journey through one-to-many strategies and high-impact, timely one-on-one interactions OPERATIONALIZE Customer Lifecycle Build a customer-focused organization by improving cross-functional coordination and measuring impact ENABLE Cross-functional Visibility Make it easy to spot and act on opportunities for growth and candidates for advocacy DRIVE Expansion & Advocacy Proactively identify signs of customer risk and collaborate cross-functionally to address issues MANAGE Customer Risk
  11. 11. ©2015 Gainsight. All Rights Reserved. Business Challenges 1. We have accounts we can’t touch with manual outreach but need proactive attention 2. We are seeing customer satisfaction issues due to poor hand-offs from sales to CSM 3. We spend too much time preparing for Executive Business Reviews 4. CSMs have too many repetitive interactions with customers 5. It takes customer-facing team members too long to prepare for customer meetings 6. We need to increase the ratio of accounts a CSM can handle to make CSM more cost effective OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DEMONSTRATE Value DRIVE Expansion & Advocacy ENABLE Cross-Functional Visibility 5 Pillars of Customer Success
  12. 12. ©2015 Gainsight. All Rights Reserved. Business Challenges 1. We don’t know which accounts are at risk, and which we can impact or de-prioritize 2. We are seeing churn due to low adoption 3. We are seeing churn due to low-value adoption (e.g. not using new or advanced features) 4. We are seeing churn due to functionality gaps in the product 5. We are seeing churn due to product stability or quality issues 6. We are seeing churn due to poor customer satisfaction 7. We are seeing churn due to loss of our key customer champion 8. We are seeing churn due to customer service issues 5 Pillars of Customer Success OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DEMONSTRATE Value DRIVE Expansion & Advocacy ENABLE Cross-Functional Visibility
  13. 13. ©2015 Gainsight. All Rights Reserved. Business Challenges 1. We don’t have a consistent way to track customers’ goals throughout their lifecycle 2. We don’t have a scalable way to show customers how they use our product/service 3. We are seeing churn due to customers not seeing ROI or business value 4. We need to give management visibility into CSM efforts and impact 5. We need a way to report on retention, upsell, and churn 6. We need a way to forecast retention, upsell, and churn 5 Pillars of Customer Success OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DEMONSTRATE Value DRIVE Expansion & Advocacy ENABLE Cross-Functional Visibility
  14. 14. ©2015 Gainsight. All Rights Reserved. Business Challenges 1. We don’t know which customers to use as references and in marketing activities 2. We have no way to track our sponsors as they go to new companies in a scalable way 3. We don’t know which customers are trending toward needing more capacity 4. It’s too manual for us to spot customer overages 5. We don’t know which customers are good candidates for upsell 6. We don’t know how to turn happy customers into advocates 5 Pillars of Customer Success OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DEMONSTRATE Value DRIVE Expansion & Advocacy ENABLE Cross-Functional Visibility
  15. 15. ©2015 Gainsight. All Rights Reserved. 1. Our field reps and execs are sometimes blindsided by customer risks 2. Our sales reps and account managers are sometimes blindsided by customer risks during a sales cycle 3. We don’t have a consistent view of customer health across our company 4. We don’t know what’s driving risk and success in our customer base 5. We need a way to track customer relationships across complex customers, multiple products Business Challenges 5 Pillars of Customer Success OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DEMONSTRATE Value DRIVE Expansion & Advocacy ENABLE Cross-Functional Visibility
  16. 16. ©2015 Gainsight. All Rights Reserved. We don’t have a consistent way to track customers’ goals throughout their lifecycle We don’t have a scalable way to show customers how they use our product/service We are seeing churn due to customers not seeing ROI or business value We need to give management visibility into CSM efforts and impact We need a way to report on retention, upsell, and churn We need a way to forecast retention, upsell, and churn We don’t know which accounts are at risk, and which we can impact or de-prioritize` We are seeing churn due to low adoption We are seeing churn due to low-value adoption (e.g. not using new or advanced features) We are seeing churn due to functionality gaps in the product We are seeing churn due to product stability or quality issues We are seeing churn due to poor customer satisfaction We are seeing churn due to loss of our key customer champion We are seeing churn due to customer service issues Our field reps and execs are sometimes blindsided by customer risks Our sales reps and account managers are sometimes blindsided by customer risks during a sales cycle We don’t have a consistent view of customer health across our company We don’t know what’s driving risk and success in our customer base We need a way to track customer relationships across complex customers, multiple products We have accounts we can’t touch with manual outreach that need proactive attention We are seeing customer satisfaction issues due to poor hand-offs from sales to CSM We spend too much time preparing for Executive Business Reviews CSMs have too many repetitive interactions with customers It takes customer-facing team members too long to prepare for customer meetings We need to increase the ratio of accounts a CSM can handle to make CSM more cost effective We don’t know which customers to use as references and in marketing activities We have no way to track our sponsors as they go to new companies in a scalable way We don’t know which customers are trending toward needing more capacity It’s too manual for us to spot customer overages We don’t know which customers are good candidates for upsell We don’t know how to turn happy customers into advocates Identifying Key Business Challenges OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DRIVE Expansion & Advocacy ENABLE Cross-Functional Visibility DEMONSTRATE Value 1 2 3 4 5 6 1 2 3 4 5 6 7 8 1 2 3 4 5 6 1 2 3 4 5 1 2 3 4 5 6
