Organizations exist to serve their customers. A customer can be defined as any individual or group that acquires goods or services from an organization in exchange for payment or some other form of consideration. Customers can be divided into two broad categories: internal customers and external customers. Internal customers are those within the organization, such as employees or departments, while external customers are those outside of the organization, such as vendors or clients. An organization must serve both of these customer groups in order to be successful. In this blog post, we will explore the differences between internal and external customers and discuss strategies for meeting the needs of each. We will also look at how organizations can use customer service to build customer relationships and develop customer loyalty. Finally, we will examine how organizations can ensure the satisfaction of their customers, both internally and externally. By understanding the differences between internal and external customers and the strategies to meet their needs, organizations can maximize their customer service and ensure customer satisfaction.
What are external customers?
The individuals who pay for the goods and services that a business offers are known as external customers, also referred to as the clients or clientele. Typically, they are only connected to the business through their purchases. Because external customers account for a large portion of a company’s revenue, cultivating relationships with them is crucial for business success. Because of this, the majority of product, marketing, and user experience (UX) teams place a high priority on ensuring the satisfaction of external customers.
Some specific types of external customers include:
What are internal customers?
Employees of the company who use the goods or services that another employee provides are known as internal customers. This frequently entails asking someone else at the company for assistance. For instance, if an employee contacts the IT department for help with a computer problem, the employee is now the IT department’s internal client. Internal customers can also include owners, shareholders, and other types of representatives.
Some common types of internal customer relationships include:
Employees within a team
When an employee on a team asks another employee for assistance because they need it, they become an internal client of the other. For the majority of teams, this type of interaction happens almost daily. Some roles constantly depend on other people to carry out their own work. For instance, a social media manager may count on a team member who is a graphic designer to complete a graphic for a social media post.
Employee to IT department
When an employee encounters a technological problem, they can ask the IT department for support. This is an essential internal customer relationship because the majority of businesses depend on computers and other technology to run efficiently. An IT team member may occasionally be required to assist an employee before they can continue with their work for the day. This means that for employees to perform to their full potential throughout the workday, the IT department’s quick and efficient customer service is crucial.
Employee to HR department
Human resources departments offer benefits and training, so every employee is a company internal customer. HR may also assist with internal relational conflict and mediation. The HR department and specific branches or managers may be one another’s internal clients when hiring new employees because they collaborate on the hiring process.
Internal employee to product
The company’s merchandise may be consumed by internal staff members as well. In this case, the employee uses the product as a customer within the company. When making this purchase, they may decide to use the same channels as other customers or they may rely on internal information to locate exclusive discounts or service options. For instance, if a hotel chain employee stays at another hotel in the chain, they may receive a discount.
Internal vs. external customers
Internal customers operate from within the company structure, whereas external customers are not a part of the company. This is the main distinction between internal and external customers. Numerous other differences between the two types of customers are based on this significant difference. Here are some of those differences:
Connection to the company
One key distinction between internal and external customers is how connected they are to the business. External clients are not compensated by the business, and they are not held accountable for anything besides each transaction. While some customers may stick around and even form relationships with the business, many people only deal with it occasionally.
Internal customers have a variety of relationships with the businesses they work for. The business compensates an internal client for their work and might also offer employment benefits. This indicates that internal clients frequently depend on the business for their personal and financial security. Similarly, the business depends on its employees to perform well after spending the money to hire and train them. Because of this relationship, internal customers are frequently more devoted to the business, whereas external customers might be more inclined to buy products from whichever company best serves their interests.
Knowledge regarding the company and product
Internal customers typically have a thorough understanding of the structure and operations of the company they work for. They might find it simpler to use the appropriate channels for their needs as a result of this. Additional customer service channels may be needed to connect external clients with the appropriate department to meet their needs.
Internal clients might also be privy to insider details about products or offers that they can take advantage of. For instance, an internal customer may be aware of the exact cost of production of a product and may use this knowledge to negotiate with the business for a lower price. Due to their reliance on the information provided by the company in its advertisements, external customers are more likely to accept product prices at face value.
Customer service goals
Customer service is likely to concentrate on assisting external customers in making purchases because they generate revenue for a business. Another objective might be to make the purchasing process simple for outside customers to entice them to leave favorable reviews. Internal customer service objectives might center on developing the best working environments or procedures to encourage job satisfaction and productivity.
Frequently asked questions about internal vs. external customers
In order to better understand internal versus external customers, consider the following frequently asked questions:
Why is it important to care about internal versus external customers?
Customers always come first in business, so treating internal staff as a different kind of customer can help large organizations respect the needs of their employees. Companies that encourage employees to view other employees the same way they view customers may increase the likelihood that departments will work together quickly.
It’s also critical to remember that internal customers will likely perform better in their roles within the organization if their needs are met. Understanding and meeting needs, such as those for improved channels of communication or product support, may enable an internal customer to complete their work as quickly and effectively as possible. More general needs and wants can be accommodated to create a better working environment, which may boost productivity, employee satisfaction, and long-term business success.
What can you do to help accommodate internal customer needs?
It’s helpful to start by gathering feedback from current employees about their needs in order to create a successful internal customer experience (CX) program. Companies that continuously demonstrate their appreciation for feedback may have the best luck creating open lines of communication. You can implement changes, such as new communication channels, service standards for internal assistance, and celebrations of employee success, once you have a better understanding of needs. Internal customer experience may be improved by having empathetic management, fair pay, a good work-life balance, comfortable working conditions, and functional technology.
What can you do to help accommodate external customer needs?
A company should do everything possible to meet the needs of its external customers because they are the main source of revenue. The needs of external customers can be met by courteous and helpful customer service representatives, consistent communication, and tolerance for any product-related or technical difficulties. These clients can also submit reviews, which may offer helpful information about potential changes. Some companies implement a reward program if an external client has a problem in order to make up for any annoyances they may have experienced.
How are internal and external customers connected?
Some internal positions are “client-facing,” which means they deal with clients on the outside. In these circumstances, it’s likely that the needs of an internal customer will directly affect those of an external customer. In some cases, they may even share the same need. Consider a veterinary clinic with a malfunctioning phone system. For both internal clients like receptionists and external clients who want to call and make an appointment, this would be a problem.
Even though there is no direct interaction between external and internal customers, there is still a connection between them. Internal customers who are happy with the results of their work may produce projects and products more quickly and thoroughly, which may make external customers happier. The company can frequently ensure that they meet the needs of the other type of customer by attending to the needs of the first.
Internal and External Customer Service: what’s the difference?
FAQ
What is an example of an internal customer?
They are typically staff members who carry out a specific task that has an immediate impact on how well another employee performs their duties. A person who manages a company’s email address, for example, is an internal client of someone who creates content for all outgoing messages.
Is customer is external or internal?
To be clear, an external customer is someone who does not have a direct relationship with your business other than through the purchase of your good or service.
What is the difference between internal and external customers in healthcare?
Customers outside of your company are those who primarily view you as a supplier of goods they purchase. Internal customers take an active role in your company by contributing to it.
