The HotLine Magazine Archives
For The Profession of Cloud/SaaS Product Support
By Mikael Blaisdell

There are vital clues and indications in the search strings that bring readers to The HotLine Magazine from around the world every day.  “What is the Definition of Customer Support?”  “What is the profitability of customer retention?” “Define the SaaS support model.”  “Usual customer retention rate for a SaaS company?”  “How to profit from SaaS support?”   All of these are indicators of the same fundamental problem.  Every so often, an inquiry comes along that goes to the heart of the issue and begs for an immediate reply.  “Fixing a broken customer support group” is a perfect example, prompting two immediate questions in return.  What do you mean by “broken?”  And how would you define “fixing?”  Almost invariably, the source of serious problems with a customer support group is external to the group itself; they are inevitably strategic errors.  Until the senior management team and the support executive or manager understand each other, and work together, producing a truly effective and lasting resolution for the broken group is unfortunately unlikely.

Defining “broken”

The typical definition of “broken” when applied to a customer support group is expressed as “the customers are screaming.”  The usual pain point is transactional responsiveness; customers are having to wait unreasonably (in their view) long times before being heard or until issues are resolved.  This scenario is almost always due to a simple lack of resources, or mis-deployment of those that are available.  The support staffing equation is straightforward: if you want calls/cases answered and/or resolved within a particular time frame, the calculation can tell you very precisely how many staff members you must have ready to respond.  Support professionals all know this.  Senior management members typically do not; the business and operational case must therefore be presented to them in order to get the appropriate allocation for staffing.

But the “broken“ descriptor may also be applied where the senior management team perceives that the support group is out of step strategically with the rest of the company.  Here, too, the communications issue is often a key factor both ways.  If the CEO and other senior executives do not have at least a basic understanding of how contact centers work to balance demand and resources, their ability to make effective decisions on overall customer retention policy and center budget allocations will be hampered.  If the Support leadership cannot talk comfortably about customer acquisition costs as investments, and show how customer retention costs are factored in to assure a continuing and profitable income stream, they are unlikely to be taken seriously by senior management.  The two sides of the conversation will end up talking past each other, and the probable outcome will not be good for anyone in the long term.

Developing a Complete Resolution

If the immediate problem is about a lack of resources and/or inefficient organizational structure / deployment, there are several available options for easing the pain.  Senior management readers should start with this brief article on staffing levels, and look at this case study (free registration & log-in required) where reorganization had dramatic results.   While there are effective steps that can be taken to bring improvement in the short-term, developing a complete resolution will require comprehensive effort.  The prerequisite is getting an accurate view of the situation, covering both strategic and tactical factors.    With the facts in hand, establishing an appropriate global policy regarding customer retention and profitability is something senior management must do, together with setting a workable budget.  It will then be up to the support team to effectively apply that budget towards fulfilling the retention and profitability goals.

“It’s what you don’t know about your customer relationships that can cause you to lose them.”

–The SaaS Customer Retention QuickStat

July 16, 2010