Building a Commercial CS Mindset Without Breaking Trust

Hello everyone, thank you. You made it to the end of day one. Congratulations. We'll try to have some fun here and please do keep your hands on your phones right now because I'm going to introduce myself and then we'll jump into a quick poll to get a pulse of who is in the room.

So thank you Roz for the introduction. My name is Melissa Goldstein. I am part of MasterCard's services business and I'm the lead within our customer success center of excellence focused on building consistent approaches and CS operations across the wide array of products and services that we have within our business unit. We have many different products many different go-to-market motions and many different talent profiles and teams because we all know that customer success is part of a village around it in account.

So before we dive in please do pull your phones out and go to the Slido and we'll start to see results come up in just a moment. But the question here for you all is today we're talking about how your organization is structured in terms of whether customer success is a revenue-linked function, a cost center, hybrid, somewhere in between with some commercial responsibility or maybe you're still figuring it out. So we'll see the poll results coming in here and we'll see let's see. All right, so it looks like it's a tie.

Tremendous. So revenue linked with some with at least either commercial targets or some commercial responsibility. What I'm going to talk about today is how we at MasterCard have framed this with intentionality around our team being part of the commercial model from the get-go as we've been building our approaches out at MasterCard. And so it sounds like we're in good company in this room.

The other context that I will share as I dig in here is that what I'm going to talk about today is very focused on human-led customer success motions as opposed to scaled or digital motions. So with that context in mind, you heard it in the keynote this morning. The realities of our business environment mean that everyone is feeling the pressure to become part of our revenue-linked function and the question is how can we balance the true heart of CS as I see it in terms of usage, driving positive health scores and value realization with the ability to become part of the revenue organization, driving qualified leads at least if not retention and expansion outcomes. So the question here that we're going to talk about today is whether CS teams can own that commercial target without losing trust and focus on value that is the core of what we do in a success function.

So we're going to take four points here today. First, we're going to talk about how expansion follows success and what that means. Foundationally, commercial outcomes are earned through value delivery. Second, we're going to talk about value as the North Star.

Since we need to deliver value, how do we do that in a way that's compelling with our customers? Third, we're going to talk about some practical aspects of what we've learned and what I hope are helpful frameworks for you to think about how to apply in your enterprises as well as, and then finally, the last but definitely not least, how to build the ownership models and aligned incentives that help make this work in large enterprises. So with that, I first want to focus on what do we really mean by a commercial mindset, right? If it's commercial, maybe it's sales.

Is that true or not true? Right? And what we want to, what I want to relay is what we've found is that there is a really important scope that a CSM has full ownership and a really compelling reason to be part of the commercial organization. At the same time, there are things that are out of scope.

Right? So our CSMs have tremendous relationships and visibility into our clients' needs, business problems, ways of working, etc. How would we not capitalize on that to understand what are the next steps? What are the additional opportunities for expansion?

I will also say that provided that the commercial terms are clear or controlled by CS. This is an area where I expect questions later. It is fully relevant that the question was posed in the keynote this morning. Should CSMs own renewals?

For us, that's a resounding yes. I don't know how you answer that question differently today, but I welcome your questions later. And the CSM needs to be aware of and participating in the broader commercial strategy around the account. Depending on how deep and broad your product capability is, there are often broader account planning goals and approaches in play beyond the scope of the existing relationship.

The CSM needs to be aware of that context and can participate to the extent appropriate. What this does not mean is that CS is an adjunct sales function. We have found that there are bright lines that should not be crossed by a CSM. That means that CSMs should not be directly negotiating price or discounts.

In general, that breaks the trust that they have with customers. They should not carry quota for net new expansion or new buying centers, new contracts that would be signed. CSMs can't work in a vacuum. They have to have the full context and the ability to hand off with other teams.

