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With Service and Satisfaction For All:  
Improving internal customer service can increase profits, decrease costs, and improve regional vitality

          Kelly L. Glass, Consultant

“Caring for your ‘associates’ is fundamental to caring for your customers and shareholders."
-Home Depot co-founder Arthur M. Blank[1]   

“Employee satisfaction equals customer satisfaction at UPS.” 
-former UPS CEO Kent Nelson[2]  

Businesses that want to remain competitive must realize internal customer service is more than idle rhetoric or dogma.  Treating your employees, co-workers, associates, and managers like your clients will improve service to the external customers who purchase your goods or services, reduce company turnover costs, and may bolster the economic vitality of your community.   

Internal customer service is a framework through which the needs of your employees are met so they can provide your clients with the best possible experience in purchasing the company’s goods or services.  Simply put, if your employees receive top-quality service from their managers and co-workers, they are more likely to offer superior service to your customers. [3]  At a consulting firm, for example, the internal customers are principals, consultants, and support staff.  The external customer is a client.  If co-workers and other staff neglect to provide top-notch and timely services to one another, then the quality of the consultant’s work potentially is compromised, and the client is dissatisfied.  Conversely, if resources are available and all internal players are satisfied, the consultant is able to deliver meaningful results and exceed the client’s expectations.  

Moreover, internal customer service may help your organization reduce turnover costs, an increasingly important topic as the Baby Boom generation enters retirement.  The American Association of Retired Persons (AARP) suggests that nearly one-fifth of the total workforce will be age 55 or older within 6 years.[4]  Your company may have to scramble to replace soon-to-retire employees and confront the loss of years of valued skills and incalculable personal and professional networks.  Coupled with the staggering costs of recruiting and training new workers, turnover may seem an insurmountable obstacle.  Treating your employees better than your competitor may lessen the impact of unparalleled retirement and turnover by retaining key people.  The more experienced staff you retain, the fewer dollars you’ll pour into training – all because of your extra effort to satisfy the needs of your people.  

Attracting and retaining talent via strong internal customer service is a win for you and your region.  While competitive advantage was once determined by the proximity of raw materials or shipping points, today’s successful companies and regions are flush with talent.  In fact, the number of skilled workers in your region is directly related to the vitality of your local economy. [5] [6]  As your organizations reputation for impeccable employee relations enable you to attracts and retain a skilled workforce, the talent pool in your region expands.  As our regional labor pool grows, your company can continue hiring the best and brightest.  This symbiotic relationship is valuable for the company and for sustaining a robust regional marketplace.  

For more information about how internal customer service can help your organization, your bottom line, and even your regional economy, contact our consultant specializing in workforce and economic development initiatives, Kelly L. Glass .  Kelly can be reached at 412.722.1111 or via email at kglass@hillgroupinc.com.


[1] Miller, S. (2002). Internal Customer Service: Getting Your Organization to Work Together. Entrepreneur.com. Retrieved on 11 August 2006 from the World Wide Web: http://www.entrepreneur.com/article/0,4621,299619,00.html

[2] Miller, S. (2002). More Tips for Internal Customer Service. Entrepreneur.com Retrieved on 11 August 2006 from the World Wide Web: http://www.entrepreneur.com/article/0,4621,300834,00.html

[3] Farner, S., Fred Luthans, and Steven M. Sommer (2001). An empirical assessment of internal customer service. Managing Service Quality 11(5), 350-358.

[4]The Business Case for Workers Age 50+: Planning for Tomorrow’s Talent Needs in Today’s Competitive Environment AARP December 2005, 4.

[5] Florida , Richard and Gary Gates (2001). Technology and Tolerance: The Importance of Diversity to High-Technology Growth. The Brookings Institution.  Retrieved on 15 August 2006 from the World Wide Web: http://www.urban.org/UploadedPDF/1000492_tech_and_tolerance.pdf.

[6] Florida , Richard (2002) The Economic Geography of Talent. Annals of the Association of American Geographers 92 743-755.

 
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These materials have been prepared for educational and information purposes only. They are not consulting advice or opinions on any specific matters. Transmission of the information is not intended to create, and receipt does not constitute, a consultant-client relationship between The Hill Group, Inc. and any recipient of this material. Readers should not act upon this information without seeking professional advice.