Customer delivery, customer success, and account management functions influence a company’s growth in various ways. The main focus of these roles is to nurture customer relationships. In a competitive and crowded market, companies must deliver an exceptional customer experience to retain their customers.
The three functions overlap considerably but have slightly different responsibilities: customer delivery focuses on delivering a product that meets customers’ needs, customer success focuses on maintaining loyalty, and account management focuses on maintaining and improving revenue.
In this guide, you’ll learn all you need to know about customer delivery, customer success, and account management. You’ll also learn how these roles connect to your company’s financial performance and reporting.
What Is Customer Delivery?
Customer delivery, also known as consumer service delivery or service delivery, is a strategy for ensuring your organization’s consumers get the most value out of your products, services, and interactions. Service delivery is important for building a strong relationship with consumers and enhancing customer experience.
A customer delivery professional helps improve delivery systems by implementing policies, values, guidelines, and principles that form the framework of customer interactions and satisfaction.
Important Customer Delivery Metrics
A customer delivery team focuses on measuring the effectiveness of service processes through:
- Service quality index: Allows the team to measure service delivery quality in terms of reliability, timeliness and customer satisfaction.
- Utilization rate: Monitors the amount of time workers actively engage in service delivery tasks, allowing management to evaluate productivity and manage resources.
- Backlog: Tracks the number of issues during a particular period that the service team still needs to resolve, allowing them to measure the team’s workload.
- Service level agreement (SLA) compliance: SLA compliance measures the effectiveness of the service process by evaluating how often service delivery complies with SLA principles and policies.
Customer satisfaction is another important element, measured through:
- Net promoter score: Allows customer delivery team members to measure how likely a customer is to recommend the company’s product or service.
- Churn rate: Measures customer retention rates by calculating the percentage of consumers who discontinue using a company’s product or service within a certain duration.
- Customer feedback: Uses surveys or reports to measure how satisfied customers are with the product or service.
Finally, customer delivery teams focus on overall performance by measuring:
- First response time: Here, customer delivery employees analyze and record the average time the service team takes to initially assist or respond to a customer.
- Average resolution time: Customer delivery calculates the average time the service team takes to resolve a customer issue or request.
- On-time delivery rate: The customer delivery team records the percentage of products or services the company delivers to customers on time.
What Is Customer Success?
Customer success is the process of ensuring a company takes all the necessary steps to keep customers happy and make sure their product or service meets customers’ needs. A customer success team could consist of Customer Success Managers, a Customer Success Director and a Chief Customer Officer. These teams build long-term relationships with customers and support them with onboarding, consultations, ongoing support and training.
A customer success manager advocates for the client by communicating to the in-house team how they can meet client needs, what will benefit the client, and whether any roadblocks exist. This function has increasingly become more popular, with more than 90% of businesses having a dedicated position for customer success professionals.
Important Customer Success Metrics
Your company can measure the success of the customer success team based on the following metrics:
Customer Retention Cost
The customer success team can calculate the customer retention cost to measure how much money the company spends to retain each customer. These costs include money for training, marketing, customer service and customer engagement initiatives. The team can calculate the customer retention cost per customer by dividing the total customer retention cost by the number of active consumers during a particular time period.
Customer Health Score
This score is an excellent metric for the team to monitor whether a customer relationship is healthy or at risk. Many companies create their own scoring system to track and predict the likeliness of a customer either ending, renewing or upgrading their relationship with the company.
Qualitative Customer Feedback
This non-numeric feedback gives the customer success team insights into how consumers feel about a service or product. This information typically comes from online reviews, social media and surveys with open-ended questions. The team uses this information to improve the product or service and how customers perceive it.
What Is Account Management?
Account management involves developing a strategy to increase account revenue and offers customers personal communication for any product, service or account questions. The primary goal of account management is to nurture customer relationships to grow each account’s revenue potential. According to statistics from a Zippia report, there are over a million Account Managers employed in the United States.
An Account Manager’s duty involves answering customer queries about product features rather than ones about daily customer experiences and meeting goals with the product. They are also responsible for identifying key accounts, upselling, expansion, subscription renewal and cross-sales. This role requires sales skills like negotiation and persuasion and customer service skills like communication.
Important Account Management Metrics
Here are a few ways your team can measure its success and evaluate its performance to improve:
Customer Outcomes
A customer outcome metric helps the account management team evaluate its ability to help customers meet their objectives by comparing the team’s effort with the outcome. Some outcomes the team might measure include signing up for a new service after a call with the account manager, attending a product or service launch event or requesting early access.
Customer Upsell Revenue Rate
The account management team can review its ability to build trust and loyalty by monitoring the increase in revenue generated from each account. The customer upsell revenue rate allows the team to calculate the organization’s revenue from upselling to existing consumers.
Organic Growth
This metric helps the account management team evaluate how well it generates growth with existing customers. This can include crossing-selling success, closing sales from customer referrals and influencing consumers to upgrade their subscription plans.
How Are These Areas Similar?
Before we discuss the key differences between these three approaches and their related departments, it’s necessary to note that there are instances where customer delivery, customer success and account management align and have common objectives. Here are three similarities these areas share:
1. Maintain Customer Satisfaction
Customer delivery, account management and customer success teams all work to ensure consumers get the best value out of the company’s product or service.
