Putting Your Best Foot Forward in Customer Onboarding

In this episode, we talk to Deepak Kumar, Chief Customer Officer, Aryaka Networks. Deepak has worked over two decades in the enterprise software industry, and was SVP and GM at [24]7.ai. At Aryaka, his key focus is on enhancing customer experience globally.

In this episode, Deepak talks about:

• Establishing a social connection with clients
• What has changed in client servicing and customer success over the last decade
• What’s next for customer success
• Reasons implementation projects in the SaaS domain fail

… and more.

Here's how the conversation transpired:

Sri: Welcome to another exciting episode of the Launch Station. Today, we'll be exploring strategies for successfully kicking off customer onboarding projects. Our special guest for today is Deepak Kumar, the Chief Customer Officer at Aryaka Networks. He has over two decades of experience in the enterprise software industry, and was the Senior Vice President and General Manager at [24]7.ai. At Aryaka Networks, Deepak's primary focus lies in enhancing customer satisfaction globally and discovering innovative solutions to support businesses in their digital transformation. We are thrilled to have you join us on the show, Deepak.

Deepak: Glad to be here, Sri. This is a very interesting topic that's close to my heart. So glad to be chatting with you about this.

Sri: We'll start off with an icebreaker. What would be three things that you would carry the first time you meet a customer and why?

‍Deepak: When I meet a customer for the first time, there are three things I focus on. Firstly, I make sure I have a deep understanding of their business. Although I may not physically carry this knowledge, it is always on my mind. 

Secondly, I try to learn more about the individual and their background. Lastly, I research the sports teams in the city they are located in. When walking into someone’s office, when I find some memorabilia about their favorite sports team, I try to pick up on it and create a connection. Being a sports enthusiast and following various sports myself, I find this approach helpful as an icebreaker. In the past, I used to bring physical items as a gesture, but now I find that understanding their business and personal interests is more effective in building a rapport. It’s very important to build that social connection.

‍Sri: That’s nice. In the last decade, what changes have you noticed in the field of client servicing and customer success?

‍Deepak: That's a very interesting question. Firstly, the emergence of SaaS has significantly transformed the concepts of client servicing and customer success. It has disrupted the traditional assumptions in enterprise software, especially the time to value components. In the past, implementing enterprise software like CRM would involve lengthy 12-18 month deployment and implementation cycles. But with SaaS, that has changed drastically. Now, the focus is on delivering value quickly rather than waiting for extended periods. Even in cases of large-scale CRM migrations, the emphasis is on deploying a few modules to see immediate value, instead of waiting for months or years. This shift in time to value also impacts customer engagement. In the past, you could take your time to correct issues in an 18-month project, but with SaaS, you must address concerns much earlier. 

Customers now expect to see early trends and results within weeks, which places a higher level of responsibility on customer success and value delivery teams. This shift in customer expectations requires a more profound and deeper engagement with customers from the beginning. Unlike the past where some sellers would sell a product and then disappear, the quick realization of value or the lack thereof leaves no room to hide now. As a result, companies must be crystal clear about the value they provide to customers and back it up with tangible evidence, such as platform usage, adoption rates, and customer engagement. Conversations with customers must prioritize demonstrating the value the product or service brings rather than focusing on its features alone. The goal is to surpass the value barrier swiftly, which is a significant change in the way businesses operate. This transformation has been particularly noticeable from 2010 to 2020 and continues to shape the industry significantly.

‍Sri: Yes, it does seem that even those who used to sell perpetual licenses in the past are now transitioning to SaaS. This means that they have to rely on strong engagement in order for customers to renew their subscriptions. As you mentioned, it is becoming easier for customers to switch providers because many others are also guaranteeing value within three months.

Deepak: That’s absolutely true. I recall a conversation I had with the CTO at Splunk. He was previously the CTO at my former organization. It was fascinating to learn that in its early stages, Splunk had the luxury of taking six to nine months for customers to see value. However, when they transitioned to a SaaS model, they faced tough competition from more agile companies who claimed they could deliver value in just two weeks. This completely changed the game in terms of what they could offer to customers. Splunk’s example highlights how even a successful transition to a SaaS model doesn't guarantee immunity from competition. It emphasizes the importance of quickly creating value to avoid being surpassed by competitors.

