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KD McAlly Group

KD McAlly Group a leader in Customer Success, CLG, ARR, NRR, CSM, GTM, go-to-market, revenue growth, voice fo the customer, operations and customer delight

How Changing Your CS Comp Plans Benefits Everyone

You want the Carrot

You want the carrot.  No, I’m not just talking to the Customer Success Managers.  CS Leaders, in order to further enable your CLG initiatives, you want the carrot too!  Performance-based comp plans not only increases the potential of what a CSM can earn, it also has the ability to increase company revenue and customer delight and that’s a great thing for all parties.  However, changing the Customer Success comp plan isn’t always easy.

Changing a sales compensation plan to be more performance-based can be a tricky conundrum for businesses to navigate. On one hand, a more performance-based plan can motivate Customer Success Managers to work harder and increase revenue. On the other hand, it can also create tension and dissatisfaction among revenue and sales teams if the plan is not well-designed or communicated effectively.

The first step in changing a CSM comp plan is to clearly define the goals and objectives of the new plan. Will it be based on ARR, NRR, Churn, or another metric? Will there be different tiers for different levels of performance? How will performance be measured and tracked? It’s also worth noting how these plans align with existing sales comp plans as you will want to consider the value and risk of an employee’s desire to move in between the two job functions.  These are all important questions to answer before implementing a new plan.

Next, it’s important to communicate the changes to the CSM team and address any concerns or questions they may have. CSMs will need to understand how the new plan works, how their performance will be measured, and what they can do to maximize their earnings.

It’s also important to consider the potential impact on team dynamics. A more performance-based plan can create competition among CSMs, which can be positive or negative depending on how it’s managed. Customer Success managers must ensure that the plan is fair, and transparent, and incentivizes collaboration and customer delight rather than cutthroat competition.

Finally, it’s important to monitor the effectiveness of the new plan and make adjustments as needed. Regularly reviewing and analyzing Success data can help identify any issues or areas for improvement.

Overall, changing a Customer Success comp plan to be more performance-based can be a challenging conundrum, but with careful planning and communication, it can ultimately lead to increased motivation, productivity, and revenue for the business.

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