They also can't have pressure on timing. Because a conversation at the wrong time, an expansion conversation at the wrong time, can absolutely harm the relationship that they have. So trust is the CSM's currency. And it's crucial that that trust is continued to be built and can be reinforced through owning retention and expansion conversations.

So if we believe that expansion follows success, what are the key principles that enable that? First, we just talked about it, right? Expansion is earned through trust. And when you demonstrate genuine investment in your customers' outcomes and have delivered value, your customers want to continue partnering with you and building that relationship.

Expansion should be rooted in existing goals. So we're not beginning new conversations that are different from how we had worked with the customer in the past. We're extending our role as a trusted advisor in continuing to build that interaction. And third, it needs to be time to readiness.

I think we've all probably in different roles experienced the pitch of I've just told you what does not, what is not working with me and how frustrated I am. How dare you try to upsell me right now? If that's the conversation that we're pressuring our CSMs to have, they are not going to be successful. And that is what detracts from the relationship that they have already built.

So if expansion follows success and success is very important, success and success is value delivery, how do we position value as our North Star in building and developing customer relationships? I'm going to first argue that value, we use the one word value to mean two distinct things. And at MasterCard, we've tried to be very explicit about both sides of that coin. There is value that you deliver to your customer, ideally through your products and solutions or via value-added services on top of your products and solutions.

And then there is value to your enterprise. In our experience, it's really important to separate those two things. The value that you provide to your customer is your product's value proposition. Right?

What happens when a customer adopts and uses your product? Do they save money? Do they make money? Do they save time?

Do they avoid risk? What is your value prop and how do you quantify it into economic value that is compelling for that customer that is using it? That's one thing. The other thing is what does it mean for you?

Right? What is your enterprise's return on that investment? And how do you continue to engage with that customer in a way that generates ongoing and ideally increasing value to your enterprise? These two things need to be inextricably linked.

They need to be two sides of the same coin. If you can't talk about both of them in the same breath, it is going to be very challenging for your CSMs to continue that narrative from value to expansion. Right? And so what this means is that this needs to be an enterprise-wide philosophy, though.

Your CSMs can't be the only ones talking about value. The value conversation should start in the sales process and should be focused from the get-go on how does not just features, but what is the value journey look like for a customer? Your product ideally will include ability to quantify and see value over time as the user adopts it. And your go-to-market needs to support the ways that a CSM can encourage expansion.

It has to be easy for the customer to expand with you as opposed to having a lot of friction in upsell, on-sell, cross-sell motions. So it's easy, right? We just talked about how to do it. Is it easy?

Maybe not. So we'll come back to some of the points on the slide. But first, get the phones back out, and we want to move to a poll to hear from you all what is the biggest risk when you start to move in this direction? When you start to move towards commercial targets?

Is it prioritizing enterprise revenue over your customer outcomes? Sort of fear that the commercial pressure corrupts your success mission? Is it delivering value but failing to capture it commercially? Customer is happy.

Nobody knows what that means. Is it losing the trust that makes CS effective? Any commercial conversation means that the CSM can't have the right conversation or relationship with your customer? Or is it misalignment?

An internal friction that prevents those people down or prevents the right things from happening? Let's see. So this is a little surprising to me, honestly. But the if really the problem is internal and not with customers, I think that's a really good thing for your businesses.

That means that you have the right customer-facing approach, and hopefully it's easier to work on internal alignment than it is repositioning your product to have more concrete and economic value. But it's interesting that second place is prioritizing enterprise revenue over customer outcomes. That's what I expected to be first here, is focus on internal gain over customer outcome. But good to know that the internal pressure is there.

We'll talk a lot more about that in just a moment. All right. So we talked on the last slide around making visible the value that your product creates. I want to double click on that.

Because one of the things that we found as one of our most critical investments is focus on value quantification tools and materials that enable our CSMs. So before I go into this, building this kind of material is not generally our CSMs competitive advantage. So for us, it requires a more technical background and different tools than our CSM use. I'm not trying to suggest here that your CSMs should be building these tools, but they should be leveraging them every single day.

