Driving Customer Outcomes at Scale with CS Legend Greg Daines (a.k.a The Churn Doctor) of ChurnRX | Episode 025

In what is probably the most quotable episode of the podcast yet, Greg Daines drops some INCREDIBLE knowledge on the root causes of churn and how digital customer success programs are pivotal in driving long-term retention. 
 
How? By driving consistent Customer Results and addressing the variability inherent in changing customer behaviors.

As you will likely know - Greg is an absolute legend in the CS space and speaking with him invigorated and clarified my own thinking about the programs I'm building.

In our conversation, we talk about:

• The hardest thing founders & CEOs have to to nail down is how to make customers successful at scale
• The variable you don’t control is the customer propensity to drive change within their organization
• The tech doesn’t necessarily help your customer - their ability to change behavior around that technology DOES!
• The best predictor of long term retention is customers getting measurable results - CSAT does not predict this and isn’t even correlated with long term retention. 
• Standardizing what you do around customer outcomes & values. The vast majority of your customers will have a standard set of problems. 
• Build the digital machine around the things that you know will lead to success in every customer and then report to them on how they are doing along that path.
• Magic Words “Our most successful customers do…” Companies look to you to see how they compare with others in the space. 
• 6% of customers know from the beginning where their customer journey is going, which is all the more justification for being their guide in the journey.
• Transitioning from tools being a "place to do your work" to tools that tell you what work to do. 
• ...and much much more!

Enjoy! I know I sure did...

Greg's LinkedIn: https://www.linkedin.com/in/gregdaines/
GregDaines.com: https://www.gregdaines.com/
ChurnRX: https://www.churnrx.com/

Shoutouts:

• Geoffrey Moore - Author of Crossing the Chasm and his Adoption Lifecycle: https://www.linkedin.com/in/geoffreyamoore/
• Duolingo
• Hubspot

Transcript

Speaker 1: 0:03

When I say identify your customer's key results, it sounds like, well, go find out. No, it's really not like that. The fact is that the variability in their understanding is the source of the problem, and in the vast majority of cases, we should actually be telling customers what their key results are and how they'll know what they've achieved them.

Speaker 2: 0:22

And once again, welcome to the Digital Customer Success Podcast with me. Alex Turgovich. So glad you could join us here today and every week as I seek out and interview leaders and practitioners who are innovating and building great scaled CS programs. My goal is to share what I've learned and to bring you along with me for the ride so that you get the insights that you need to build and evolve your own digital CS program. If you'd like more info, want to get in touch or sign up for the latest updates, go to digitalcustomersuccesscom, and if you have a question or commentary to be used in an upcoming episode, call us and leave a message at 512-222-7381. For now, let's get started.

Speaker 2: 1:05

Greetings and welcome to episode 25 of the Digital Customer Success Podcast. Can't believe we're a quarter century in. It's been pretty awesome. So thanks for listening every week and if we're new here, welcome to the show. Today I've got a real treat for you. We've got none other than the churn doctor himself, greg Danes from churnrx. Now you'll know Greg because he constantly puts out these amazing statistics and insights into the current state of CS in general, and what I really loved about this conversation is he puts the digital spin on it and gives us some wonderful insights about his takes on digital CS. He's a legend and I really enjoyed this conversation with Greg Danes, and I hope you do too. Mr Greg Danes, I would like to welcome you to the Digital Customer Success Podcast.

Speaker 1: 2:01

Thank you, it's my pleasure to be here.

Speaker 2: 2:03

Yeah it's. You know, I've been wanting to speak with you for a little bit now because everybody is like hey, you need to go talk to Greg, hey, you need to go talk to Greg. Greg's got cool numbers, greg's got great things to talk about. So I'm happy to finally chat with you because, you know, not only are you, you know with churnrx and the content that you put out as part of that is absolutely fantastic. You're a frequent speaker. You know the eBooks you've put out are wonderfully metrics driven, and so I can't wait to get into some of kind of put a digital lens on some of the content that you've put out and start to talk through that a little bit.

Speaker 2: 2:50

But before we get into that, I'd like to wind back the clock perhaps a little bit and talk about MIT and what that was all about back in the day. Like you know what was that experience? Because I think you're from Utah, is that correct? Originally, yeah, originally, yeah. And then you trekked, you know, to the East Coast, went to MIT for a little bit and then came back home, right, what was that all about?

Speaker 1: 3:22

Well, we yeah, we went out to MIT and ended up staying for 10 years out there, so amazing yeah.

Speaker 1: 3:28

Well, the story that was was kind of interesting because I was, of course, deep in my career, had no intention of getting an MBA or anything, but I was doing as I often find myself doing. I was doing research, I was studying data. My background is actually economics I have a couple of degrees in economics before that and so I'm a real data, data oriented guys, you could tell. And I was. I was looking at something that was actually very interesting at the time. It's not worth going too much into, but, but there was a.

Speaker 1: 4:00

There were a couple of people, but one person in particular on the faculty there, who I had started to interact with over this research and we started doing it together and then she encouraged me to come out there for a year and work with her and they they have this thing called the Sloan Fellow Program out there, so it's basically mid career people and it was an excuse to go out and do this stuff. So, you know, I played, I, I I did double duty, where I worked full time and also did all this stuff. But it was super fun and interesting and engaging and and great experience and, like I said, we ended up liking it out there, so much. We stayed for a decade.

