Marketing as a management style - improving internal customer service

Business Horizons, July-August, 1995 by Clinton O. Longenecker, William K. Meade, II

"It seems like we have made great strides during the past few years in building a system aimed at better satisfying our external customers .... The problem is that we still don't do a real good job of satisfying our internal customers .... It's a real problem for us that requires a serious change of management philosophy and practice."

A CEO's lament

The organizational "near death experiences" that during the last decade bluntly motivated a focus on quality and customer service may nave predisposed managers to a style of "management by crisis." The current decade finds managers needing still more managerial tools of last resort---hankering for a toolbox of crowbars to force radical organizational change. In particular, outsourcing, reengineering, replacement of management teams, and downsizing are receiving increasing attention for their capacity to pry change from within balkanized organizations. Interestingly, these techniques are being implemented in many of the same firms that so successfully transformed their external customer service during the quality revolution.

If the challenge of the quality revolution was to improve customer service in the marketplace, the challenge of today is to improve customer service within the workplace. Why? Because a double standard is emerging. Companies are filled with unresolved conflict, turf wars, rumors, folklore, and frustration over the fact that many departments are insensitive (some would say blind) to the needs of internal customers. Most executives have heard comments such as "It takes forever to get those reports back from engineering" or "Why don't the personnel people ever return my calls?" or "I wish the people in production would listen to our input on packaging!" While customers outside a firm frequently enjoy continuously improving service levels, those inside sense that customer service is poor and nobody really seems to care until a crisis occurs. Not only do internal systems fail to anticipate customer needs, they frequently allow internal suppliers to ignore, antagonize, and even tyrannize internal customers.

The tools available to deal with ineffectiveness and neglect within organizations fall into categories of "exit" and "voice." A market is an exit tool. Consumer choice, for example, is due to the opportunity in a market to "exit" a relationship with one supplier and patronize another. In the context of an organization, the use of vouchers, downsizing, and outsourcing would constitute exit tools. Voice tools are scattered throughout the social sciences, including marketing and management. They might encompass marketing research, TQM, worker empowerment efforts, and self-managed work teams. Hybrid tools of voice and exit are also possible. Boycotts, for example, intertwine the voice of complaint with the threat of exit and the promise of reentry. We would also classify reengineering as a hybrid because although its authority is enacted on the basis of management's power of exit, the element of user voice is an indispensable element of success.

The purpose of this article is twofold: (1) to document manager perceptions of the double standard between internal and external customer service, and (2) to suggest that through skillful application of the "voice" tool, it is possible for companies to improve customer service without the use of crowbars. Specifically, if managers are willing to embrace marketing as a component of their management style, they can create a resource virtually out of thin air. That resource is customer satisfaction feedback, which, when mobilized by measurement and catalyzed by leadership, can overcome organizational balkanization. In other words, we see customer feedback as a valuable tool regardless of a customer's location inside or outside a firm.

This position raises a difficult question: How are marketing and management different? For the narrow purposes of our discussion, management consists of the functions of leadership and coordination, whereas marketing is composed of coordination and an "outside-in" orientation. Coordination provides a common point of contact between the two disciplines where distinctions begin to blur. A convenient dividing line has traditionally been provided by walls. Management involved coordinating people and technology within the walls of the firm to obtain alignment. Marketing involved coordination of companies, product lines, and people "outside" the firm (within channels of distribution) to maximize profits.

Today, however, competitive pressures are forcing firms to think outside the lines of tradition, augmenting both the manager's and the marketer's obligations by adding competitive advantage to the tasks of coordination. For example, management thinkers today, like Peter Senge (1990), are developing such tools as "shared vision," "mental models," and "team learning," which create competitive advantage by producing teams of aligned individuals that, in turn, align with other teams to support core competencies. Marketing thinkers, likewise, have busied themselves bolstering Kotler's traditional bureaucratic mass-marketing focus on customers with a "Just Do It" school of thinking organized around such themes as Apple's Macintosh "evangelism" marketing and Levinson's "guerrilla marketing"--which Guy Kawasaki, in his book How to Drive Your Competition Crazy, characterizes as "disrupting enemies for fun and profit."