Right? And so what do we mean by value quantification? We need to understand what the customer gained, what cost did they avoid, what revenue did they generate, what risk did they mitigate, et cetera. And how does that drive economic value for the customer's business?

The more dollar signs that can be in here, the better. Right? We have to speak the CFO's language, and we can't be afraid of placing an ROI on the investment that a customer is getting from us. They are paying you money.

They should and can expect to understand what is the ROI of that investment. So as you then are able to quantify that and provide ongoing updates as to value creation and white space opportunities. Right? What is the value of optimizing or increasing their usage?

Adding on a new and related capability. All of this positions you to be able to have that expansion conversation in a value oriented way that avoids the hey, have you thought about product X? It's instead we see what you're doing today and with product X you could generate this additional ROI. Right?

That's the expansion motion that is natural as an outgrowth of a success motion. And so, but it's not enough just to give our CSM's numbers. We also need to give them materials. And the one thing that we've found in building this type of content is it's really important to test it.

It is one thing for what you think is going to be compelling with customers. It is another thing when you start to put those materials in front of customers. And again, this is a place where there's risk in eroding the trust of your customers. If you try to give them a value quantification that does not make sense to them, they say, okay, you're blowing smoke.

Right? You need to test these materials out, make sure they're compelling so that as you and give your CSM's the ability to modify, customize, tailor the materials so that when they take them to the customer, it truly resonates and the customer is bought in. All right. So this is on the how to make value visible perspective.

And then in terms of the go-to-market, we think a lot about how customers should adopt our products and taking friction out of an onboarding workflow. We don't always think about taking friction out of our go-to- market. Right? Once you acquire a customer, have a certain footprint with them, what does it take from them to expand that footprint?

Old world, maybe seats or that sort of thing. But if there are additional low ticket upsells, whether they're additional features, additional capabilities, things that you can turn on, really making sure that that expansion experience for the customer is frictionless. They can click to buy or otherwise sometimes self-serve. An upsell is the dream.

Right? And second is having the appropriate professional services and linked implementation offerings so that if a CSM has a conversation with the customer and hears, you know, yeah, we'd love to increase our adoption, but we just don't have the resourcing. What can you do about that? Can you offer staff, can you offer additional hands-on help, SME support, et cetera.

Having that built out so the CSM is not inventing for themselves in each scenario is a really good way of enabling CS to create those expansion opportunities. And then on the bottom here, identifying what are those triggers. Right? The CSM is having the conversation, understands the business issues that are live with the customer.

They need to be able to map those, excuse me, to expansion opportunities. Right? Make sure that they can know what to do with that business issue and not sort of fumble through it with the customer. They should be enabled on that front, including the collateral.

Right? If you can have use cases and case studies and value stories built of actually there was another customer in your exact situation. Here's what they did. Here's the outcome that they saw.

In my experience, it doesn't have to be named. I think sometimes we focus more on named case studies such that it's a compelling logo on the slide which prevents you sometimes from being able to tell the true story with the customer. So making sure that your CSMs have that information. Now, you didn't think you were going to get through this whole presentation without me saying AI, did you?

Hope you didn't. Obviously, there's AI opportunity here. Identifying those triggers unless your product is very new. You probably have history of how expansion paths have worked.

What were the trigger items? How do we map that out for CSMs? And then personalized content is obviously really important here. So use AI smartly in everything that I'm saying.

Including how we equip CSMs. Right? So we talked about we're asking CSMs to step into these value-oriented conversations. They don't always have that as part of their baseline skill set.

And so these are four things that we found to really help our CSMs talk about expansion. First is business problem discovery. Help them be better interviewers. Understand especially for those business issues that are triggers to expansion.

Help them understand the customer's needs and scope in that area. Second is executive outcome language. Our CSMs need to be comfortable and confident talking about dollar signs and ROIs. If they're not, get them there.