Speaker 2: 4:36

So yeah, Boston's a great town, Um, I, I, I spent my college career in Boston as well. I haven't been back since, Um, but it's such a such a cool town and so many yeah, such a you know it's so many universities. Obviously, there's a diversity of people. That's just insane. I love it there. Yeah, it's a. It's a, it's a cool town. But you, I went to music school, Um, you were with the smart kids. So um we, we, we just messed around in college.

Speaker 1: 5:08

I had probably had the most fun.

Speaker 2: 5:10

Yeah, Perhaps I don't know, Um, so, uh, you know what's from there. Talk to us a little bit about your, I guess, CS origin story, like where, what, what led you down this path? That that puts you in a position today to really be a thought leader in CS?

Speaker 1: 5:29

Well, so I love the CS origin story concept because nobody studied it in college, right? It's not like everybody has a CS origin story.

Speaker 2: 5:39

And it's just not when CS.

Speaker 1: 5:41

Right, right, so, um. So I actually started my career as a founder CEO, um, of a tech company, sas, b2b, um, before those two terms existed, but I'm dating myself a little bit. But um did that actually for the bulk of my career. And then, a few years ago, after my last exit, I was thinking about, well, what will I do next? And and um, I did actually, you know, work for one of the companies that I rolled into and then another one, because I had already figured out that the most interesting problem in SAS is how to make customers successful at scale. That's the interesting problem.

Speaker 1: 6:27

Everything you do as a founder CEO is hard, right, it's like figuring out how to build a product. But to find a market, hire people, build a culture, build technology, sell I mean everything's hard. But actually I think the hardest thing meaning the one that's the most slippery, that's the hardest to nail down and solve is this making customers successful at scale. And the hardest problems are the interesting ones. So I decided, you know if I wasn't going to keep doing the CEO founder thing, I wanted to work on what was the most interesting, and this, to me, is the most interesting thing in all of business. Yeah, so so I settled on this and I I did some, some work for a few years, scaling these organizations and trying some things and doing some things and and and then broke off and did it on my own.

Speaker 1: 7:10

I've got my own company, we do consulting and we also do our technology side. So I love it. I've never been more engaged in my career. I think this stuff is just endlessly fascinating, partly because it's really it's really hard right, really really complicated. So you know, that's, that's why that's how I got here, yeah gravitated.

Speaker 2: 7:30

You gravitated towards, towards the suck, as they say. Well, you know it's interesting because I'm sure you'll you'll back me up on this, but I think it takes a special breed to be in CS and you've got to have, you know, a little bit of resiliency. You've got to be slightly crazy too, maybe, but you know, I think there's a human element in CS that that that you see a lot, especially in the relationships that that exists in the CS community, which is relatively tight knit. You said something interesting, though, and I quote the hardest part is keeping customers at scale. We all know the challenges, especially in SaaS, that we face and keeping customers, and we know we like to spend a lot of time pre-sale and all that kind of stuff, and pre-sale to post-sale can be broken quite a bit. But what, in your opinion? What would be like your top three list of stuff? That makes it hard?

Speaker 1: 8:33

Okay.

Speaker 2: 8:35

I don't know if I can only keep it for a loop or a read.

Speaker 1: 8:38

No, I love it. So here's the thing that bothered me as a founder CEO before I kind of latched onto this as the interesting challenge, and the thing that bothered me was the variability. So you know, one customer would come in, take on our technology, do really well, you know, brag about us like stand on stage. Another customer would come in, look very similar, and it just wouldn't. Something wouldn't happen, right, and they'd go sideways and eventually churn out.

Speaker 1: 9:07

That drove me crazy, Because if you look at the variability, it's insane, right, it's not like we have a, you know, kind of poor results to medium results to good results. No, we have everything from nothing to phenomenal, and that's at every company, right. If you look at, like variabilities, what drives engineers crazy? Right, Because what it means is that we really don't understand all the factors in the system and so and certainly don't control them. And so that variability was the thing that kind of triggered my thinking and I'm getting to an answer to your question, but no, you're good yeah, where that led me was well, what could be the source of that variability?

Speaker 1: 9:48

right? So I'm giving the same software to all my customers, right? Maybe it varies a little bit based on addition or something, but it's not like it's there's worthless all the way to phenomenal, right. It's pretty okay. So that's consistent. Our services, whatever they were, were consistent. Sometimes they were garbage and sometimes they were pretty good. They were never phenomenal. It's really hard to do that, right, but let's just say they were the same for every customer, so that can't be the source of this huge variability right, that's not the variable, yeah.

Speaker 1: 10:20

What's the possible source? And the answer is almost impossible to avoid, which is the customer. The customer is the variable you don't control, and that is all over the place. Well, what's all over the place about our customers? It's not like they're all losers, right. They're anywhere from not so great at their business to phenomenal it's not zero to phenomenal, right. So there's something about customers that varies to that degree, and what I realized when I seized on that idea was that that's the source of the challenge.

Speaker 1: 10:57

The reality is, customers come to us and I'm speaking from the perspective of kind of SAS B2B, right, because that's my home base, but I don't know that this doesn't apply as well in lots of other spaces. People listening might be thinking about how it applies in their space, but they come to us usually because they need to improve something that they're not doing as well as they could do, and the technology and whatever else comes with it could get them to a better, higher performance, right. So well, okay, that's interesting, because now that focuses me on what might actually be the dimension of variability. So you may know, people who listening may have heard of Jeffrey Moore and the adoption cycle, right, and this idea that some customers. A very small number are innovators and they totally get what you're doing and they jump on it and, in fact, in their case, they were probably doing it already using off-the-shelf technology, right.

