Customers Who Don't Pay?

We all know who our customers are - don't we? They are that valued set of people or businesses that choose us to do business with. They are the ones that pick our combination of products and service above everyone else's. But we might consider looking inside our business for a whole new set of customers - ones that just might make growing a successful business a whole lot easier and more profitable.

In well run companies, the needs and expectations of current and potential customers play a large role in shaping not only the products and service offerings but how the organization goes about its business in all areas. In more extreme cases -- such as in companies that have underdone radical business process reengineering -- the company has attempted to identify and eliminate all activities that do not provide measurable value to customers.

Those activities that provide real value to customers are quite apparent in areas such as sales, customer service and many operational roles where there is a face-to-face, direct interaction with the customer. In these areas, the customer's needs and expectations become the obvious driver of what and how things are done. Team members in these areas are witnesses to immediate reactions and feedback from customers, and in turn this helps them focus on doing the right things for customers.

Unfortunately, coworkers and work units that are "behind the scenes" may not come in direct contact with paying customers and therefore have a much more difficult time understanding how they fit in to this customer value equation. This issue has become a challenge for progressive companies trying to synchronize and energize the entire workforce to focus on establishing a truly customer-focused business. It also poses problems for companies experiencing sustained growth.

Right here in Southwest Florida there is a tremendous number of companies growing rapidly and finding the need to add on people in operations as well as in non-operational support roles. Many have already realized that with this growth in sales, a number of critical problems become evident. Some of these problems relate to:

** Skyrocketing costs and inefficiencies resulting in weak profits despite excellent sales growth

** Poorly communicated, frustrating and error-prone interaction between different work units

** Declining quality and customer satisfaction

One major cause of these problems is that when the company grows, it grows further away --- rather than closer to -- the customers. As a business grows, people are added to support the growth. Many of these additions are in work areas that may not have direct contact with the customer. If we compare a business to an iceberg, only the visible tip of the iceberg may be people that interact directly with customers -- for example, sales, customer service, and many operations. The rest of the iceberg -- invisible to the customer - represents those employees that service parts of the business, but not the paying customer directly. With an increasing number of these support functions and the additional complexity to the organization's structure, it is common for these work units to lose sight of the customer and in the worst case, become too internally focused.

The problems that often accompany the growth and changing structure of a business that we identified can be dealt with by taking steps to make the business work more effectively together for the customer. Unfortunately, change in the workplace is never easy, and it becomes more difficult the more people that are expected to change. In fact, I would argue that the greatest reason for a lack of success in implementing positive changes is failure of the heads of the organizations to put themselves in the place of the employees and ask themselves, "What's in it for me?"

Co-workers as Customers: A Solution to Growing Pains and Customer Dissatisfaction,

Companies can become more in tune with their customers and resolve many of the aforementioned problems by introducing the idea of internal and external customers. External customers are the traditional, paying customers. Internal customers are co-workers or work units that receive and rely on work from other internal groups. The notion is to get every employee to focus on meeting or exceeding their customers' needs and expectations. No matter where someone is in the company, he or she will have a customer - either the external, paying customers or internal customers represented by co-workers or other work units.

When a co-dependent relationship between co-workers is shown as necessary to satisfy the paying customer, employees realize the importance of working aggressively on meeting each other's needs. They can easily see how if they slip up and do meet deadlines or provide the wrong information to their internal customer, it gets passed on in the form of poor quality, late or missed deadlines to the final customer resulting in customer dissatisfaction. And perhaps just as importantly, each co-worker can see what's in it for him or her by imagining how work will become easier and less frustrating once his or her needs are being met more often.

The "How to"

In a simple sense, to create a pervasive work environment that consistently meets customer requirements, co-workers must first identify all of the processes they are involved in and who the internal customers of each of their work processes are. At that point co-workers work with their internal customers to fully understand their specific needs. Once they know what it takes to satisfy the needs of their customers, their goal is to focus on satisfying those needs each and every time.

With a planned approach and a sustained focus on creating co-workers as internal customers, businesses can realize substantial gains in profitability, customer satisfaction and workplace morale. It's amazing what happens when people are pulled closer to the tip of the iceberg and begin to fully understand just how important their role is to internal and external customers alike.

Rorie Wilson's firm, BPM International, is a Southwest Florida-based consulting firm that assists organizations in achieving performance excellence through Total Quality Management and Customer Satisfaction systems.