Like customer delivery, both customer success and account managers work directly with clients to resolve queries. Account managers may ask questions personally, and depending on what they need help with, they pass these requests on to the customer success or customer service delivery teams. These teams will also do the same if they notice the queries pertain more to account needs.
2. Communicate With Existing Customers
While their responsibilities may differ, one thing all three roles have in common is that they only work with existing customers. Account Managers, Customer Success Managers and Service Delivery Managers analyze and record different aspects of client interactions and needs and inform one another about the various metrics they gather.
3. Help Customers Use the Product or Service to Achieve Their Goals
Another similarity is that all three teams share the same high-level objective — helping consumers reach their goals by using the company’s product or service. As mentioned, these departments work together to maintain high customer satisfaction and retention rates.
What Is the Difference Between Customer Delivery and Customer Success?
As industries evolve, companies discover various areas where customer delivery and customer success overlap. When you look deep enough, you’ll notice there are distinct differences between these two departments. Here are three key aspects where they differ.
1. Areas of Focus
Customer Delivery Managers primarily aim to create an overall positive relationship with customers by evaluating and improving customer satisfaction and loyalty. Customer Success Managers meticulously assist customers with a specific product or service for long-term customer retention.
2. Responsibilities
Customer delivery applies solutions to all customers alike, manages the customer journey and analyzes key metrics like net promoter score and customer satisfaction. Customer success teams provide personalized customer assistance, ensure consumers get the best value from their purchases and evaluate metrics like customer lifetime value and retention rate.
3. Reactivity vs. Proactivity
Customer delivery teams are primarily reactive because they improve processes, satisfaction and performance based on the data they gather about aspects they should improve. In contrast, customer success aims to take a proactive approach by improving ways to reach customer goals before issues arise.
What Is the Difference Between Customer Delivery and Account Management?
There are various visible differences between customer delivery and account management. Here are three areas of differentiation between these two departments.
1. Areas of Focus
Customer delivery’s main goal is to support customers who use a specific solution and improve overall customer satisfaction. Account management works with a select group of customers with great account growth potential and encourages them to purchase additional products or renew their subscriptions.
2. Responsibilities
A customer delivery professional’s responsibility includes analyzing and managing customer experience processes to improve the effectiveness of service processes and the overall performance of products and services. Account Managers address account queries, make upsells and develop marketing strategies and sales reports to expand accounts.
3. Timelines
Customer delivery starts from the beginning of the customer journey to keep an accurate record of key metrics, while account management only comes into play when there is potential for account growth or specific account or product queries need to be handled.
What Is the Difference Between Customer Success and Account Management?
By gaining in-depth knowledge about account management and customer success, it should be easier to notice their differences. While both improve customer experience, these departments have different goals, responsibilities, skills and timelines. Here are four main differences between customer success and account management.
1. Areas of Focus
Customer success teams significantly focus on meeting the customers’ needs to maintain customer loyalty. Their main aim is to improve the product or service for the primary benefit of the customer, which simultaneously supports the company. In contrast, account management teams aim to influence account and revenue growth for the company’s benefit.
2. Responsibilities
A Customer Success Manager manages client onboarding and training, collects customer feedback through surveys, offers customer service to prevent problems before they occur, and talks to customer experience and product development teams about improvements they should implement.
Account Managers communicate with particular customers who have accounts with a large potential for growth and address product or account questions they have. Some other duties they have include tracking consumer information in customer relationship management software, developing sales reports and creating marketing strategies.
3. Timelines
Customer Success Managers become involved in the customer journey from the day the prospect turns into a customer and stay involved with them at every step. Account Managers enter the customer journey at times when the customer renews their account or subscription.
4. Reactivity vs. Proactivity
Customer success teams take a proactive approach to helping consumers by contacting and educating them well before they encounter any issues. On the other hand, account managers are mainly reactive. This means they only help consumers when they contact account managers about a query or need.
How Customer Delivery, Customer Success and Account Management Work Together
While customer delivery, customer success and account management have their differences, their work is highly complementary. By working together and gaining additional information from one another, these departments offer consumers an enhanced and memorable customer experience, encouraging customers to do business with the company long-term.
Creating space for all three departments in your company is an excellent move for influencing high company growth. An essential step here is to ensure all three departments communicate effectively with one another to meet customer needs and put the customer at the forefront of every decision they make.
Improve Customer Delivery, Customer Success and Account Management With Compass East
The right finance and accounting team can use some of the data generated by your customer delivery, customer success, and account management teams. The key performance indicators (KPIs) those teams use to measure success capture operational (non-financial) metrics related to things like retention rate, subscription numbers, and even client satisfaction.
Working with a partner like Compass East, those metrics can be aggregated and integrating into reporting and dashboards in your financial modeling. That allows you to track information and identify trends as well as have the necessary context for the numbers. For example, if customer churn is 8%, it’s hard to understand what that number means unless you know how it compares to churn in previous months or years.
Operational data can also be used to inform future forecasting. Many companies use a simple green/yellow/red system to evaluate their customer relationships. If you have too many customers who fall into the yellow or red, that might impact your revenue forecasting for future months because you may anticipate an increase in churn.
Functions like customer delivery, customer success, and account management are on the front line of doing business with customers and clients, and the information from those teams is valuable. At Compass East, we can use this data to provide an extra layer of insight and context, allowing our clients to make more accurate predictions and more strategic decisions.
Our finance and accounting advisory team uses scalable systems and processes to translate your operational metrics into financial impact. Contact Compass East to learn more.