Speaker 1: 11:56

So, it's not like you have to convince them that this is a better way. They get it right, and there's a group that gets it. They may not have already been doing it, but they understand it. They've foreseen the future, right, but past that you start to get into people who you have to explain it to, right, okay, and there's a group there called Early Adopters that they can get it. Like, if you explain it to them and they see the value, they'll get it. But they're very different than the first two groups. What makes them different? Well, what makes them different is that they haven't actually thought it through all the implications, how it will change how they work, what they do. So now I've convinced them to buy, but now they have to go through the whole process from scratch pretty much of how this is actually going to change their life.

Speaker 1: 12:45

Yeah, okay, yeah, and you can see the further you go along this dimension and the way Jeffrey Moore characterized it was the. It was he called it the adoption cycle, because it was sort of like people's prick Pensity and the thing could be applied to a company, a company's propensity or Capacity to adopt and do something different, new, right, yeah, and, and that's not a terrible way to characterize it, so we can think of it as the ability of a company to change in ways that produce better results. Now that's what's interesting, right? So here's my technology. It does this thing better, but as long as it requires my customer to do something different. That's the source of variability. So the number one thing I don't remember how you phrased it, but the number one thing that sort of supplies this, this challenge that supports the challenge is the massive variability across your customers of the, of the Capacity to adopt and change how they work to improve their results.

Speaker 1: 13:45

And and this is a this is the thing that I like to say a lot because it's really important which is all this variability proof, something where we're kind of hesitant to accept. Especially as a founder CEO who had created my own technology, it was really hard to accept the following truth, which is that your technology doesn't actually improve your customers business. It's not the technology, and the proof of that is that if you give the same technology to everybody, why are there such variable results? They all got the same technology. You got zero to nominal. The answer is what's improving their results is their change in behavior, to their operating in a new way. Now. The technology can be very important, critical even in enabling that change and making it scalable and repeatable, but it's not the technology that improves companies. It's the change in how they operate that improves companies.

Speaker 1: 14:36

And so, okay, now we've identified the problem here. There's all this variability because this thing is very hard to come by which is within a company, even within a person, but we'll think about it in terms of a client. That's a company that there's there's massive variation in their ability to adapt to and change how they operate. Yeah, that is the fundamental source of the problem. So that's that's what I find like endlessly fascinating. How do we, you know, how do we engage with that?

Speaker 2: 15:08

Yeah, I mean you know it's. It is interesting because when you at the face of it, you know it's like oh, we bought this tool, we bought this technology looks great on paper, the business case says is going to do XYZ, and then you go to implement it and hey, guess what? There's a whole different team involved in the implementation and you kind of have to resell it a little bit. And then you know the thing that goes by the wayside to your point is that element of change management where you know you're the people on your side who are implementing it, the people on the customer side who are implementing it. You might be project managers, they might be somebody who does something else, who's tasked with implementing this thing, but guess what?

Speaker 2: 15:49

The primary goal is change management. It's like you know where's the enablement, the training and all that kind of stuff. I love that and I love that you just went on a lovely dive tribe about it, because I mean, that's the reason why Jan Young spent, you know, two months of her office hours this this summer Talking about change, because it is massively important, I think.

Speaker 1: 16:12

Yeah, well, it connects to another thing that. So, in the process of doing all this and I said I'm a data guy We've been doing a new kind of of churn analysis that I developed to address a couple problems I won't go into, but problems related to churn rates and retention rates that make them essentially useless, actually, as as metric. So what do you do instead? We do this. This. It's a type of cohort analysis called survival curve analysis, but essentially what it does is it fixes that problem, and one of the things that's interesting is we've now done hundreds of these analyses and we've accumulated all this data in a benchmark database and so we can ask really interesting questions.

Speaker 1: 16:50

Right, that I've always wanted to know and like okay, well then, you know what kinds of things predict long-term retention? Well, by far, there's no second place. There's no third place. By far the best predictor of long-term retention is customers getting measurable results. Customer satisfaction does not predicts, not even correlated with long-term retention, it's results. Well, that just raises the question okay, customers stay for results. Then that's basically what the data consistently shows over and over again. Then again, the source of variability is their ability to get results. That's what brings you back to this behavior change. It turns out the customers who get results are the ones who change how they work to take advantage of the way your technology produces value. That is a big deal. So then what does that tell us? Well, it tells us that the purpose of CS is to ensure customers get results. I think very few people would struggle to agree with me on that. But that's the purpose, but that's not our function. That's not our function. That's our purpose Exactly. The function is to get customers to change behavior.

Speaker 2: 18:00

I love the post that you had on LinkedIn very recently about it. Related to it, the fact that one of them was around, just the fact that QBRs don't work, but I forget the exact post that you had that basically, oh, stop touching your customers, which is great. It's like no high touch, no low touch, just results.

Speaker 1: 18:28

Yeah, if we focus on results, it will always inevitably lead us back to well, why is this customer not getting results Every time? They're not doing something essential to get results, so it's in the end. Results are our purpose, but our function is behavior change, that's what we do for it.

Speaker 2: 18:47

Yeah, I love it. So just to reel in a little bit, this is the Digital CS podcast and if you've listened to the show, you know that one question that I ask every single one of my guests that I compile on the website is their elevator pitch of Digital CS, because it changes depending on who you're talking to background, what they do for a day gig and all that kind of stuff. So I would love from you your 10 to 30 second elevator pitch of Digital CS.

