Law 7: Obsessively Improve Time-to-Value

Author: Diane Gordon, Chief Customer Officer, Brainshark

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Executive Summary

Why do people or companies buy? They think they'll get value from their purchase. If you're a consumer, this might mean spending a lot of money at a fine restaurant because you hope to get an above average meal. And you find out pretty much right away: it's either delicious or so-so. Based on that, you can decide whether you'll ever return.

But when you are selling business products and services, it's often tough to show value that close to the transaction. Although buyers know this, they do expect to see value in a reasonable time frame. For SaaS or subscription-based vendors, that time frame is the length of the subscription. If the customer hasn't seen real value by the time renewal discussions begin, they're far less likely to renew. Working against the vendor is how long it might take to get the customer up and running with the solution. Obsessively improving time-to-value is the way to address this challenge.

A big part of any sales process is convincing prospects that they will get real value from your product or solution. In the world of SaaS or subscriptions, delivering that value quickly is key to retention and expansion. Customers don't renew or stay with you or buy more unless or until you deliver value to them.

If you're implementing enterprise software on a subscription basis, the onboarding process alone can span a few months, leaving only a few additional months of production time in which to see value. That's pretty risky when there's a one-year renewal looming. To highlight this challenge, consider the extreme: if it takes 11 months to get a customer up and running and the contract is 12 months long, are the odds of renewal better or worse than if the customer had been live in 60 days (see Figure 11.1)?

There's clearly a direct correlation between the length of onboarding and the likelihood of the first renewal. If you are in a pay-as-you-go business in which all contracts are monthly, it's even more critical.

What's the secret to ensuring that the customer sees value as quickly as possible after buying your solution?

• Work with the customer to establish concrete success measures.
• Implement iteratively for early value, achieving the simplest measure first and focusing on the others later.
• Adjust in real time, springing into action the very moment you realize expected value is at risk.

Let's look at each of these points in a bit more detail.

Establish Concrete Success Measures

Ideally, your customers made a buying decision based on the value of your product or solution. Even more, they know how they're going to measure that value.

Work with the business sponsor to define measures early. It is critical to leverage business sponsors while you have their attention during the sales process, because they will likely be less involved in the tactics of the implementation itself. Trying to get the business sponsor's attention later in the customer life cycle is difficult, after they have moved on to other things. Taking advantage of the opportunity to have the business sponsor's focus earlier on is the best way to capture success measures that resonate at the business level of the organization.

If you're lucky, the customer will have a concrete answer: “We want to cut in half the time it takes to onboard a new representative.” But much more often, while customers might have cited key drivers, they don't have specific measures in mind (and if they do, they don't know what the baseline values of those measures are today). In this case, rather than asking the customer to come up with metrics (something that can take a while, especially in a complex organization), we present a list of the measures our customers typically use to gauge success:

• Decreased time to reach quota.
• Increased number of representatives meeting quota.
• Increased number of converted marketing leads.
• Increased deal size or revenue.
• Increased percentage of representatives actively using Salesforce.
• Increased amount of time representatives spend selling versus searching for content.
• Decreased time to onboard representatives.
• Decreased time to close first deal.
• Decreased time managers spend coaching representatives.
• Increased representative competency with material.
• Increased number of representatives who fully complete onboarding curriculum.
• Increased viewership (number of views).

We ask the customer to choose from these examples, making sure that they have baseline values for any measure(s) they choose.

You should also communicate these measures to the onboarding team. One process that works well is to have the success measures documented by the pre-sales team and then pass those on to the onboarding team at the beginning of the implementation process. Then, during the onboarding kickoff call, the pre-sales engineer validates those measures with the customer: “During the sales cycle, you indicated that decreased employee onboarding time was a key driver. Is that still true? If so, how long does onboarding take today?”

It is only after these success measures are clearly defined that we start the onboarding clock. Otherwise, you may find yourself months into an onboarding program—or, worse, fully implemented—without the customer knowing whether they've gotten any value from your solution.

