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As cloud companies feverishly focus on making their customer engagements a worthwhile experience, many cloud solution providers seeking to deepen ties with their clients are appointing chief customer officers.
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It's no secret that keeping existing customers and luring new ones to a cloud provider's business is key to profitability and sustainability, but an added burden for cloud companies, particularly smaller firms operating in a highly competitive market, is finding a strategy that enriches the customer experience year after year as they attempt to add value to a subscription-based model.
"If your business model depends on renewals, you're always selling," said Corinne Sklar, global chief marketing officer at Bluewolf Group LLC., a global consulting agency and Salesforce partner based in New York.
Sklar said once a company starts to use a cloud provider's services the sales cycle becomes more complex, as companies integrate its offerings into their processes, experience what it's like to call customer support, address a billing problem and adopt a new piece of functionality. Sklar said she has been advocating for the creation of a chief customer officer (CCO) position at Bluewolf.
"A customer is suddenly engaging with every department and it takes a chief customer officer to piece all those customer touch points together, show what the customer experience is today, and also define what it should be," Sklar said.
Under these conditions, the chief customer officers' role requires them to provide feedback to their C-level colleagues about their customer's experience at every stage of a project engagement. Chief customer officers must also devise a customer-centric strategy that drives efficiency and profitability for themselves and their customers.
Cordell took up the position as CCO in late September 2015 and is Kairos' first CCO. According to Cordell, one of his most crucial tasks is to close the feedback loop between the company's partner, Salesforce, and Kairos' customers, as well as the engineers, program managers and other Kairos employees working on any given cloud project.
With the goal of identifying customers' needs as the basis of improving the product Kairos delivers, Cordell said an important part of his job is to inform his company's executives about complaints or compliments that customers and partners share with him.
"If we don't garner this new found knowledge and feed it back into our corporate mind-hive and use that information to improve training or craft case studies around customer success stories, for example, then that message or that experience tends to die with the project and we don't get the long-term benefit of improving our business operations," Cordell said.
Chief customer officers: 'Critical' hires
Even more compelling, however, is that the CCO is uniquely positioned to forcibly inject a customer's needs at strategic decision points during a project engagement, said Curtis Bingham, founder and executive director of the Chief Customer Officer Council.
Bingham said chief customer officers can gather a wealth of information from customers about their company's performance by asking critical questions such as: How is our customer measuring our value? Are we achieving that expected value? And, are we providing experiences that are going to change customer behavior?
"In a highly competitive environment where customers have a huge choice and the risk of losing customers and having them describe their experiences to others is very high, it is imperative to understand the customer decision-making process at a greater level," Bingham said. "To ensure the customer relationship is not left to chance it's very valuable, and even critical, for a cloud company to have a chief customer officer."
Bingham said the CCO position creates a powerful competitive advantage that allows cloud companies to think imaginatively about how they can involve their customers in creating better products and services.
"The most engaged customers will innovate and co-create. They can help cloud companies develop new products and services that can differentiate them in the marketplace," Bingham said.
Curtis Binghamfounder and executive director of the Chief Customer Officer Council
At Mattersight Corp., Brian Study was appointed the software as a service company's CCO in November 2015. Mattersight, based in Chicago, hosts customers' data in its data center and provides behavioral analytics offerings for its enterprise clients. Study is implementing processes and procedures that will create an actionable view of a customer's health by evaluating each phase of a customer's project engagement such as the deployment experience, indicators of product usage, return on investment, relationship status and customer feedback.
"One part of the CCO's job is making sure the organization is actively listening so when customers express issues they have a built-in advocacy organization beyond the sales team," Study said. "Typically the CCO's primary job is to make sure the customer is satisfied and the customer's experience is a good one so they continue to be a customer."
Study said one important goal for him, which should be important to every CCO, is involving customers in driving new innovation, giving them one more reason to feel they are getting value from the offering.
In the case of Mattersight, innovation means using behavioral analytics to uncover insights and actionable information that is used by companies to improve their business operations, capture new market opportunities and elevate the customer experience.
"In a subscription model, customers won't pay the same amount year in and year out for the same solution," Study said. "If your solution doesn't increase the value delivered each year, customers are going to demand a price cut, your margins will erode and your company's revenue will decline."
Centralized vs. distributed responsibility
But even as cloud providers are heralding the attributes of the chief customer officer position, others have their doubts.
At Rackspace, a managed cloud computing company based in Windcrest, Texas, that partners with Amazon Web Services, Microsoft Azure and others to provide customer offerings, Taylor Rhodes gave up the CCO title to become president of Rackspace in January 2014, and Rackspace has not backfilled the position.
"We sometimes joke that asking who is the chief customer officer at Rackspace is sort of like asking a school of fish which one of them is the chief swimming officer," said Julian Lopez, director of customer loyalty at Rackspace.
Lopez also noted customer service is not limited to one individual, but is the responsibility of each company employee.
"It's the responsibility of every leader at Rackspace -- whether in engineering or finance or legal -- to make sure their teams give our customers great uptime, clear and simple billing, clear and simple contracts and more," Lopez said. "Taylor as CEO oversees customer service by all of these leaders and teams, just as he did when he had the CCO title."
However, Bluewolf's Sklar is convinced cloud companies can benefit by having a CCO, especially since chief customer officers, now more than ever, can glean through customer data to find actionable information that can impact the subscription model.
"Cloud vendors have unprecedented and, for the most part, real-time access to how customers are engaging with their products pre- and post-sale," Sklar said. "Pair that with a license-based subscription model and you have a regularly recurring incentive to ensure customers are getting the most out of their investment."
Furthermore, the position has emerged out of a need to coordinate a better customer-centric strategy.
"The CCO has come about because, in every company, no one department controls or is necessarily thinking about the entire customer experience," Sklar said. "The chief customer officer position is unique because they are the only person thinking about the entire customer experience."
Get more background on the concept of the chief customer officer
Read about the risk of customer churn in the cloud
Dig into the customer experience management trend