Again, use AI to coach and practice and role play. It's a great way to build comfort in this area. Third is identifying those readiness signals. Again, if you have the playbooks written, great.

If not, get the CSM to help you write those playbooks. And fourth is CS is not on an island here. Make sure that your CSMs know when to pull in specialists, product specialists, renewal specialists, solutions consultants. We have a wide variety of additional roles nearby to CS and make sure that if the CSM hears, oh, yeah, I do have a need, who can help me with that?

The CSM knows where to go. And that person is expecting to be pulled in in that scenario. So that brings us to, but what if the CSM is trying to bring in a partner? How do we clarify roles and ownership in this process?

And so we'll spend a little bit of time here. So what we've found is that CS should own value realization both for the customer and for the enterprise. Both. Not one or the other.

Not focused on internal revenue. Focused on both customer revenue and revenue to your enterprise. That includes whatever it should include in your business and our business. It includes things like upgrades, cross-hills, qualified lead creation, but also the outcome and the actual achievement of that expansion, risk mitigation and saving revenue that would otherwise be lost, as well as win-backs of lost features or relationships when appropriate can be in the CS team's responsibility.

And renewals with clear commercial engagement where it's not an open price negotiation is in the CS responsibility. BD, sales account management, et cetera, whatever it's called in your organization, is focused on net new logos, hunting, and net new expansion. That can be hunting even within the same organization. It's a new buying center, unrelated or a product or service that is unrelated to the current footprint.

The BD organization is also accountable for the full account size. And growing that to targets or objectives. Including closing qualified leads. As qualified leads are created by CS, they become part of the account owner's responsibility.

And our leadership team has really focused on trying to make those incentives align appropriately. We'll talk about that in a moment. As well as defining those handoffs and trying to resolve the gray areas. This is not cut and dry.

And we don't want to pretend to our teams that there is always going to be a cut and dry division of responsibility here. We want our leaders to be present in helping to assess these gray areas. And hopefully if the leader has the trust of their team, relying on that to make sure that the team believes that they will get appropriate credit and incentive applied based on the work that they truly put in. Especially in the more ambiguous circumstances.

And building out that vision. It's leadership's responsibility to build out the vision of how all of these teams work together. So, for a few examples. Sorry, before I go to a couple examples here.

In terms of controllability, often we think about what's in the employee's control when we design incentives. In our view, we have really leaned into it is still the outcome that must be realized. We can't just say, well, we had the usage, it's really a shame they didn't renew. That's not good enough.

We are accountable just like if a seller pursues a perfect sales process and the deal doesn't close, the seller doesn't get paid. If we do all the right things but the account doesn't renew, that is still hurting our business. And our goal is that the CSM can make it up elsewhere. Right?

That is, but we are, we feel that we should be fully accountable for the revenue outcomes. That doesn't mean that there's not exceptions to that in cases where products are sunset or other decisions are made. Right? You still have the ability to address whatever that situation should be.

And then in terms of incentive alignment, we are trying to avoid pure overlap in incentives in the sense that CSM and the business development teams are perfectly accountable for exactly the same thing. We don't believe that is good incentive design. However, there are ways to manage where overlaps should exist. So an example is where a renewal becomes a really big upsell opportunity that is going to need to be negotiated and turns into a 10x deal size.

That's great. And we want our CSM to flag, hey, I really want sales support on this one. So that deal can be added to the seller's incentive as well. Sorry, the seller's quota.

Such that in that case, the CSM and the seller do share in that outcome if they're able to increase that deal size as expected. Right? But that's more on an exception basis as opposed to the rule being the CSM owns the renewal except where they need to trigger and pull in BD for support. So I'm sure we'll have questions on that front.

But in terms of wrapping up where we are here, the key takeaways here are that we don't want CS to become a sales function. We want CS to own appropriate commercial responsibility without breaking trust. And that means that we follow the value and the natural expansion that comes from creating customer value. Such that our go to market helps us to build out, you know, helps us to grow that relationship appropriately.