  17. 17. ©2015 Gainsight. All Rights Reserved. We don’t have a consistent way to track customers’ goals throughout their lifecycle We don’t have a scalable way to show customers how they use our product/service We are seeing churn due to customers not seeing ROI or business value We need to give management visibility into CSM efforts and impact We need a way to report on retention, upsell, and churn We need a way to forecast retention, upsell, and churn We don’t know which accounts are at risk, and which we can impact or de-prioritize` We are seeing churn due to low adoption We are seeing churn due to low-value adoption (e.g. not using new or advanced features) We are seeing churn due to functionality gaps in the product We are seeing churn due to product stability or quality issues We are seeing churn due to poor customer satisfaction We are seeing churn due to loss of our key customer champion We are seeing churn due to customer service issues Our field reps and execs are sometimes blindsided by customer risks Our sales reps and account managers are sometimes blindsided by customer risks during a sales cycle We don’t have a consistent view of customer health across our company We don’t know what’s driving risk and success in our customer base We need a way to track customer relationships across complex customers, multiple products We have accounts we can’t touch with manual outreach but need proactive attention We are seeing customer satisfaction issues due to poor hand-offs from sales to CSM We spend too much time preparing for Executive Business Reviews CSMs have too many repetitive interactions with customers It takes customer-facing team members too long to prepare for customer meetings We need to increase the ratio of accounts a CSM can handle to make CSM more cost effective We don’t know which customers to use as references and in marketing activities We have no way to track our sponsors as they go to new companies in a scalable way We don’t know which customers are trending toward needing more capacity It’s too manual for us to spot customer overages We don’t know how to turn happy customers into advocates Identifying Key Business Challenges OPERATIONALIZE Customer Lifecycle MANAGE Customer Risk DRIVE Expansion & Advocacy ENABLE Cross-functional Visibility DEMONSTRATE Value 1 2 3 4 5 6 1 2 3 4 5 6 7 8 1 2 3 4 5 6 1 2 3 4 5 1 2 3 4 5 A B C D E
  18. 18. ©2015 Gainsight. All Rights Reserved. GAINSIGHT APPROACH TO IMPLEMENTATION High velocity onboarding focused on enabling your team to take full ownership of Gainsight Structured & Prescriptive Enabling your team Based on learning from 150+ implementations
  19. 19. ©2015 Gainsight. All Rights Reserved. GAINSIGHT SUCCESS EXPRESS IMPLEMENTATION Success Express Workshop Steps 1-6 in 3.5 days Customers & Sponsor Tracking 1 Lifecycle Cockpit2 Configuration Only – Usage and Scorecard 3 Start CoPilot Lifecycle Reporting 4 5 NPS Surveys Customer 360 + Engagement Data Health Scorecard 6 7 8 Engagement Analytics Expand CoPilot Triggered Engagement Rules 9 10 11 5 weeks for steps after Workshop PREWORK Engagement Data Integrate your other key data points, e.g. Product Usage ~ 14 days Rollout1 Rollout2 Operationalize Customer Lifecycle Enable Cross-functional Visibility Demonstrate Value Drive Expansion and Advocacy Manage Customer Risk
  20. 20. ©2015 Gainsight. All Rights Reserved. GAINSIGHT COMMUNITY RESOURCES Articles Gainsight Go contains numerous constantly-updated articles that can help answer any questions you have about Gainsight’s features Videos You can also watch many step- by-step videos that guide you through complex Gainsight features and can help you train your team Best Practices Gainsight Go is filled with best practices we’ve developed over the years so you can make sure you’re getting the most out of Gainsight Gainsight Go Advice from the Group Get advice and input from the community on Gainsight as well as customer success in your org Announcements Stay up-to date with GS announcements on products, training webinars and more Ideas Contribute ideas to improve Gainsight and see what others have contributed Community Express Office Hours Once a week Gainsight will hold ‘open’ office hours for Express Customers to ask question or seek help General Webinars Gainsight does frequent webinars on different success processes as well as product training available to all customers Training Webinars
  21. 21. Child-like Joy ©2015 Gainsight. All Rights Reserved. How Implements Customer Success Jennifer Dearman Director of Strategic Customer Engagement
  22. 22. #1 90% MORE THAN FORTUNE 500 of the use PRODUCTS & SOLUTIONS. * REDHAT * Red Hat client data, 2014 85 WORLDWIDE OFFICES 35 COUNTRIES SOLUTIONS AWARD-WINNING 500 S&P COMPANY RHT NYSE: ~7,500 EMPLOYEES OPEN SOURCE LEADER The world's leading developer and supplier of open source software for enterprise IT