Sri: What is your perspective on what lies ahead in this space? What do you think will be the next major trend?

‍Deepak: The next big thing is taking very little time for expansion. Previously, when SaaS companies expanded their base to a larger clientele, it was a fairly long cycle. It took a considerable amount of time for usage to expand from small-scale implementation to becoming the preferred platform for enterprises, often taking years. However, this has changed as some enterprise software companies can now achieve platform dominance in a much shorter period. This seemingly subtle shift is, in fact, transformational in how SaaS vendors approach customer engagement and value-driven revenue growth. Chief Revenue Officers now play a critical role in adopting enterprise software, seeking platforms that meet their needs and provide control while allowing flexibility for business owners. And the window of opportunity for companies to prove themselves as the platform of choice has narrowed. As a result, companies that can crack the puzzle of effective customer onboarding and value delivery are the ones experiencing rapid growth. And that’s a phenomenal opportunity for vendors to start expanding their services as the cloudification cycle of enterprise software is still in its early stages. Companies now have the potential to achieve world-class status in a much shorter span than what it took for established players like Salesforce or Oracle. A three-year window for success is now possible, allowing new classes of companies to emerge.

Another significant trend is the API-ification of the software space, where microservices and API-driven approaches are replacing traditional monolithic software. This fundamental shift is expected to be significant in this decade and will play a crucial role in shaping the future of enterprise software.

‍Sri: Certainly! Before we deep dive into the details of executing an onboarding project, could you talk about some of the reasons why you believe implementation projects and deployments typically fail?

Deepak: In the context of SaaS or subscription-based projects, implementation failures often stem from two primary reasons. Firstly, the absence of a robust customer onboarding process can hinder success. While the software itself might be excellent and user-friendly, it's crucial to align the customer's organization to be ready for its implementation. Success lies in ensuring that the customer's behavior is aligned with the new system and that they are prepared to fully embrace it. Looking back on my past experiences, I believe creating this alignment can be vital in achieving positive outcomes.

Secondly, when targeting large enterprises with lengthy sales cycles there's the risk of losing momentum after signing the contract. There is a tendency for teams to celebrate after a deal and relax a bit, thinking that the real work starts later. However, this is precisely when the most critical work begins. Implementation involves different individuals, and there may be some changes that can happen during this phase. You need to have some change management in place for successful execution. Also, ensure the handover from the sales team to the implementation team is smooth, without losing any of the intensity or energy. Customers would have already gone through multiple processes during the sales cycle and customer onboarding will help them ease into your software. It is very crucial for both the vendor and the client. This is the moment when the focus should intensify to deliver on promises and create value in a shorter time.

‍Sri: That leads me to the next question. How can teams effectively create positive first impressions when beginning a new customer engagement?

Deepak: I think it is essential to recognize the significance of initial engagements and customer onboarding. Starting with the right intent is crucial – treating it as the most critical first impression. This mindset should come from the top, emphasizing the need to put your best foot forward. Once the intent is clear, the next step involves defining and structuring the customer onboarding process based on the type of customer being onboarded. Small and medium-sized businesses will have a different customer onboarding template compared to more complex customers. This differentiation should be evident within the customer onboarding team and may even vary by product. The third aspect is creating a robust communication and information-sharing plan that is persistent, real-time, and supports multi-party communications. Traditional methods like emails or spreadsheets often fall short in enabling effective collaboration, especially with remote teams. Therefore, having a reliable collaboration platform can help avoid unnecessary hiccups. Lastly, while processes and systems are important, the human element cannot be overlooked. A capable individual who can effectively run and execute the customer onboarding process is vital.

These four components – clear intent, a structured template or collaborative platform, a robust communication plan, and competent individuals – form the foundation for successful customer onboarding. Building a system that relies on superheroes is not sustainable; instead, the goal should be to create a repeatable and structured process that empowers good individuals to achieve success.

Sri: Yes, I agree it is important to set up a repeatable process for customer onboarding. One challenge that you mentioned earlier was about differing customer expectations when the team using your software is different from the one that made the decision to purchase it? How do we avoid such situations?