You can also create a positive carryover effect with these concrete metrics. If you do QBRs or some kind of regular reviews with your customers, you can revisit these metrics frequently (1) to determine whether they are still the right metrics for the business and (2) to validate your success against those metrics. Many customers seem to shy away from measuring hard ROI, despite having often been adamant about it during the sales process. But you know it will come back to bite you if you don't help the customer measure it.

Implement Iteratively for Early Value

Don't boil the ocean. The fastest way to get to value is to begin meeting those most easily achievable criteria. For example, customers that buy a solution to improve sales productivity might use two or three (or more) success measures: decreased time to onboard sales representatives, more effective prospect engagement, and increased percentage of representatives hitting quota.

Although these are all achievable, the customer will see value more quickly by starting with the most important measure. Do this through an iterative implementation process, focusing on, say, training and onboarding times in Phase I and improving prospect engagement in Phase II (see Figure 11.2).

There are other ways to get to quicker value as well, for example, rolling out to specific groups, divisions, or geographies rather than an entire user population, or focusing on one or two specific initiatives (e.g., rebranding) or product lines. Slicing the challenge into small achievable chunks and implementing iteratively produces value early and often.

Also, confirm constantly. Don't make the mistake of assuming that just because the business sponsor defined metrics during the sales cycle and the customer's project team validated those metrics, they will remain the ones that matter:

• List the measures at the top of every status report and call attention to them during every check-in call: “Just checking in—these are still the measures that we care about for this phase, right?”
• At multiple points during the onboarding, connect directly with the business sponsor to validate the measures.

Additional Commentary

The key word in this law is obsessively. In general, everyone wants to improve the time it takes to do anything. It's part of our DNA as employees to drive improvement in everything we do. But how many things do we really obsess over? Not that many. This is an area where you need to.

Let's draw a comparison to sales here because great salespeople obsess over getting their deals closed. It's part of what makes them great. When they are driving home on a Friday evening looking forward to the weekend and their phone rings with a call from a prospect, what do they do? They answer it, right? They answer it because they know that every single day in a sales cycle is critical and that there's only one good day to close any deal—today. Every sales rep who has been around for a time can tell you about the one that got away. The deal they had almost signed on a Wednesday only to hear about layoffs, poor earnings, or an organization change on Thursday, which derailed them. Salespeople know about obsessing over every day because every day matters.

Prior to SaaS and subscriptions, the post-sales mentality did not generally include that same level of urgency. After all, in a six-month or longer implementation cycle, how much can one day really matter? The problem with that approach is that, if one day doesn't matter, then two days don't really matter, either, and the death spiral continues. This is not to say that the implementation teams and customers don't care. They most certainly do. But the nature of subscriptions and the always-impending renewal or chance to opt-out dramatically increases the urgency.

In the world of enterprise software, time-to-value is often measured in months because of the complexity of implementing the solutions. If you are selling e-commerce solutions or B2C, time-to-value is still relevant and important, but it may be measured in hours or even minutes. When I set out to download and start using the GoToMeeting mobile app, my expectation is that the whole process should take less than five minutes. That's not a lot of time for anyone so where does the urgency come from to shorten that to four minutes and then three minutes? It comes from one of two places: (1) the end user or (2) WebEx. If you aren't obsessing about time-to-value, no matter what business you are in, your competitors likely are and that will differentiate them. This is especially true in markets as they become commoditized. It's very hard for Citrix to differentiate their GoToMeeting product from WebEx to the general user, which means that everything else matters that much more—price, time-to-value, support, and overall customer experience. Those minutes matter. Obsess over them. Fight for them.

High Touch

Because high touch usually means high value, which almost always comes with higher complexity, we're usually talking about finding ways to shave days or maybe weeks off your implementation process. And although much of time-to-value in this scenario is about implementation, let's not let it get narrowed down to only that. It's not time-to-implementation, it's time-to-value. For vendors dealing with high-touch clients, your implementation team and your customer success team usually share this responsibility. It's almost never the case that project complete = value received. It's a huge step in the process, but there's always more work to do. This is where a CSM starts to earn his keep. Once he has a fully functional solution with which to work, he can engage the customer in starting to use it to solve the business problems for which it was purchased to solve.