Speaker 1: 19:15

Okay. So if customer results are what drive long term retention and variabilities the enemy of that outcome, then Digital CS is the ultimate and most scalable methodology for driving consistent, standardized customer behavior. Change at scale Love it.

Speaker 2: 19:39

That's beautiful, Very concise and to the point, and I couldn't agree more. One of the eBooks that you have out and I think it's available on your site is basically, I think it's like the 23 ways to reduce your might be 24, might be 22. 23? How'd you land at 23?

Speaker 1: 20:01

Because it's 2023 and I thought that would be cute.

Speaker 2: 20:04

See I'm smart, but in it I find it brilliant because there's just concrete, practical, data driven advice for how to reduce and stop churn Right, and it all makes sense. And, again, it's data driven, which I find refreshing, because a lot of us talk about the CS echo chamber and everybody's kind of posting about the same thing, but when you post about things, I guarantee you there's some kind of bell curve behind it or some kind of chart behind it that actually backs up this idea. What I'm getting to, though, is a lot of these motions are kind of high level ideas that you can implement in your business, depending on how you're structured and who you have on teams and what tools you have and all that kind of fun stuff, but I wonder if any of them particularly stand out to you as being particularly adept to digital automated motions.

Speaker 1: 21:10

It's a good question For any listeners who haven't seen it. There are things like stop underselling, right, sell to good fit customers instead of bad fit customers, get customers to engage quickly and integrate with other systems. So there's a whole bunch of them, and so I think there is a very good answer to your question, because there's a general theme here that, okay, there's 23 things here, but actually if you've read through them, what you do, what you get is a sense that actually there's a pretty consistent kind of overarching thing, which is the things that guide customers to get better results are all in the do those things category. Right, and anything that gets in the way of results is in a don't do those things category. What's that have to do with with digital CS? Well, it's important to understand that.

Speaker 1: 22:12

Well, okay, let me put it this way One of the big mistakes we've made in CS generally and I think it's a, and I'm happy to engage with people who challenge this, because I really do think this is important to understand is that we've been inclined to take the position that all customers are different, that they're all unique and we need to meet them where they are, and we need to. Well, they certainly are unique. In fact, I spent the first part of this podcast arguing that they're hugely variable. But you see, that's different than saying that that variability is good right.

Speaker 1: 22:50

In fact quite the opposite, and if we take a highly variable approach, which is increasingly impossible, impractical to do because the economics don't work which I consider a good thing, because actually I don't think it's a healthy way to handle it. The truth is, at the heart of the methodology that I push is well, start by identifying what your customers results are, otherwise we have zero chance of getting them. But that almost sounds like well, find out what they expect and meet that. But that's actually not true. The vast majority of customers, if you ask them what they're trying to do, they'll say I'm trying to install this software. They haven't actually thought it through Majority. Now some customers do like they come and they've got it and they've thought it through correctly, blah, blah, blah. But that's like a pretty small fraction of our customers. The vast majority of them do not have not thought it through carefully. What's the key business result I expect and how will I know if I have achieved it? Very few companies have gotten there. So the reality is that it's when I say identify your customers' key results, it sounds like, well, go find out. No, it's really not like that. The fact is that the variability in their understanding is the source of the problem and in the vast majority of cases, we should actually be telling customers what their key results are and how they'll know what they've achieved them.

Speaker 1: 24:15

Think about it this way it's not because they're dumb. They are client precisely because they're trying to do something new that they haven't done before. If they were really good at it, it's arguable they'd even need us, right. So they show up to do something new and we ask them what are you trying to accomplish? It's a weird signal to send. It's like well, you guys, only it's not like. Your product does 5,000 things. I mean, there are very few products like that and people argue well, greg, you know, but their value could be all sorts of things.

Speaker 1: 24:46

Yes, that's actually the problem, right? Because I can't materialize all sorts of results to them. I can only materialize the things our product is really good at doing. So there's only a few of those right. In many cases there's one, but okay, let's say there's two or three right your product does. They're clustered around a core theme. The client needs to understand that clearly, otherwise they won't recognize results when they arrive. Second, how could they possibly be expected to have a clear and well articulated understanding of how the metrics will materialize right. So this is my long way of saying in every, in almost every case where we talk about building a high retention, low churn process, what we're talking about is standardizing what you do.

Speaker 1: 25:38

Standardizing it Don't say, well, it could value, could be anything. No, it can't. Right. Don't say, well, every customer has to take their own path. No, the vast majority of those paths are paths to failure. If you worked for any amount of time with clients in your business, what you'll know is that some of them are phenomenal at it. You know what we need to do. Just go figure out what they did right, bottle that and then push our customers through that process. So I think one of the big shifts in CS that very much aligns with digital CS is a shift from being sort of reactive and supportive to proactive and prescriptive. Right and well, digital CS forces you to do that in a way that I actually welcome. I don't see that as a bug, that's a feature.

Speaker 2: 26:25

Right Yep.

Speaker 1: 26:26

Exactly.

Speaker 2: 26:28

Okay, my brain works in weird ways sometimes and the analogy that keeps coming up in my brain is the spaghetti factory menu. No, sorry, the cheesecake factory menu, because when you go to the cheesecake factory you're presented with this massive menu of just stuff and decision fatigue creeps in and you can't decide what you want to get. And our software doesn't do that, right, software, generally speaking, is like your mom and pop shop around the corner that has like five or six things that are really really good and you know you can choose from those five or six things. But it's not like this massive thing where you can have, you know, whatever Italian and Chinese in the same city. Right, so right.