‍Deepak: In many cases, there are two distinct groups involved in the buying process. One group is responsible for making the purchase decision based on their specific requirements, while the other group feels somewhat coerced into the decision because the platform has been chosen as the preferred option by either the business unit or other stakeholders. You need to be aware of the differences among individuals and groups involved in the process before proceeding. Once you are aware of the distinct perspectives, it is your responsibility to clarify what your software is and how it will help the team. This means declaring explicitly what features and functionalities are included in the offering, enabling the other groups to assess whether the platform meets their needs and expectations. Instead of attempting to accommodate all requirements from the start, which can be risky and time-consuming, it is better to present a clear description of the package and then address additional needs later. The onus is on you, the vendor, to actively engage with these buyer groups, identify their specific requirements quickly, and facilitate a match between the platform's offerings and their needs. By initiating this conversation and ensuring alignment with at least a significant portion of their requirements you can avoid encountering resistance or passive non-adoption, which could otherwise hinder the success of the whole customer onboarding process.

Sri: Understood. Earlier, you had talked about the significance of having the right intent and intensity  from the beginning of a project. Could you share some strategies and methods you have used over the years to ensure that your team maintains the right level of intensity and intent in their approach?

Deepak: I don't know if there’s a bag of tricks. But one approach that I have found immensely valuable is to focus on a specific set of metrics to drive successful onboarding. Traditionally, I prefer using straightforward metrics, often aligned with what CFOs prioritize – revenue being a primary example. Revenue is a tangible and measurable number that reflects the success of onboarding. When onboarding fails, it directly impacts revenue, and eventually, it will lead to increased churn. So, emphasizing "Time to Revenue" (TTR) for the deployment teams places significant importance on the process, as it becomes a crucial business metric. Another valuable metric to consider is the Net Promoter Score (NPS), which provides insights into customer satisfaction and loyalty. By incorporating such metrics, you create a sense of accountability and urgency among the teams to improve their performance continually.

However, metrics alone are not enough. Engagement with customers is equally critical, and this is where customer success teams play a vital role. Engaging with customers allows you to understand their needs and concerns beyond just the numerical metrics. By combining quantitative data like NPS with qualitative feedback gained through customer engagement, you can gain a comprehensive understanding of customer sentiment and areas for improvement. This combination of measurable metrics like TTR and NPS, along with genuine customer engagement, creates a sense of intensity and focus within the onboarding process. It ensures that you stay on track and continually strive to deliver positive results. Regularly tracking these metrics and acting upon the insights they provide helps you maintain a successful onboarding process and achieve favorable outcomes.

Sri: As someone with extensive experience working with large enterprise clients, what strategies do you use to efficiently scale your business and expansion efforts, ensuring that value is delivered quickly? Are there any risks associated with different approaches to scaling, particularly when it comes to acquiring new customers?

Deepak: For a successful land and expand strategy, it's crucial to understand the type of customer you're dealing with. Early in the cycle, from a customer success perspective, we work on profiling the customer and determining the potential value they offer. During account reviews and discussions, I encourage my CSMs to assess each customer. By envisioning an ideal scenario where the customer is highly satisfied with our product, we ask ourselves if they could spend $100,000, $1 million, or more with us. Initially, this question may not yield definitive answers since it's not often asked right away. However, it is an important question to ponder as it guides the whole land and expands strategy.

It's also essential to balance expansion efforts with delivering value and ensuring strong adoption and usage of the product. While expansion is a key aspect, it shouldn't overshadow the need to provide an excellent customer onboarding experience. We must consider the long-term view of what the customer could become and focus on getting the foundation right before pursuing further expansion. Having this perspective in mind during customer interactions allows us to explore growth opportunities effectively.

Sri: So how do you assist your team in determining the appropriate size for landing a customer initially? If the overall size of the customer is large, would it be better to divide it into smaller portions?

