Why the Customer Success Role Is Critical in Field Services Management

In the field services sector, technology literacy is fairly low among veteran operators, making adoption of field services management (FSM) software a challenge for SaaS providers.

Some of this challenge is mitigated by the fact that a new generation of tech-savvy operators are taking control of field services organizations. Still, this new guard faces the hurdle of adoption by their employees who may not be ready to abandon the old way of doing business.

An additional challenge for FSM providers is dealing with natural attrition resulting from their customers going out of business or losing a significant source of revenue.

In light of these challenges, FSM providers need to make a strategic investment in customer success—a function that is commonly underdeveloped in a SaaS organization.

The "why" and “what” of customer success

The business goal of customer success is to retain as many customers as possible—a critical task given the hurdles of adoption and attrition.

In theory, customer success in FSM should look similar to the CS function in any SaaS company. Their responsibilities include:

• Onboarding customers
• Ensuring customers derive the most value possible from the product

In practice, CS managers should oversee a fixed book of customers and carry a quota to up-sell and cross-sell those customers for greater ACVs.

Land and expand

Given that technology adoption is a challenge among field service operators, a powerful go-to-market strategy in FSM is to "land and expand."

Employing this strategy, the FSM provider sells a flagship product that has a low barrier for adoption in order to get their foot in the door. Once the relationship has been established, the customer success manager then has a huge opportunity to increase ACV by selling other products to a customer who historically hasn’t used technology.

Proactive customer success vs. reactive customer support

In an effort to keep costs low, some FSM providers take a reactive approach to customer success, handling requests similar to a customer support function.

But the success and support functions should fulfill totally different needs for the organization, and therefore operate differently:

• Support should reduce product friction by addressing issues as they come up
• Success should educate customers about unused product functionality

What exactly does proactive customer success look like? Most importantly, the CS manager should have scheduled meetings with their customers at a regular cadence. These meetings provide an opportunity to highlight features a customer is not taking advantage of that could increase their utility.

Ideally, the CS manager should have access to product usage data that enables them to pinpoint areas where their customers could derive more value.

North star metrics for the customer success function

For each customer success manager, an FSM provider should track the following metrics:

Churn. Logo (or customer) churn should be below 10% to be considered best in class, though your ability to retain customers at this rate will depend on the size of your customer (i.e. SMB vs. enterprise). Net revenue retention should be north of 100%, regardless of whether you serve SMB or enterprise customers.

Product engagement. Keeping track of how often customers log in and what percent of available product functionality they use will help CS managers identify who is at risk of churning and who is in the best position for an up-sell/cross-sell.

Appointments set. Each CS manager should have a quota of appointments to set to ensure they are proactively meeting with their customers.

Customer Success -> Retention -> Valuation

As a founder, your ultimate goal is to one day make a successful exit from your business, and the maturity of your customer success function will impact the size of that exit.

While there are many factors that influence valuation, customer success directly influences net revenue retention, which is the SaaS metric most highly correlated to valuation.

In other words, the better you build out the customer success function, the better position you will be in for an outsized valuation and successful outcome in the sale of your business.