We need clarity on roles. We need to make sure our CSMs are equipped for executive conversations and able to talk about the economic value that products and solutions bring. And we need to make sure that we are rewarding the right behaviors that do truly bring in the economic value that our business needs in order to survive. I want to leave you with, we talked about trust throughout here.

It takes a long time to build trust. And you can shatter trust very quickly. And so making sure that CSMs see that as their relationship capital. And are not pressured to do things that detract from the trust that they build with their customers.

But at the same time, we're in a business. And we need to make sure that we are bringing our staff and our employees along in creating and building a sustainable long-term business. And we believe that you can do both at the same time. But we'll open it up to questions and talk a lot more about some of the things involved here.

[Applause] A question just for my brain. So the CSMs, do they have a quota for upsells or is it just renewals? It depends by team. So based on, so we deal with several different teams.

Some have growth targets. It's commensurate with the overall business goals of the product or solution that the CS team supports. Gotcha. Perfect.

What's your approach for how CSMs should own renewals without talking price negotiation or discounts? It's like I told you to ask a question, then you did. Thank you. So this is another, of course, it depends.

Some renewals are quite straightforward. The terms are set. There's already either an increase built into the contract of an expected increase amount. Sometimes that is waived for early renewals.

There's pretty standard approaches in these areas. And where there are well-defined criteria for CSMs to use in negotiating a renewal, we believe that they can do that. If they can talk ROI of what the customer already has, they can own that renewal conversation. If the customer says tear up the old contract, no, we got to start from scratch, something has changed.

Okay. That becomes a nonstandard renewal. Right? And that is a trigger to go back to the drawing board, involve someone from the business development organization, et cetera.

But where there are defined parameters on what's allowable and those existing and relatively standard terms, that's where a CSM can own it. When it comes to the CSMs, can you, I guess, walk me through a little bit of the process of them helping the BD team kind of uncover these opportunities in terms of discovery. Are they talking about pricing there or does that part fully fall on the sales team? Of course, it depends a little bit.

But where some on-cell products and solutions are quite simple. It's a report. It has a cost. That, the CSM, can explain quite clearly.

If the on-cell is a consulting engagement that needs specific scoping and needs to be customized to the specific customer's situation and you're going to have to write a new contract, you bring in BD. Right? And so what we train on in terms of handoffs are around, you know, I heard a need. Either I can recommend exactly how to accomplish that or let me bring in this specialist who can help you learn more.

And especially taking that latter approach where the pricing is going to be complex or open-ended. Okay. What are the key KPIs that are owned by the CSM in a sales-centric org? How do you balance GRR, NRR, ACV growth and the multitude of other leading indicators?

Great question. We have chosen to focus on NRR to emphasize the importance of expansion. We're in a growing business. We are lucky to be in a growing business.

And we want to emphasize the net size of that relationship over time as opposed to retaining what we have. And so as a customer's needs change and migrate over time, as long as we're growing, that's okay. Right? So that's one of the ways that we've chosen to prioritize.

ACV and contract length and locked revenue are obviously also a consideration. And so those do come into play depending on, again, the structure of the deals of the team in question. MasterCard is transitioning to a variable incentive plan for CS this year. For teams that are earlier in that journey, what's one thing you wish you'd known before tying CSM compensation to commercial outcomes?

Great question. I think I would have wanted to... I think, well, the real answer is better ability to set the expectation on where sort of the growth needs to be such that we can really enable more on what we talked about earlier in terms of those value quantification materials, the go-to-market readiness in those areas, the playbooks on how to achieve those expansion opportunities. Those are things that we found are really important.