Speaker 1: 27:15

And the other thing is, I like your analogy, but like it's not even if you think. Well, our product really is like that. Maybe you're from some big, you know, complex company? Sure, yes, but customers don't show up considering both Chinese and Italian. They came from the Chinese or they came from the Italian. So you still have the narrow scope that you need to push them down a pathway.

Speaker 2: 27:37

Yeah, and I think this notion of self selection is pretty powerful in digital Like.

Speaker 2: 27:43

I've seen a few instances where you know you may have a pretty large segment of your customer base that maybe don't have an assigned CSM and you know they're kind of trundling through and they're using your self help here and there, either successfully or not successfully. But still the thing that's lacking a lot of times is that clarity around what it is, what, what are the? You know what are the positive business outcomes that you're trying to achieve as a business as a result of purchasing the software. And I feel like you know there's a massive opportunity digitally to have a customer kind of self select on that and self kind of track towards those objectives. But even deeper than that, on a persona level, your admins to your point earlier are going to just care about hey, is this thing installed, is it working, is the data flowing properly? But also, in some instances I think it's the vendor's responsibility to educate the admin how their actions are impacting the overall goal that the software is purchased for. To begin with right.

Speaker 1: 28:49

Very strongly agree with that. The idea that not only did I suggest that the customer isn't always clear on what they expect, then they hand it down, because there's no handoffs in customers, there's only hand downs right. Then they hand it down to an admin, a project manager or somebody, and the expectation that that person has a clear understanding of how to connect the dots between this all the way back to business value is absurd. So we really have to. This is the winning play, the winning move in this game.

Speaker 2: 29:19

Let's go wait, hold on you're getting my pen out.

Speaker 1: 29:23

It's not to follow the customer anywhere but to lead them. And in digital CS we have to do that because I know there's a fantasy that exists out there to some degree about the kind of choose your own adventure kind of thing where there's lots of options. And because of this and this and this, I go down a totally different path.

Speaker 2: 29:42

Yeah.

Speaker 1: 29:43

I just don't think that's founded on reality. Again, your product doesn't do that many things, and even if it did a couple of things, the most important thing to understand is that there aren't that many pathways to success. I mean, what if there were seven choices as to what I was trying to achieve? Right, save time, make money, save money, something like that.

Speaker 2: 30:01

right, and there were seven and I chose.

Speaker 1: 30:04

But how many variations are there of how you actually get to those results? You still have to install the thing, you have to connect it to something else, you have to change how you manage something, you have to change a process somewhere else, and the reality is it's possible that, no matter which of the seven I chose, it's almost certain that the pathways the same anyway. Right, and we have to be very careful. Right, because one thing I said was go look at your most successful customers, the really sophisticated ones. They'll show you how to do it. But there's one caveat to that it's very important. That is to understand that when I look at a highly successful customer now, I can see hundreds of things that they're doing that are better than my low sophistication customers.

Speaker 2: 30:44

Right.

Speaker 1: 30:44

So which ones are we talking about? It can't be hundreds of things, and that's right. That's that's actually an important thing to understand. The things that matter most to the rest of my customers are the things that those sophisticated, successful customers did first. Yeah, it's not all the things they're doing now, because they're way down the pathway. Good for them. Yeah, they're freaking high, hanging fruit off the tree. What I want to know is what did they do to get to their first results? And that allows me to collapse the scope down again.

Speaker 1: 31:14

Right, I'm not solving for sophisticated customers because they're already going to succeed, and they don't turn, I'm solving for the ones who are going to fail, who don't know what they're doing. So I'm going to solve that. I'm going to show them what they're doing, why they're doing it, how to measure it, and then I'm going to show them what to do first, second, third. So one thing that that I think is a trap in the digital CS kind of pathway that you can get down is to say well, robots are good at everything. They could give me 25 options, and then they, could you know. You match that with. You know 75 pathways, and then AI, could you know. I mean no.

Speaker 2: 31:50

And make me popcorn along the way too. No.

Speaker 1: 31:53

There are only so many things you're doing and there are even fewer ways that your customers have to operate to get there. Once you understand that, this becomes an extraordinarily powerful tool set, because it really does allow me to standardize. I mean, even if so, take the alternative. I'm working with humans. I've got a team of CSMs that are all named account CSMs, right, and I want to standardize what they do. Do you know how hard that is to get them all to do the same thing the same way over the same period of time for every customer? I mean, it's just extraordinarily challenging. It is, but with a robot, that is something I can do. That's something the computer, the system, the technology will do what I tell them every time, following these rules. Now the challenge then shifts upstream. The challenge isn't to get the consistency and standardization in the system. The challenge is to decide what should do. What are the rules then, right? What should we force customers to do?

Speaker 2: 32:51

It's the curation of the experience yeah.

Speaker 1: 32:55

Do we really know why customers succeed, what they do first, second, third, what are those things that, if I guide my, so you could ask your, I have, I have this, this, this question that I think helps guide people's thinking through this, which is, if I came to you, I'm a customer, and I came to you and I said, look, you know, alex, way more than I'll ever know about this. You guys do this every day for thousands of customers. You're the experts. I will do whatever you tell me to do, if it's in my power to do it, would you think that I was likely to succeed? Well, yeah, right, even if I admit we're not a very sophisticated organization.

