21 October 2007

The Internal Customer

I am sure you have encountered the concept of the “internal customer” in your organizations (especially if you are in delivery organizations). This happens when one group or team in an organization believes that they essentially serve to another group/team internally which in its turn, exist to serve to another team and so on till the last team actually serves up the real customer.

This happens when Development thinks Product Management is their customer or when Product Management thinks Sales is the customer and so on. A few weeks back I overheard a variation of the same concept in a meeting “we will completely outsource this to you – let’s agree on the budget and SLAs”.

The theory is if each team performs to its best level in delivering to the next team and the chain continues in that fashion, the real customer will get the best performance.

In reality, this is a very simplistic view at best and delinquency to the real customer at worst. The fallacy of the thought process are many. To name a couple,

• This gives rise to “buffer bloat”. Each team, in its desire to meet the agreed upon SLAs and metrics, will build in its own “safety” buffer. (also known as sandbagging). By the time these buffers are compounded across the chain, it can be scary.
• This also loses the straight line of sight to success. Which means you will find situations where the customer and organizations closer to the customer are not meeting success critieria but other organizations (usually further away from the customer) meeting their numbers and declaring success.
The best culture to grow is recognition that there is only one customer. And that is the person who pays up the money.
Nobody else is the customer. Everbody else is part of a team that delivers to that one customer. To compare with a football (soccer) team, no one player passes the ball to the player ahead of team and declare his/her job is done. Everybody has a position to play – even when they do not have the ball. But they have only one common goal to meet – no interim internal goals.
To mix the metaphor a little, to compare with the American football team, everybody plays on the same game plan. No doubt there is going to be one quarterback (I like to think of that as the sales organization). But there are running backs, tight ends, punters, wide receivers each playing their own position in tandem with each other to meet exactly one goal. But nobody in the team is trying to “satisfy” some other player in the team. Nobody is measured on any other term than the one score that everybody else is measured on.
In summary, dissuade people from thinking they serve some internal teams.
Establish a clear line of sight for each team to the one real customer – one goal.
Align metrics such that no one of the teams can be successful if they whole chain is not successful.
Would like to hear about your experiences…

Posted October 21, 2007 by Rajib Roy in category "Reflections

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