  23. 23. Open Source to the Enterprise REDHAT JBOSS MIDDLEWARE REDHAT STORAGE REDHAT ENTERPRISE LINUX REDHAT ENTERPRISE LINUX OPENSTACK PLATFORM REDHAT ENTERPRISE VIRTUALIZATION REDHAT SATELLITE REDHAT CLOUDFORMS 1M+ projects* * www.blackducksoftware.com/oss-logistics/choose REDHAT ENTERPRISE LINUX ATOMIC HOST REDHAT MOBILE
  24. 24. Red Hat Subscription Model MULTI-LINGUAL 24 HOURS / 7 DAYS A WEEK UNLIMITED INCIDENTS MULTI-CHANNEL MULTI-VENDOR CASE OWNERSHIP CUSTOMER PORTAL & FORUMS KNOWLEDGEBASE HARDWARE CERTIFICATION SOFTWARE CERTIFICATION TRAINING CURRICULA (OPTIONAL) STABILITY WITH A PRODUCT LIFE CYCLE OF UP TO 10 YEARS SOFTWARE ASSURANCE SECURITY RESPONSE TEAM UPDATES PATCHES UPGRADES CLOUD PROVIDER CERTIFICATION COMMITMENTS ACCESS LABS EXPERTISE ONGOING DELIVERY TECHNICAL SUPPORT AWARD-WINNING SUPPORT YEARS AWARDED: 2011 2012 2013 2014 2015
  25. 25. It’s a disciplined approach of having: The right customer engagement strategy Easeofacquisition&exit Subscription economy http://blogs.forrester.com/kate_leggett/14-05-15-what_is_customer_success_management_and_why_is_it_important https://hbr.org/resources/pdfs/tools/SAS_Report_April2014_webview.pdf Empowering customer success managers with customer, financial, feedback and other data so that they can have the right conversations with their customers” 5500 Customers must realize the economic value of their investments “For companies providing products and services via subscription, actively managing customer relationships to ensure their satisfaction and ongoing patronage becomes a critical step in preserving their revenue stream.” Defining and following standardized engagement processes & experience design Hiring the right profile and operationally managing the team Open jobs for Customer Success Managers 1 2 3 4 “Customer success management is not about technology, or about account management.” ROI of active relationship management Churn Retention, Adoption, Growth Customers Have Choices
  26. 26. Our Journey to Customer Success • Case management • Break fix support • Technical Account Managers • Support Relationship Managers • Voice of Customer • Value of subscription • Customer success tied to business outcomes and value • Scalable engagement • Focus on customer journey • Continuous and prescriptive engagement REACTIVE PROACTIVE ENGAGEMENT+
  27. 27. Designed to accelerate the path to achieving targeted business outcomes by maximizing the value of your Red Hat subscription. Through continuous engagement and timely delivery of tailored resources, content, and tools, Red Hat Customer Success elevates our partnership to help you achieve your business goals. Customer Success Onboarding your team to help them realize the most value of your technology investments CUSTOMER Supporting product adoption by providing timely & relevant resources and tools Serving as a named resource and advocate within Red Hat Driving desired business outcomes through continuous engagement
  28. 28. Customer Success Goals Proactively engage 100% of customers with continuous and relevant content Increase product adoption and deliver greater business value Predict and protect subscription renewals and drive growth and advocacy
  29. 29. Success planning Quarterly business reviews Customer Dashboard DECISION MAKER Product Roadmap Session(s) Health monitoring & monthly Touchpoints Targeted Nurture Campaigns for adoption KEY INFLUENCER END USER Product Getting Started (Portal) Targeted Nurture Campaigns around product/feature adoption & best practices (labs, portal content, security, etc) Understanding Customers DEMONSTRATING VALUE DELIVERING VALUE Aligning IT initiatives with business goals Doing more with less Ensuring solutions operate to compliance standards and are interoperable Key Challenges Engagement Tactics Implementing practical solutions that solve serious business problems Improving efficiency, flexibility, and scalability Avoiding redundancies Rapidly deploying new technologies with existing experience Completing tasks not enabled by the current UI Spending less time automating tasks and more time preventing disruption Facing a recurring problem that could be fixed with an alternative, unapproved solution
  30. 30. Customer Success Approach RHT CSM RHT Digital Premium+ Premium Standard Marketing Managers CUSTOMER BASE ENGAGEMENT 1:Many CSM to account ratio 1:Few CSM to account ratio RHT Digital RHT Sales RHT TAM RHT Sales RHT CSM RHT Digital
  31. 31. Transform customer success processes Predict and track customer health Touch customers at scale Why Gainsight? New Resources Customer Success Roles Playbooks & Scalable Engagement Customer Lifecycle Management tool HIGH TOUCH STANDARD TOUCH TECH TOUCH
  32. 32. Customer Summary Summary of customer health across critical metrics with the ability to view over time to see exactly why overall scores changed
  33. 33. Snapshot of Customer Portfolio Health View customer portfolios to look for trends in health attributes
  34. 34. Executive Reporting Executive dashboards to track productivity of customer success managers by engagement models
  35. 35. Child-like Joy Jennifer Dearman Director of Strategic Customer Engagement Redhat jdearman@redhat.com Dhaval Moogimane Partner Waterstone Management Group dmoogimane@waterstonegroup.com Andrew Knosp Vice President of Services Gainsight aknosp@gainsight.com Questions?

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