The Revenue Benefit of Serving Internal Customers

In the 1900s, three successful retailers — Marshall Field, John Wanamaker, and Harry Gordon Selfridge — coined the phrase, “The customer is always right.” Early in their careers they learned that the success of their stores depended on the happiness of their customers. But is this idea viewed true by today’s business leaders?

Last year Harvard Business Review studied whether companies help to achieve high customer satisfaction by investing in employees — their internal customers. They looked at 293 large employers across 13 industries, including their Glassdoor rating and the American Customer Satisfaction Index, which records the opinions of 300,000 U.S. customers on products and services. The answer was yes: according to Glassdoor there is a strong statistical link between employee well-being and customer satisfaction.

How can focusing on internal customers increase revenue? It’s simple, in one respect; when employees are happy, customers enjoy engaging with them and are more inclined to purchase your products and services. Business leaders that become so customer-oriented they allow workplace morale to suffer are following a poor and short-sighted strategy. Instead, customer and employee satisfaction should be seen as two sides of the same coin.

Now that you know what needs to get done, let’s look at where to start.

Getting the Order. Often companies are focused on getting the order, which should lead to getting the cash. However, there is a “processing/productivity machine” inside your company that works to make this happen. That processing machine is powered by your employees. Studies as well as our years of experience show that if you take care of your internal customers, they in turn will be more effective and feel empowered to take care of your external customers. 

Needs and Feeds. The key to maximizing the value of your internal customers is ensuring you understand your employees’ needs and feeds. The definition of needs is what employees need or need to receive from other people and/or other departments in the company. Often when we ask clients for their Needs, we are given a list of reports or services one department needs from another. Then we ask for Feeds — a list of documents or reports employees are typically asked or required to provide to other people and/or departments.

The people within your company who you “give to” and “need from” are your internal customers. They are extremely important because internal customers pave the road from getting the order to getting the cash. The easiest way to show the internal customers in your company how important they are is by helping them refine the paths of needs and feeds.

Here’s an overview of how we help clients who need to streamline their needs and feeds paths:

• We improve the quality of “handoffs” in their needs and feeds process
• We improve clarity of expectations in their needs and feeds process
• We elicit collaboration, cooperation and cohesion by modeling the art of asking questions
• We build a problem-solving culture for internal customers as a foundation for attracting, servicing and retaining external customers

Everyone in an organization plays a role in serving internal customers. It is only when leaders, both at the top and within individual departments and teams, establish the company-wide expectation that collaboration is a part of each employee’s job – and they clearly define what that looks like — that the company can deliver truly outstanding customer service.

To learn more about how VENN Strategy Group helps build cultures that drive revenue, please contact us.