Losing Your Executive Sponsor without Losing Your Customer

March 13 2020 2Comments

An executive sponsor or champion is a critical asset for successful and organization-wide solution deployment and adoption. Executive sponsors leverage their deep understanding of the organization’s ecosystem to support your platform’s selection and implementation despite other alternative solutions. They can also align and educate relevant teams and top executives with the benefits of your solution, ensuring customer success as they do. As beneficial as they can be, the exit of a champion is one of the most common reasons for churn in SaaS companies for many reasons. Some of these reasons may include:

  • Late notification for executive sponsor’s departure
  • Little or no perceived value for the product
  • A replacement executive with a preference for an alternative solution
  • Insufficient engagement with other decision-makers in the company
  • Lack of proactive and reactive playbooks for sponsor departure

In these situations, there are proven approaches that can cushion the impact of an executive sponsor’s departure. Use these solutions to develop playbooks that prevent churn before and after an executive sponsor leaves your customer’s company. This approach can also mitigate downsells and create opportunities for expansion.

Proactive Measures to Mitigate Churn Before an Executive Sponsor Leaves

Reacting to the exit of an executive sponsor is usually less-effective especially when replacement executives are eager to make changes. Surviving the transition requires laying the appropriate groundwork and leveraging your champion’s relationship to create more advocates that understand your value.

1. Set Clear Expectations

Emphasize the need for ongoing engagement from executives during the sales and onboarding process. Set expectations for this engagement and clearly define the roles and responsibilities of executive sponsors. You can request participation from executives or key customer contacts and reinforce their roles at QBRs, assessments, and across other touchpoints. 2. Connect with Multiple Executive Stakeholders One of the best ways to proactively mitigate the risk of champion loss, churn, and downsells is to establish relationships with other key executives and users in your client’s company. Start by identifying strategic personas that influence the decision to renew and task your CSMs to acquire them as sponsors. These personas may include:

  1. Power users
  2. Team managers who can promote adoption
  3. VPs of functions that use your solution
  4. CEOs or COOs that directly impact your buying decision

CSMs can gain more strategic sponsors at QBRs by simply asking or suggesting who else should be involved. Ask your existing sponsor to suggest and contact other personnel who are in the right position to access your solution. CSMs should work towards a minimum number of these sponsors per customer organization. Single-threaded relationships create a single point of failure and if the executive sponsor leaves, all preliminary advocacy efforts have to be done all over again. Establishing multi-threaded relationships creates an opportunity for other executives to take responsibility if a champion leaves the company and it is a better source for collecting information about customer goals. 3. Leverage Executive Sponsor Programs Identify sponsors from your organization that is best suited to maintain the relationship with your champions at your customer’s company. Aligning your company’s executives with your customer’s executives is called an Executive Sponsor Program. Your CSMs, Account Managers, and other top-level executives can be mapped to your executive sponsors depending on their account segment. For instance, you can map your CEO to sponsors in enterprise companies and map your Customer Success Managers and Directors to SMB and mid-touch customers. These one-to-one relationships create strong bonds between your organization and your customer’s organization. 4. Demonstrate Value To demonstrate value, you must meet customer needs, which requires understanding their expected business outcomes. Identify these outcomes and pain points early during onboarding and track your impact over time. At the early stages, you can improve your client’s loyalty to your solution through testimonials, case studies, “aha” moments, and a differentiated customer benefit. As you deliver value, ensure that the results are communicated regularly within your customer’s organization. If the results are not satisfactory or outcomes are not being met, identify the problem, and update your strategy. Keep your customers informed of the new plan and use task/alert features on your CS platform to ensure full cooperation within your organization. Send contextual progress reports, research reports, and relevant blogs to your sponsors to prove value and create top-of-mind awareness of your solution. Demonstrating value to multiple key executives and users will generate multiple advocates and ensure your solution has a high perceived value across the organization. This reduces your reliance on executive sponsors and sets the basis for the continued relationship in their absence. 5. Review Executive Sponsor Relationships Routinely review the number of sponsor relationships you maintain in your customer’s organization and use this as part of your health score. Use Groove and Salesforce to track the engagement metrics of your executive champion with your team. You can also leverage technologies like Nudge to evaluate the strength of your relationships across different organizations. Your CSMs perceived relationship connection should also be factored into your health score. 6. Detect Sponsor Changes Track your champions to quickly detect changes. You can monitor these key contacts using platforms like Gainsight or FullContact that track LinkedIn Profiles. In case the sponsor does not update their profile immediately, you can also monitor email data including bounces and unsubscriptions to detect who may have left. The most efficient way, however, is to maintain good relationships with the executive sponsors, so they notify you ahead of time.

How to Mitigate Churn After an Executive Sponsor Leaves

An executive sponsor’s departure should always be seen as a red flag and resources should be allocated to mitigate churn and downsells. If the sponsor is replaced, a good starting point is to demonstrate value to win over the new executive. The worst-case scenario is that the new executive prefers your competitor’s product. In that case, there are a few actions that can be taken to gain the support of the executive in the time it takes to make the switch. 1. Schedule a Meeting Schedule for an on-site meeting with the new executive to demonstrate the consistent value delivered by your product. Revisit your client’s pain points and mention how you’ve alleviated them. You can use the cost of transferring to a different product as a deterrent to churn. You can also receive updates to the new initiatives and business goals, introduce new capabilities, and set strategic goals for the next EBR. 2. Leverage Former Relationships The departing executive sponsor understands the state of the company, the perception of your product, and other beneficial information. Use this information to develop a strategy to approach your customers. You can also request your former champion to hand over the relationship and solution to the new executive. As a longtime user of your SaaS, the departing executive can also be an advocate for your solution in their new company. 3. Leverage Existing Advocates If you already have a network of advocates, leverage it to introduce your CSM to the new executive. Your advocates can be instrumental in proving your value so keep them well-informed.

Summary

The departure of a customer executive sponsor is a customer success risk factor, but it doesn’t have to mean the end of the line. Preventive measures such as acquiring multiple sponsors and demonstrating value to them can set the stage for a continued relationship even if a major sponsor leaves the company. When the champion has left, reach out to them quickly, prove value, and leverage existing advocates to forge a strong relationship with the new executive. Contact us at CSM Practice if you have any questions about executive sponsors or other customer success topics.

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Written By:

Irit Eizips

Irit Eizips brings deep expertise in the area of Customer Success. As an early member of Gainsight's executive team, Irit has been pivotal in shaping Customer Success methodologies and best practices. For the past 3 years, Irit has been voted as a top Customer Success influencer and is frequently featured as a speaker at conferences and Customer Success public events. Irit serves as CEO for CSM Practice, a global Customer Success consultancy firm. The firm specializes in working with customer success leaders to accelerate the creation and implementation of Customer Success strategies, derive extensive value from Customer Success technology solutions as well as certify and train customer facing teams in becoming more proactive and efficient.

2 comments

  1. […] Losing Your Executive Sponsor Without Losing Your Customer– The exit of a champion is one of the most common reasons for churn in SaaS companies for many reasons, learn how to prevent that from happening.  […]

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  2. […] Losing Your Executive Sponsor Without Losing Your Customer– The exit of a champion is one of the most common reasons for churn in SaaS companies for many reasons, learn how to prevent that from happening.  […]

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