Post 1 of 4 in the Startup Series for CCOs.
Very few startups start out with a Chief Customer Officer, even though customers are the lifeblood of every startup; instead, you’ll likely start your customer service organization with a “jack of all trades” account manager position. You’ll have one person who handles all customer issues, from basic support all the way through to true customer success.
Sometimes these functions will be handled by the product team, but most often they’re driven by a customer service team. Specialized roles and multiple teams (e.g, support vs. professional services) with their own managers may emerge quickly as a startup grows. These roles will usually come before a full-time CCO, unless one of the company’s founders happens to be playing that role.
But you won’t be able to scale effectively (or quickly) with a hodge-podge of customer support roles. There are telltale signs that will let you know you need to bring in a CCO.
For example, you’ll know it’s time to hire a CCO if you realize you’ve never measured customer satisfaction. You don’t have any metrics at all—no Net Promoter Score, no basic customer satisfaction measures, no product engagement levels…nothing. You’re just hoping for the best, and hope is not a strategy.
If you’re spending too much of your own time putting out customer fires, rather than thinking about how to make customers more successful by using your product, this is a second sign that you need to hire a CCO.
Another telltale sign will come from your board, if you have one. If your board asks you which of your customer segments has the highest margin, or has the most opportunity, and you don’t have a great answer and aren’t sure how to get to one, then it’s time to consider hiring your first CCO. Of course, you don’t have to wait for a board member to ask that question. If you want to be proactive, you can create a list of questions a board member might ask and see whether or not you can answer them. If you can’t, or if it takes a ton of time to track down the answers, you’re probably ready for a CCO.
The search for a CCO can be long and time-consuming. In a future post, I’ll talk about what “great” looks like for a CCO, but if you’re at the point where you need a CCO but don’t have the money or time to bring in a full-time executive, a fractional CCO is a great option. A fractional CCO can work well if you have a relatively contained or small customer success/account management organization, but one that’s already very diverse in its sub-functions (support, account management, success, professional services) and none of the team leaders of those teams have the range of experience to orchestrate the handoffs and synergies across the sub-functions.
A CCO touches nearly every part of the organization, from sales, to product, to marketing. This person needs to be a collaborator, a champion for customers, and a strategic thinker who understands consumer trends and demographics. A fractional CCO can bring a lot of skills to a startup and help grow both the customer organization and the individuals in it by mentoring those in the Customer organization who can become eventual leaders, helping to reorganize the Customer organization for greater efficiency, or even helping interview, vet, and find their replacement.
If you’re a startup with potential to scale, but you seem to be spending a lot of time and energy working on customer issues—without being able to actually move forward—a Chief Customer Officer should be a role you look to fill as soon as possible. Almost nothing takes down more companies than poor customer support.
-Matt Blumberg, January 26, 2023.
