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The Science of Scaling
Q&A | How Do You Decide Whether CS or Sales Owns Revenue from Customers?
Aug 8, 2024
Tackling the dilemma of revenue ownership, the discussion reveals insights on whether Customer Success or Sales should take charge. It delves into the merits of role specialization, distinguishing between 'hunters' and 'farmers.' Explore effective decision-making frameworks and the importance of a motivating compensation plan. Learn about the Leading Indicator of Retention and the necessity of CFO collaboration in these strategies. Keep those questions coming for more enlightening conversations!
23:18
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Quick takeaways
- The balance between specialization in sales roles enhances efficiency but risks neglecting customer relationships, impacting lifetime value.
- Designing a compensation plan that aligns with long-term customer retention leads to sustainable growth and better incentivizes nurturing relationships.
Deep dives
Deciding Revenue Ownership: Specialization vs. Generalization
Determining whether customer success (CS) or sales should own revenue generation involves considering the context and structure of the sales team. The trend towards specialization arises from the need for distinct roles—hunters to close new sales and farmers to manage renewals and expansions. This specialization can optimize the strengths of individuals for specific tasks, allowing skilled closers to focus on acquiring customers rather than managing ongoing relationships. However, the model presents challenges such as creating potential disconnects during handoffs and incentivizing team members to prioritize their metrics over the overall goal of maximizing customer lifetime value.
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