Peter Drucker

This post is a bit ‘tongue in cheek’ (so if you don’t agree 100% then please don’t take it too much to heart 🙂 ) but it expresses what I’ve thought for years now.

A business fashion started back in, oooh, probably the 1980s – talking about ‘internal customers’ within organisations. The idea being that you are the customer for the person upstream from you – they are producing for you – and, in turn, the person downstream from you is your customer…and on and on…in a long chain from the start to the finish of a value stream. Lots of lovely internal customers.

But here’s the thing: They aren’t your customer – they are a part of (i.e. colleagues within) your system!

Yes, yes, I know that you are reliant on them and then the next lot are in turn reliant on you…but that’s just because of the design of the (current) method.

And, yes, yes, I know that it would be jolly nice if you all worked together in really efficient and effective ways – but that doesn’t make for a customer relationship. Further, it can be harmful to think in this way.

What is a customer?

I’ll draw on a set of related quotes to assist me here:

“The purpose of a business is to create a customer.”¹ (Peter Drucker)

“It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages.” (Henry Ford)

“There is only one boss. The customer. And he can fire everybody in the company from the chairman down simply by spending his money somewhere else.” (Sam Walton)

The point being that a customer is, by definition, external to the system. Everyone and everything within the system is (or should be) there for them.

Without the (true) customer, there is nothing.

Why does this ‘internal customer’ label bother me so?

Such ‘internal customer’ logic causes us to think that we must do what they ask, and not question them too much, along the lines of the ‘customer is always right’ and ‘give the customer what they want’ mantras.

It presents a suboptimal ‘them’ and ‘us’ situation rather than a collaborative horizontal (across the system) ‘we’.

Once you think in terms of internal customers, it’s only a short and painful step towards the dreaded ‘Service Level Agreement’ (SLA) game show. Grrrr.

A massive risk within the ‘internal customer’ logic is the creation of a static system, one in which the method (and targets) becomes defined in quick drying cement.

If I think of you as my customer, then there’s unlikely to be much challenge from me as to whether your role should change, or even exist…and you sure as hell aren’t going to appreciate any such line of reasoning from me – who the hell am I to suggest this – you are my customer, I am merely your supplier!

Further, as my customer, you may consider that you know best, that your wish should be my command and that I should be grateful to be of service to you. Indeed, you may even score me on how well I treat you. Ouch!

How many of you reading this post have been asked to do something by your ‘internal customer’ and thought that what they were asking for was nuts…and how many of you didn’t get the chance to meaningfully discuss this with them, and had to carry it out anyway?

Even worse, how many of you have switched off from even thinking about whether your internal customer’s request makes sense and have merely become ‘order takers’.

What a load of nonsense. Let’s just throw the ‘internal customer‘ language in the bin.

“But what about treating all our colleagues with respect?!”

I can almost hear some HR departments chiding my thinking as being disrespectful to my fellow employees. No, it’s not!

In fact, it’s the opposite. I think it’s disingenuous for me to pretend that my work colleagues are my customer. They are far far more than that – we are reliant on each other, to keep our jobs, to grow ourselves, to stimulate each other, to want to come to work…to spend our working lives delivering something meaningful to this world. This is soooo much more than being merely thought of as ‘internal customers’.

As colleagues, we need a robust relationship, not one of diffidence and servitude. We need to respectfully challenge each other, work hard to listen to and understand each other’s worldviews…and become better, closer and wiser for this.

We are not ‘internal customers’, we are colleagues.

Addendum:

I always pick a trusted colleague (from an ever widening group of ‘pioneers’) to have a read of my posts before I press publish. I was particularly nervous about this one as I felt that it could just be me ranting about an ‘issue I have with the world’ (again 🙂 ).

…but I got a great response back, with the following gem (thanks A):

“Are the All Blacks ‘customers’ to one another, or are they a team with a shared purpose? By using the term ‘customer’ where it doesn’t belong… it distracts us from understanding who our real customers are.”

This made me giggle. Turning to the wonderful game of rugby, I had visions of the ‘backs’ telling the ‘forwards’ that they are their customers…I don’t think that this would go down too well.

How about the following, even dafter rugby situations:

the jumper in the line-out considering themselves as the customer of the hooker throwing the ball in;
the winger considering themselves as the customer of the no. 10, who is kicking the ball through for them to get on the end of; or, at its simplest
the potential receiver considering themselves as the customer of the possible passer of the ball.

What a load of guff! They’re a team that have to work together, as equals; that have to understand, and swiftly react, to what’s around them; that have to make the selfless pass or tackle; and that have to pick each other up and genuinely offer words of support when perhaps it doesn’t go quite as desired.

They are not ‘internal customers’, they are team mates.