Deepak: I don’t think there’s a formulaic way to determine the right approach to land a customer. But I do know that it is crucial to understand their appetite for adopting and using your product or service. While there may be a high-level budget view, it's equally important to assess the speed at which they can consume the offering. Evaluating the organization's readiness for such consumption provides valuable insights into their willingness to pay and use the product effectively. The assumption is that if they commit to paying, they should have the capacity to utilize the product optimally. However, there's no one-size-fits-all formula that dictates starting at a specific percentage and then gradually increasing it. It varies from customer to customer, and you must gauge their current capacity to consume. Each customer will provide unique insights into what they can handle currently. The key is to have a clear understanding of the size of the customer. This serves as a foundation for gauging how much you can expand their consumption in the future and identifying any potential barriers to increased adoption. Though the exact formula may not exist, actively considering these aspects allows you to develop a customized approach to land and expand, tailored to each customer's specific requirements and challenges.

Sri: Does it mean there’s a checklist or questionnaire of sorts that can help CSMs to determine the readiness of a customer?

Deepak: Yes. Creating a comprehensive view of customer readiness to adopt your product or platform holds immense value. And one effective approach we have used is the "Customer360" concept, which involves gaining a 360-degree view of the customer relationship. This can be implemented programmatically and serves as a checklist of key factors to consider.

Some crucial questions we ask during the  "Customer360" evaluation include:

• Are we the platform of choice for all their needs in our domain?
• Is there executive buy-in and support for our solution, especially for higher-value sales?
• Do we fit into their target architecture and align with their future vision for applications and infrastructure?

By answering these questions, we assess our fit within the customer's ecosystem and identify potential growth opportunities and churn risks. However, the  "Customer360" evaluation can also be a valuable tool during the customer onboarding cycle. Conducting these checks early on, even before the customer onboarding process is complete, can help gauge the customer's readiness to consume our product effectively. Considering this aspect during the customer onboarding phase can be instrumental in setting the right expectations and understanding any potential roadblocks that may arise. It can also provide insights into how well our product aligns with the customer's strategic goals, allowing us to tailor our approach accordingly. The  "Customer360" evaluation, when used proactively, serves as a powerful tool to optimize the customer onboarding process and foster long-term success with customers.

Sri: Is there any advice you would share with a new CS leader, who’s dealing with low adoption and potential churn? Where do you think they should start?

‍Deepak: In my perspective, low adoption of a platform often reflects a lack of engagement. I consider customer engagement to be the fundamental cornerstone on which everything else is built. When customers fail to adopt a platform, it's not merely a matter of feature functionality; it's a signal of inadequate engagement with the platform or the individuals involved. If a customer purchases a product with certain value expectations and isn't achieving that value through product usage, there's an opportunity to address the issue. Usually, you have several chances to rectify the situation and align the customer's use case with the product's capabilities. In some cases, it may become apparent that the customer's specific needs don't align with the product's intended use case, leading to churn.

To address this, the first step is to focus on engagement, which doesn't necessarily require face-to-face interactions. Logins and usage metrics can provide early indicators of engagement levels. If engagement metrics indicate a problem, it's crucial to establish a human connection with the customer to understand the root cause of disengagement. Customer success personnel play a vital role in identifying the reasons behind low engagement and finding ways to rectify the situation. By proactively addressing engagement issues and ensuring alignment with the customer's needs, most avoidable churn can be mitigated. Though some churn is inevitable, controllable churn can be significantly reduced with effective engagement strategies. It's essential to distinguish between controllable and uncontrollable churn while continually measuring customer engagement to anticipate and prevent potential churn. Rather than starting with a specific metric or renewal focus, customer success professionals should prioritize building strong engagement with their customer base.

Sri: That's a very useful way to think about customers. Moving on to the next section of our show, we’ve some interesting rapid fire questions lined up. First one: What's one habit that you picked up in 2020, that you will continue in 2021?

‍Deepak: One personal habit and passion that I picked up during the pandemic was hiking. This has become ingrained in my DNA, and I plan to continue it for the rest of my life. Additionally, I have adopted a new approach to connecting with my team, as traveling and formal reviews were no longer possible. I have prioritized informal engagement and it has allowed me to better understand my team and enhance my leadership skills. Even when travel resumes, I intend to maintain this emphasis on informal engagement.

Sri: Got it. Here's the next question. What's one metric that you live by?

Deepak: NRR or Net Retention Rate. I think that NRR is a metric that encompasses churn, renewal, and growth, making it a comprehensive measure of customer engagement. Although there are other metrics like NPS or customer engagement, NRR is a significant metric as it serves as an outcome measurement.