One of the challenges created by this handoff is actually measuring when the customer receives value. It's fairly easy to measure how long an implementation project takes. There's a kickoff date and a project completion sign-off date. If the average time between those two dates for your company is 97 days, then you can set a target to bring that down to 89 days next quarter, and 83 the quarter after that. It's pretty easy to measure. But the term value is not as concrete, which is why you probably need to create a proxy for it. This usually means determining which parts of your product have the highest value and measuring whether, or how much, each customer is using those features. Or, it could be done via direct interaction with your customers: “Was our product used by every department manager to input their budget numbers for next year?” If the answer to a question like that is yes, assuming that's why they bought your product, then you've certainly reached the point of value. For many companies using the latest technology for customer success management, value could be measured by the customer's health score. Regardless of your method, if you are going to obsess over time-to-value, you need to find a way to determine and measure value. Not doing that leaves your customer success team and your company, hanging out to dry.

Low Touch

The low-touch model actually puts more pressure on time-to-value for many companies. That's because this is usually only a tier of customers, not the focus of the whole company. That means these customers are most likely buying and implementing the same product as your high-touch customers but most likely have not spent as much money on it, aren't staffed in the same way to complete the project, and didn't pay as much for the services portion of the solution. And, in many cases, their expectations are actually higher: “We're a small company compared to some of your other customers. Why does this take so long?”

One possible way to solve this challenge is to be much more rigid and prescriptive with this tier of customers in how the implementation and customer success processes work. You could define each step in the implementation process and define exactly what you will do and what is expected of the customer. When Step 8 is done, so is the project. The same with customer success—handoff call, 60-minute training session, 30-minute follow-up two weeks later, and then quarterly health checks. In between, lots of automated touches that bring valuable content to the customer at just the right time (remember, “just-in-time”?).

This is not usually the way you deal with high-touch, high-value clients, and there's most definitely some risk. But, by definition, you can't spend the same amount of time with these clients, so you have no choice. This also means that the chances of losing these customers are higher, and those expectations should be set throughout your company. It's not feasible to expect the same retention results with reduced time and attention. For all these reasons, automation becomes imperative if for no other reason than to get far more precise at forecasting churn. Again, the development of technology for customer success management can be of tremendous value here.

Tech Touch

Time-to-value still matters for your tech-touch customers as we mentioned earlier. What also matters is the complexity of your product. It's virtually impossible to deliver value quickly enough exclusively through technology, if your product requires more than (1) download, (2) configure, (3) use. But even if it is that simple, you'll need to take advantage of every possible technology trick to make that experience the best one possible for your customers. This is one reason so many consumer apps allow you to login using your Facebook or Google credentials. It shortens the time for a user to actually start using your product by skipping part of the setup/identification process. B2B companies have something to learn from this if only in driving the thinking about how to cut minutes out of the process.

We've also mentioned in-app guidance before, and that is highly applicable here, too. B2C products are often so simple that almost no guidance is required to get started. But B2B products, and some B2C products, are often just complex enough so that some kind of assistance is necessary to get a user through the process. Take Dropbox as an example. Far too many people have downloaded and begun to use it for there to be a team at Dropbox talking users through the process. The entire experience has to be technology driven, and it is. The website is set up for the exclusive purpose of walking you through downloading and then installing the product. Icons and messages tell you what is happening along the way, and then the first thing that happens after the install is complete is that a 10-page pdf appears in your Dropbox folder, providing instructions on how to start taking advantage of it. As that's happening, there's also an encouragement on the screen to move your first file into Dropbox. This five-minute experience explains everything we've discussed in this chapter: easy on-screen or in-app guidance to download and then install and, very importantly, pushing you to actually upload your first file. It's clear that the time-to-value clock for Dropbox continues to tick until the first file is uploaded. It doesn't stop when the download or the install is completed.

Obsess about time-to-value. You'll never be sorry you did, regardless of the type of product you deliver or the kind of customers who use it. It's on your critical path to success for your customers.