Speaker 1: 33:34

We've failed at a lot of things. But I promise to do, if it's in my power, what you tell me to do. I would say that that customer's chances of success are pretty dang high. So, instead of waiting for someone to do that because that never happens, or so rarely that it's you know instead of doing that, just operate that way. Just build the machine that says here's what you're going to do, here's the result you should be motivated by. Here's the right way to know if it's coming in. Do these three things quickly and we'll get you to those first results that prove you're Literally using the language.

Speaker 2: 34:08

our most successful customers, by day 50 of their journey with us, have done X Y, z. Where are you on that list?

Speaker 1: 34:15

You know, like, like totally, by the way, that competition. Yes, well, what you've just said is actually magic words. Now, there aren't that many magic words in in in the world of customers and customers, or in the world of business, but one of the most powerful magic words are our most successful customers do X.

Speaker 2: 34:36

Totally.

Speaker 1: 34:37

Why is that so powerful? It took me years to figure out why that, of all the things I was saying, why was that? That grabbed people's attention? And suddenly they were paying attention. They were looking at me again, right? They looked up from their phone and the answer is because actually, your customers know they're not very good. To a degree, they know they suck. Right Now it's not like they talk about it. We don't need to talk about it. But just because we're not talking about it doesn't mean that's not the real conversation. They know your stuff's good. They know that such and such cool company made millions off your technology. You know what they're thinking. They're thinking. But will it work for us? Because we're not cool like those guys, we're sucky. The last five things we tried to do all failed, right? That's actually the subtext, the unspoken dialogue, right? So when you say the magic words, our best customers or our most successful customers do X boom. You get their attention really quickly.

Speaker 2: 35:36

Totally, and it's kind of like. Another analogy might be like I don't know a sports broadcaster or whatever. They may see 10 different football games in a season. Whatever it is all different teams. They've experienced all the different teams and what makes one team successful over another team, which is a perspective that the individual players don't have, because they're in the trenches, within their own tribe, within their ecosystem, right, and so when you say those magic words as well, it's just like you're putting yourself in the position of hey, I've seen other people do exactly what you're trying to do, so listen up, I can tell you how to do it.

Speaker 1: 36:24

Yeah, exactly, look, I love your analogy. It's probably better than the one I always use, but the one I always use is we sit on Mount Olympus and we look down and we see what everybody's doing the good, the bad and the ugly. And so when we say the best companies do X, people take it seriously. They can't see it from their seat where they're sitting, but they know we can. And actually this is really interesting because I would argue this is more important than our product as something we sell to our guests.

Speaker 1: 36:56

Yeah, absolutely Right. I mean, you could play the game of which product has more features and go blue in the face. As of today, there are almost no spaces left where you can legitimately argue in favor of one vendor over another based on what's really hard to do right.

Speaker 1: 37:15

And getting harder by the day. So what are they really coming for then? What's the differentiator? My argument is, the differentiator is what I call expertise, the ability, the knowledge of how customers get results. And when you say, well, we've done this for hundreds or dozens or thousands of customers, we know how the best get results, yeah, honestly, that's the thing that is compelling. And if they think you're going to give it to them right, either through a human interacting with them or, even better, through consistent, digitally delivered Intel, that they can get on demand when they need it or, even better, delivered to them before they realize they need it, then that's compelling. Like I would argue that expertise is more important than the product. Yeah, I agree, I agree.

Speaker 2: 38:04

Speaking of those digital deliveries of kind of compelling information or just digital motions in general, we're all customers, right? We all have 80 different software solutions that we log into on a daily basis. What are some of the really cool things that you've seen done where you're like, oh that's cool, Like I'm really glad they're paying attention to this or this surprised me. Are there things that stand out to you?

Speaker 1: 38:38

Little bits here and there. I think we have yet to really make this transition and sometimes I'll see them in really like oblique, off the beaten path type places. So one of the interesting things that I see is I'm not a big languages person, but people who've adopted technology like Duolingo and some of these others?

Speaker 1: 39:02

what are the things that they have? That they have gone? As about as far as you can go with and I love it is to assume that they know where you're going much better than you do. Right, right, that's certainly true, right? If you're learning a language, absolutely, and what they do is they just prescribe the exact pathway through and then show you, at each stage, precisely how to think about what you've accomplished, even to the point of batching it in prizes and a pathway.

Speaker 2: 39:33

I'm sorry, but Game of finding it yeah.

Speaker 1: 39:35

Yes, we really should take that more seriously in the world of sort of more advanced, complicated technologies. And one of the gosh, one of the things that's really interesting, back to the adoption cycle, right? Something like 6% of customers, according to Jeffrey Moore and I, by the way, my experience is that's pretty solid Sure, have an idea from the beginning where this is all going. Pretty much everyone else is somewhere on the spectrum of either not knowing, or even to the point of being incapable of knowing, right? So they're somewhere past that, right? Well, you know, isn't it? Isn't that all the more justification for us to play that role for them, right?

Speaker 1: 40:27

So I've actually I haven't had a chance to really say this often in public, but I have a theory about this that I think is really interesting, which is the first, and I'm old enough to have seen this play out but the first wave of technology computers doing things in application form that solved business problems or real-life problems the first wave of it was really technologies directed at people who already knew what they were doing and just needed tooling.

Speaker 1: 40:55

Sure, so I call that the wave of what that technology did was to provide a place to do your work, right. So it's an extreme example, but like Excel, it doesn't have any presumption as to what you're doing. It assumes you know what you're doing right and it gives you endlessly cool technology. It's a Swiss Army knife, right? Sure, that was a whole wave of technology. For many years, for decades, you couldn't really buy an advanced business application without being about as advanced in that business category as you could be, and anyone who wasn't couldn't consume it. And it was that simple right. And think of some of those more traditional systems from Wang and IBM and SAP and all that stuff.