‍Sri: What do you think is your superpower at work?

‍Deepak: It's almost like what could be considered your weapon of choice, so to speak. 

From my team's perspective, our ability to get everyone to rally around specific metrics or goals is crucial. I don't just point out the metrics, but rather emphasize the importance of leading by example. I make it clear that I wouldn't ask anyone to do something I wouldn't do myself. This approach helps create a united team moving in the same direction, rather than me dictating what needs to be done. It's been extremely helpful in building strong bonds with my teams and achieving challenging goals. So, my superpower at work would be the ability to build a focused team with a collective mindset, coupled with a fearless attitude.

‍Sri: That's a great answer! We now move to the final section of our podcast. We’ve some questions coming in from our audience on Preflight and from Twitter. Here’s the first one: As the chief customer officer, how do you pick which customers you spend time with?

Deepak: There are certain customers that personally interest me due to their unique business aspects. Whether it's their specific industry vertical, innovative strategies, or distinctive approach, I find myself drawn to their goals. When engaging with these customers, I don't merely focus on what we can do for them; I also strive to enable them to achieve their business objectives significantly. This natural inclination leads me to prioritize a select group of customers where I believe my team and I can make a valuable contribution. 

I am also motivated by their growth opportunities. I tend to concentrate on customers who possess substantial potential but have use cases that we haven't fully cracked yet. These challenging scenarios fuel my determination to find innovative solutions and overcome obstacles. Every quarter, I identify a set of customers that I consider crucial to retain for a lifetime partnership. This isn't solely driven by the Monthly Recurring Revenue (MRR) value; rather, it revolves around factors such as the customer's brand reputation, unique collaborations, or exceptional projects we're working on together. I invest considerable time engaging with these customers alongside our CSMs to delve deep into the reasons that may lead to potential churn. My objective is to understand their situation thoroughly and strategize on how to turn it around, adopting a ‘refuse to lose’ attitude.

These three significant buckets – customers whose businesses inspire me, high-growth opportunities, and those we are committed to retaining – determine where I focus my efforts. The allocation of time between these categories may vary each quarter based on evolving priorities and customer needs.

‍Sri: That seems like a really nice way to make the distinction. Next question: What do you believe are the top three traits of a good customer success leader?

Deepak: You have to be passionate about being in front of customers and interacting with them. It is an engagement-driven role, and being proactive in engaging with customers should come naturally to you. This trait will elevate your performance. If you lack this passion for direct customer interaction, then you may not be the right fit for a Customer Success leadership position.

Moreover, you need to have an intense passion for your product. Consider it as more than just enthusiasm; it's about truly believing that your product is making a meaningful impact and changing the world. Founders and product teams often display such fervor for what they are building, and CS leaders should share the same level of passion.

Another key aspect is having a clear understanding of the value your product brings to customers. While the product teams may believe they are delivering a certain level of value, you must gauge the perceived value from the customer's perspective. You need to act as the bridge between the customer's perception and the internal view of your product's value. In cases where the customer's perceived value and the internal assessment are not aligned, CS leaders should work diligently to narrow the gap and ensure that both perspectives are in harmony. By setting your own value parameter and driving this alignment, you can effectively enhance the customer experience and foster success for both your customers and your organization.

Sri: Here's our last question for the day. You've worked on customer service products in the past. Do you have any tips for working with customers on cost-saving projects rather than projects that increase revenue?

Deepak: Typically, projects focused on generating higher revenue tend to have more inherent drive compared to those focused on cost savings. This does not mean that cost savings are not important, it’s just that initiatives that drive top line growth tend to have a different level of intensity. Cost savings may be meaningful to one group, but not as motivating for another group as their impact may be less concentrated. This is the main distinction between the two types of projects: top line projects tend to have more self-propelled momentum.

‍Sri: It was a pleasure to have you on the Launch Station and discuss these topics with us. We truly enjoyed hosting you!

‍Deepak: Thank you so much, Sri! I really appreciate the opportunity to be a part of this conversation. It's been really enjoyable to work together and tackle such interesting challenges. I love being able to share ideas and engage with all of you. Once again, thank you for giving me this opportunity.

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