The Rise of the Chief Customer Officer

As more companies come to understand that there is rich, untapped value in existing customers, a growing tendency is to establish a new C-level position, the chief customer officer (CCO). Most realize the potential offered by existing customers, but few have acted in a systematic, comprehensive way. Those that have are calling it out as a distinct C-level responsibility to establish goals, metrics, monitoring, and unified leadership. Sometimes this becomes a specific responsibility of the chief revenue officer, but, increasingly, it is being distilled as its own function under the CCO.

While leadership is being formulated, functions are coming together. There are many reasons that have contributed to the rise of the CCO. There are also factors to consider in making the CCO an effective role.

First of all, customer success (CS) is getting increasingly independent and is no longer captive to another organization, such as service, support, professional services, or sales. Breaking customer success out as its own function within an organization enables business professionals to more easily cross organizational boundaries while not being bound by the goals and objectives of a single one. For instance, when customer success is a part of support, its primary focus might be to reduce the number of support requests and trouble tickets. This might not be to the exclusion of all else, but it might reduce the ability to understand and champion customer goals or truly listen to the customer and convey the information internally.

Customer success, standing on its own, is more free to listen to customers without prejudice and proactively ensure  customers' own success. It can better gather timely input and uncover opportunities for increased revenue. Even so, some companies have admitted that a separate, distinct customer success organization is not without its difficulties. Sometimes, it cannot effectively act through other organizations or faces a herding cats problem of aligning internal expectations and priorities. Having a CCO can bring cross-functional alignment and authority while driving better results and enabling more strategic impact. One success factor for the CCO is to align customer success organizationally so it can fulfill its broader potential. Having customer success report to the CCO might be especially helpful.

Customer success and customer experience are starting to come together. Customer experience has often dwelled on assessing how a product or service is regarded by a customer in the truest sense—that is to say, in a vacuum. There is a growing understanding that companies should look to the full impact of what their product does or fails to do for the customer by more fully considering the value it provides and the role or function that it fulfills. Questions such as how the product helps a customer to meet his goals, how well the customer understands the product or service, and what it can provide should be among those being assessed. These are far more crucial factors than just knowing how well customers like product features and other attributes.

The integrated and intensified value of establishing a CCO results in multiple values. First, companies can better anticipate and understand churn and curtail or reduce it. Customer loss or reductions in renewals of service contracts or software services is extremely costly. Not only is this an immediate hit to revenue, but it is also damaging to the company reputation and investor confidence. Through the leadership of the CCO, customer success and customer experience can be better integrated and make a greater impact.

Companies can better uncover opportunities for revenue expansion. To be sure, this is often a function of sales, but the reality is that many sales organizations are more tuned to winning new clients and the next big deal rather than paying close attention to existing customers. Even when sales does attend to its customer base, it could be looking at opportunities quite differently than a success/experience organization that tries to put the customer first and is geared toward careful listening and understanding and advocating customer goals. This CCO organization can help lead sales to incremental revenue opportunities at the right time and in the right way.

Similarly, under a CCO, companies have greater chances to produce super customers who can spread positive word of mouth and provide specific referrals to prospective customers. Again, by putting the customer first and not being encumbered by internal purposes, a customer team can ensure the success of each customer. This results in a substantial increase in good will, advocacy, and willingness to help the company in return for what they have received and experienced.

Finally, under a CCO, it is easier to collect important information, distill or integrate it, and deliver it to the right internal department or division. Sometimes there will be vital product usage insight or details to convey to product management or development. There might be ideas for new products or services or, perhaps important details on competitive offerings. There might also be valuable information for marketing to better understand how to reach prospective customers or market to existing ones. The CCO can help ensure that the information can be operationalized and prevent it from slipping through the cracks.

Successful companies are establishing the CCO function in the pursuit of excellence, achievement, and strategic growth. While much of this is new territory, and strategies, disciplines, and mechanics are still evolving, the future seems bright. A new era for customer-centric success is just starting to emerge.

Shreesha Ramdas is senior vice president at Medallia and general manager of Strikedeck, a company he co-founded prior to its acquisition by Medallia. Prior to Strikedeck, Ramdas was general manager of the Marketing Cloud at CallidusCloud, co-founder of LeadFormix (acquired by CallidusCloud) and OuterJoin, and general manager of Yodlee. Ramdas has led teams in sales and marketing at Catalytic Software, MW2 Consulting, and Tata and also advises startups on marketing and growth hacking.