Speaker 1: 41:39

So, I think we're in the middle of a massive transformation, from that to a new station, from there to a new place. And where is that new? What is that new place? It's fundamentally about going from a place to do your work to tools that tell you what work to do. Now we can have where we enfranchise the rest of the world. Right, cause there's an app for everything. And that's reality.

Speaker 1: 42:04

I believe software is transformative to the world. I think it's the most important technological transformation in history. We just haven't seen it play out yet. Why? Because there is technology in an app for everything. Now the only problem is we can't win if only three or four or five or 6% of the world can consume it. It means that tools have to tell you, not just not just give you a place to do your work, but tell you what work to do and how to do it. That's the interesting thing. So now, rolling that all the way back to CS and SAS, b2b and digital CS that's our mission. That's why the old method of CS was to be responsive, supportive and helpful. The presumption baked into all that was that the customer knew what they were doing.

Speaker 2: 42:49

Knew exactly what they were doing. So what if the customer doesn't know?

Speaker 1: 42:51

what they're doing, then we have a completely different mission.

Speaker 2: 42:55

Our mission is to show them what to do, to teach them what and I still feel like there is a hesitancy among CSMs in general to be that right. I think it's still kind of this world of almost at the mercy of the customer a little bit, versus being like super, super, hyper prescriptive and then you know, yeah well, there's a problem.

Speaker 1: 43:17

There's a real reason why they're hesitant, and that's because you have to know what the answer is. If you're going to be prescriptive, now that sounds worse than it is. We have a solution for that that every company listening to this podcast or not, can deploy, and the answer is well, if I have a team of 10 or 50 or 150 CSMs, I can't rely on whether they know things. Yeah, this brings us all the way back to standardization. In the case of standardization, we only have to know it as a company, and because we sit on the top of Mount Olympus, if we don't know it, shame on us for not having paid attention. That's actually one of our fundamental, I would say, obligations.

Speaker 1: 44:00

Sure, in owning the customer relationship is that we're the ones who should be carefully observing what works and codifying it. And once you've done that that's why I said the challenge shifts upstream Do we even know? Because it's not like about it's not being an encyclopedia of knowledge in the domain. Because, by the way, that's not relevant. It's cool. It's not relevant why? Because the vast majority of customers fail in the first one or two steps. I only need to know that much and we only need to build that much into a process. But if we have a longer knowledge, if we can see it going all the way to 11, then we can capture that knowledge and codify it into our process. I don't need a room full of experts, but I do need the expertise that's embedded in that understanding of the success pathway.

Speaker 2: 44:50

What you're saying is very interesting and I wanna tie a couple of things together here that you've talked about. One is I loved your Duolingo example of it's very prescriptive, it follows a path and in essence I mean it's B2C right, and you could argue that B2C has had this stuff figured out for a very long time. I mean, even you think of retail and retail rewards programs and all this kind of stuff, like they've gamified the behaviors that they wanna drive in their customers. And perhaps there's a hesitancy to do that in B2B because maybe it seems a little childish or it's too prescriptive or whatever, and I think that hesitancy has hurt us. If you ask me.

Speaker 1: 45:38

Oh, absolutely, you're absolutely right.

Speaker 2: 45:40

Why not have a little fun with it? I mean, come on.

Speaker 1: 45:45

So I have a great example of this that I think helps kind of think this through. So I was working with a client. Their customers were dentists, right, and they were selling a solution that helps dentists essentially optimize their business, make more money, right, okay? So the CSMs were very hesitant to push one very specific thing that essentially made dentists change away. They operate right, okay. And why? Well, because it's not rare at all for them to snap back and say stay out of my business, that's not how I operate.

Speaker 2: 46:20

You're not a dentist. Happened all the time.

Speaker 1: 46:24

So I got on. I actually got on a call with this young girl, very sweet, very good at what she did but very hesitant to challenge customers, and I gave her an exact script. And here's another set of magic words.

Speaker 2: 46:38

Did it say you're most successful dentists?

Speaker 1: 46:43

So she said you're going to change, you're going to do this. I'm even going to send you it's a sign. You're going to put it up in your waiting room, right here it is. I'm going to send it to you a PDF. Print it out. I don't operate that way. I've never operated that way and I've been in this business 30 years. She I could see her, you know, virtually wanting to. You know, hang up the phone. But she reacted. She gave the script, which she said oh, I understand that you know more about dentistry than I'll ever know, but we know more about this, and the most successful dentist, the ones who make the most money, do this. And you know what he said, cause he was, he was really gruff with her.

Speaker 2: 47:18

He said oh, okay, oh, I get it For more money.

Speaker 1: 47:23

Yes, I like more money, so you get the idea.

Speaker 2: 47:26

You're not challenging my ego as a dentist.

Speaker 1: 47:29

Right, no, exactly right, it's like yeah so so your point is, I think, a really important one, which is there's a cultural foundation in customer success that could use a little bit of a revision here, and it's the I'm super helpful, I'm Johnny, on the spot when you need help. Blah, blah, blah to no, I'm actually not here to help you. I'm here to make you money. I'm not here to make you happy, I'm here to make you money, and because of that, I'm actually not going to just let just walk away from you saying I won't do X. It's one of the three things you need to do to make more money and that's all I exist for Right Now. That you can say it in a nice way. What I love about people in CS is that they're actually very good with people. Right, they're very diplomatic and they're very civil. Sure, they're the perfect people Like. There are some people I'm not sure I would want to teach this to them. They just get too much joy out of poking people in the eye, like engineers or people like that.