And you always want to have in place before you embark on this journey, or at least an idea of how you're going to get there because the CSMs need them then in order to achieve the variable compensation goals. I know you talked about this a little bit, but have you found that CSMs are given adequate training to help do discovery, promote new products like a salesperson would be, or do you think CSMs should more organically dig up these ops without certain info needing to be shared with the sales contact in a CSQL? I believe that CSMs should have overlap in their training with sellers. Any customer facing staff should have good interviewing skills, good ability to actively listen, ask follow-up questions, be curious, and understand that linkage of business issues that drive performance and value for the customer.

So we have now some overlap in what we recommend for CSM training, capitalizing on already built out sales trainings, especially around these more fundamental skills. We don't expect our CSMs to have all of the same skills as a seller, but especially on these fundamental conversation skills, it's really helpful for them to have that same basis. We've touched on it a bit, but where is the line drawn between CS cross-sell, up-sell, and AM selling generally speaking? How do we manage role overlap?

And if we're also held accountable for outcomes and revenue, how do we balance this? Yeah, it's a good question that I think is going to vary based on your particular situation. Two things that have really made a difference for us are, number one, the ticket size. If you have smaller ticket items in your go-to-market that the seller frankly isn't always going to care about, those are good ones, but they are really fundamental builds to an existing footprint.

Those are good ones to be on the CSM side of the house, and really it is being in tune with the prioritization of what the sales team is focused on. Often there are priorities internally that focus sellers on certain solutions as opposed to others, and being aware of that broader context can really help you determine where those lines should be drawn and how to delineate those responsibilities across your teams. Okay, how are you surfacing the client's ROI and expansion potential that you talked about, and then how is this being shared with the CSMs? Yes, so this is something we're actively working on right now.

We have a very complex product set, and mapping what is currently on board with a customer versus what are those white space opportunities is something that we are trying to make easier for a CSM to see. There are some ways for them to see it, but that is really important, and then being able to trigger that next best product, next best suggested opportunity based on what we know about, ideally if you're using tools that bring together your intelligence about the conversations you're having with the customer with those playbooks and cross-sell motions that tell you where there's good synergy between what the customer is focused on and what products and solutions we have to solve that problem statement. Hey, I mean that's the goal, right? Semi-related to a previous question, but are you currently tracking when CSMs are bringing sales ops or, yes, opportunities up in conversations or is it only tracked if an opportunity gets created and kind of do you use CSQLs as almost a justification, if you will, for CSMs creating revenue instead of being a cost center?

Yes, so we do use CSQLs. We also have a process for CSMs to track value that they create, even if that value hasn't been realized yet. So if they recommend a product or solution, they can start that and show that that has been part of their conversation. If it doesn't close, that's okay.

That is also life, right? But we encourage not only the CSQL to go to the seller to prompt them to evaluate it and pursue it if relevant for them, but also it allows a CSM to sort of note and have on the record that that product or solution has been brought up to the to that customer and what the reaction was. Perfect, and last question. You mentioned that at MasterCard, CSMs own renewals and also own expansions for current product footprint.

What are business models where the CSM role should not be the case, like business with large enterprise customers? Yeah, so that's an interesting question. So at MasterCard, not all products have renewals. Some products are always on, more consumption-based, etc.

So in large enterprise situations where the account manager really does have the full relationship purview, I guess that might be a case. But I think in my experience, I think it should be the exception and not the role that the CSM does not own a renewal, if I said that the right way. The CSM should own the renewal except in exceptional cases, but we haven't run across a lot of those. I think one area where there sometimes is overlap that needs to be delineated is where multiple products and solutions sit with one buying center.

And if you have different teams engaged with that same buying center, you do need to manage that quite closely. But again, that's a exception rather than the rule kind of situation where we trust our leaders to engage with their teams and find the appropriate solution for that case. Perfect. Well, Melissa, thank you so much for your time.

Thank you all for joining. Once again, please take the time to fill out that after session survey that you'll find in the Pulse app, and we will see you at the Pulse party tonight at 7.