And so, to complete the title of this post: There’s no such thing as ‘internal customers’

Footnote:

1. I’m not a massive fan of this particular Peter Drucker quote, but it fits for this post.

Why so? Unfortunately, businesses have become far too adept at creating customers and, as a result, we have rampant consumerism.

I reflect on Professor Tim Jackson (author of ‘Prosperity without Growth’) clearly calling out THE problem for humanity, and what we* might do about it (* requiring brilliant political leadership).

His take-away quote “The story about us – people being persuaded to spend money we don’t have on things we don’t need to create impressions that won’t last on people we don’t care about.” Prof. Tim Jackson TED talk.

…so I contact a (world renowned) bank about opening an account, but it’s not a basic request:

The comedy begins:

I look up the bank’s internet site to find a number to ring for my specific need. I can’t find anything that fits. The best I find is a ‘contact us’ email form, so I fill it in, explaining my need and asking for the right contact number.

I get an email back providing me with a contact number and instructions as to which IVR selections to make when I ring it (‘press 2 for blah, then 1 for blah, then 3 for blah’).

I ring the number. The IVR is nothing like the instructions. I listen to the (long list of) options. None fit my need so I wait for someone to pick up.

I explain my need to the agent that picks up and am told that “oh no, we don’t deal with that. You need to speak with ‘abc’ department. Would you like me to pass you through to them?” I say that, yes, I surely would.

I am ‘cold passed’ to this 2^nd queue and therefore have to wait in line and then re-explain my need to the agent. They say “No, they shouldn’t have passed you through to us. You need ‘xyz’ department. I’ll put you through.”

Once again, I am ‘cold passed’ through to a 3^rd queue, wait in line and re-explain. They say “We don’t deal with that. You need to speak with ‘blah’ department”

I listen to the original bloody IVR again! I’m really annoyed now. I think about hanging up, but I really want to talk to someone about my need. I decide to wait.

I get another agent and explain about what has just happened to me…this took time and I was clearly exhibiting signs of annoyance (funny that!). I asked them to PLEASE listen to my actual need and spend time with me to figure out if they can assist and then who can. They say that they need to transfer me to someone who can help. I pleadingly ask them to ‘warm transfer’ me over to that person so that I don’t start the merry-go-round again!

I was cold transferred to another number!!! After waiting for an agent, guess what, they couldn’t help and would need to transfer me to…..I hung up.

I went back on to the website, found the ‘contact us’ email address and wrote what I shall describe as a ‘strong email’….I am yet to receive a response.

Now, whilst the above is (verging on) humorous for those not involved, sadly I bet most of you reading it have examples of similar ‘service’ experiences to have happened to you.

To summarise the above:

there was 1 ‘white marble’ of value demand, the actual need for which the bank is there for;
there were 6 ‘blue marbles’ of failure demand (so far!), each of which the bank had to handle*, as if it were a valid unit of production;
- * for each unit of demand they had to: plan and roster staff; handle the queue; handle the call (welcome, understand need, action, closure); record in their systems; performance review the agent as to how the call was ‘handled’….etc
each silo within the bank experienced their vertical unit of activity and probably met each target they set themselves: call answering time, average handling time, call resolution rate….and probably celebrated their success, perhaps with some awards, even some contingent rewards! ;
the bank is oblivious to the horizontal flow that I experienced;

and, worst of all, my need remained unresolved!
- simply and clearly explaining to me that they can’t do what I was asking (if this were the case) would have resolved my value demand.

To use a current buzz phrase, there is nothing ‘customer-centric’ about this experience.

Why does the bank have this problem?

Because it bought into the economies of scale mantra of ‘standardise, specialise, centralise.’

Because it believed that what has been seen/ heard about in manufacturing can simply be applied to service.

Because it bought into technology as an automator of service provision.

What does this cause?

Silo’d thinking, in which effort is put into the efficiency of each vertical activity…at the expense of the effectiveness of the horizontal flow of value, from customer demand through to its satisfaction.

Massive waste that is unseen (though paid for) by the business yet is acutely felt by the customer.

“Cost is in flow, not activity….economies come from flow, not scale.” (John Seddon)

“There is nothing so useless as doing efficiently that which should not be done at all.” (Peter Drucker)

Now you might laugh at this, and think “wow, daft bank!” but, before we dismiss this as not something that could happen to us, I could equally have written about a similar experience I had from ringing an internal helpline at the company I work for. I didn’t (and won’t) write about this internal example because the point is to think about the problem and its causes, not to get caught by the error of blame.

The reason for the madness is the system (and management’s beliefs and behaviours), not the people within it.

None of the ‘customer service agents’ will have enjoyed handling my units of demand – there was no satisfaction to be had in helping me with my need. Each will have been left hollow by their inability to assist…and then they will have moved on to their next call….safe in the knowledge that they cannot change their reality whilst they work within their ‘command and control’ paradigm.