Speaker 1: 48:29

But the point is in CS, I can show a person like her, who brings so much human kind of qualities to the and talents to this. I can show her a way to do this that's actually demonstrates to the client it's in their own interest. Now, can you do this at scale? Can you do it with technology, of course, because it's the same script, it's the same process and in fact the cool thing about the technology is it's not afraid of getting yelled at.

Speaker 2: 48:56

All right, exactly Like. You can just close the pop up.

Speaker 1: 49:03

And before it closes it'll pop another thing and say it's like, are you sure? Just be aware that if you don't do this, you'll make less money.

Speaker 2: 49:09

That's right, I love it. I mean, we might as well be blunt with it, right?

Speaker 1: 49:15

No, the thing is not to be blunt with that person would have been a disservice to him.

Speaker 2: 49:19

It's a disservice yeah.

Speaker 1: 49:20

Right, that's not what we're for. We're not here to be nice and we're not here to make you happy. We're here to make you money. Yeah, I know, maybe that, like I know, there's people in CS and I like to say it that way because it's a little provocative but there's people in CS who just oh, cringe when I say that. I'm not going to stop saying it because it reminds us that what we do is actually a high art. I consider it a calling, like I genuinely do. I know I'm a little cringy or goofy about this, but I think what we do really matters, but not because it makes a person feel better about themselves in the moment, but because it's going to make their business successful, which they've poured their life into. It's going to make their career go better, which, you know, their family depends on. I like, to me, making them successful is the highest good that we can appeal to and attach our meaning to and, as a result, it makes, I think, customer success absolutely satisfying and fascinating.

Speaker 2: 50:19

Yeah, the reach is pretty spectacular, especially when you think about that, because then you know that extends into employees and families of employees and you know that whole ecosystem which is cool.

Speaker 2: 50:32

It's cool to think about. We are painfully getting close to being out of time because I don't want to swallow up too much of your valuable time and I feel like we could go on forever, but there are a couple of just things that I want to make sure that we spread to the community, which is, first and foremost, I want to understand what's kind of in your content diet, what do you pay attention to and how do you keep yourself abreast of things?

Speaker 1: 51:01

Well, I'm a bit of a nerd, so I already told you I'm an economist. I'm hard and oriented.

Speaker 1: 51:06

So I read lots of nerdy things and I have been on a kick for a while about nerds. I've been on a kick for a while about neurology. I just there's just so much about the human brain and the way we think. That's endlessly fascinating. So lately I've been studying the difference between the left and right brain hemispheres and what's the science teaches about that, and how do those not just work together to create the way we think and the way we operate, but actually conflict in many ways? Very fascinating stuff.

Speaker 2: 51:37

Cool.

Speaker 1: 51:38

That's something I've been into.

Speaker 2: 51:39

I dig it. Yeah, I mean there's implications to that right and helping you understand who you're talking to. That's huge. Are there folks within the CS community that you see doing great things digitally that you might want to call out and give a shout out to?

Speaker 1: 52:02

Well, probably too many for this context, but I love what I'm seeing certain companies do I mean, HubSpot's been really charging down this road to figure this thing out. I just I like people who are breaking their kneecaps trying to figure out how to make this work, and it's not easy, but the more you do it, the more it lights the way in front of you. So I love, I just love seeing that kind of thing.

Speaker 2: 52:26

Yeah, people are grinding to make it happen. Where can people find you, engage with you? What have you been up to? Are there things that you want to make sure that people go check out that we can link down below in the show notes.

Speaker 1: 52:41

Well, sure, you can check me out on LinkedIn. I post a lot of stuff, but I actually have a weekly newsletter. You can go to gregnankscom, but I also have everything I've ever written there my ebooks are there, videos of all my speeches, I mean that I can get a hold of. So it's a great resource to just find all this stuff. And then there's links, obviously, over to churnorexcom, our company, and you can find out about what we do there, and there's a.

Speaker 2: 53:04

There's a couple of free resources there that I think are helpful to all the content on your website, the one that I had the most fun looking at is just the page of quotes. Oh, it's like it's. It's cool you could spend. You can spend a few minutes just going through the quotes and not just reading them, but like thinking about them for a second. It's really cool.

Speaker 1: 53:25

Yeah, well, I appreciate that. I encourage anyone to go there and and subscribe to that. But also link in with me. I love meeting people. I in the CS world. I just I feel like I want to meet everybody. It's not possible, but please, please, decide to opt into that, because I'd love to meet you and learn from you.

Speaker 2: 53:42

Cool, that sounds good. I want to thank you very much for your time. I would very much love to do an episode two of this conversation where we dig in a little bit deeper perhaps. But yeah, thanks for your time and really appreciate it.

Speaker 1: 53:58

My pleasure. Thanks, Alex.

Speaker 2: 54:00

Thank you for joining me for this episode of the Digital Customer Success podcast. If you like what we're doing, consider leaving us a review on your podcast platform of choice. It really helps us to grow and to provide value to a broader audience. You can view the Digital Customer Success definition word map and get more details about the show at digitalcustomersuccesscom. My name is Alex Turkovich. Thanks again for joining and we'll see you next time.