Profit Minded

Internal Customers: Do You Know Who They Are?

Internal Partnership

The term customer is most commonly associated with someone who purchases goods or services, but Joseph Juran, the famous management consultant, taught that organizations have both internal and external customers, and internal customers have a direct link to a positive external customer experience.

The external customer is the person who purchases the goods or services, while the internal customer is anyone within an organization who at any time is dependent on anyone else within the organization.

We all know the importance of taking care of the external customer (the people who purchase our products and services), but successful organizations recognize the importance of taking care of the internal customers – employees and any other stakeholders. For example, if a secretary is dealing with computer issues, the IT department considers that person an internal customer and makes as much of an effort to meet her needs as the call center person does to take care of the external customers who call in for assistance.

Why Focus on Internal Customers

Impact on External Customers

Internal customers have a direct link to the external customers and the quality of product or service they receive. Whether the internal customer is the receptionist (the supply chain starts with her so it’s best not to overlook her), the warehouse manager or the call center representative, every person in the supply chain is important to delivering a great product or service.

Cultural Working Experience

Taking care of internal customers impacts an organization’s culture and working environment. Employees need to feel valued and appreciated for what they bring to the table. How other employees meet these needs influences this experience. For example, if the receptionist isn’t given the information needed to answer caller questions, she not only fails at her responsibilities but also feels like an afterthought in the information communication chain.

Speed Up Systems and Processes

Bottlenecks occur when employees are waiting for other employees to provide the necessary product, service or information necessary to perform their job duties. For instance, if a purchasing agent is waiting for a department order, that delay can affect the ordering process, which can result in the order not arriving in time for a customer.

How to Improve the Internal Customer Experience

Create Service Standards

Create standards of service for not only external but also internal customers. Thinking through the process and setting standards for response times for things like emails, phone calls or internal requests help to set expectations for employees. Employees should be held accountable for responding to a co-worker’s request within a predetermined period of time.

Employee Training

Teaching personnel should train employees on the importance of meeting the needs of all customer groups. This includes a heightened awareness of how taking care of other employees’ needs has a direct impact on the external customer experience. This is the opportunity to set service standards and address any issues related to meeting those standards.

Manage Performance

Standards and training are important, but unless employees are held accountable for expected behavior, these are merely exercises in futility. This is why it’s important to have a performance review process that incorporates employee expectations with goals that are tied to pay and reward systems.

Job Swap

It can be a beneficial exercise to have employees from related, dependent departments meet and explain what they do and how they do it. For instance, when I worked in healthcare, employees who worked in the patient registration department worked in the patient billing department (and vice versa) as part of their training. The billing department was on the receiving end of the patient registration information. So, if there was an error in the registration process, it had a direct impact on the billers. That’s why it was important for the patient registration employees to understand how what they did affected those down the information supply chain.

Process Improvement Teams

Use employees to help resolve internal process issues or departmental problems by creating a team that represents the entire process. In the healthcare situation a team to reduce the billing cycle time would include members from the patient registration department as well as members from the billing department. Having all perspectives involved in the problem-solving adds clarity to problem resolution.

Customers pay the bills and our salaries so taking care of their needs is critical to business success. That includes internal customers who have a direct impact on the external customer experience. So, employees should place as much effort on satisfying their internal customers as the external customers.

Patricia Lotich is the founder of The Thriving Small Business and a small business coach. Patricia helps business owners solve problems and develop strategy and goals to achieve objectives. Schedule a free 30 minute phone consultation with Patricia to see how Thriving Small Business can help your organization.

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