Quality management benchmarking: reliability and validity

Benchmark Firms

Internal and the external customers of a business organization.

Internal customers are employees of a company that utilize services or goods provided within the company. Such services can range anywhere from necessary services that are required to keep the company running smoothly, such as the service provided by the IT department to employees who conduct most of their work on the computer, to services that are provided by the company to keep morale high among the employees, such as the service provided by a company-owned gym.

To exemplify further, let's use Sony Pictures as an example. Sony Pictures is a multi-billion dollar corporation located in Culver City, California whose main purpose is to create and distribute feature films. The employees of almost every department of this multi-faceted film conglomerate, including Business Affairs, Legal Affairs, Human Resources and Security, conduct their day-to-day employment duties via computers. The Legal Affairs needs to use Microsoft Office to draft agreements, while Business Affairs needs the internet to stay in constant contact with producers to close deals, and the Security and Human Resources departments require access to the intranet of the company. When problems arise with such above-mentioned computer use, the employees will call the Information Technology department to fix the problem. The IT department will walk the employee through fixing the problem on the phone, or if the problem is with the computer itself, then the IT department will send a technician directly to the employee's desk to fix the problem or provide new equipment. The employee who calls IT with a problem is an internal customer, and will expect the technicians in the IT department to treat them as if they were paying customers.

To keep the employees in the above-mentioned departments working efficiently, the company must provide certain amenities to keep morale high, such as a gym. The gym staff (orientation guides, trainers, class instructors) treat the employees who use the gym as customers, but since both the gym staff and the employees are ultimately employed by Sony Pictures, the gym users are internal customers.

External customers are the end-users, whose money spent on the company's product or service keeps the company in the black and pays for the employees' salaries. This is the important distinction between the two types of customers. The end-user keeps the company afloat, while the internal customers are a drain on the system. However, both are a necessary element of the corporate machine. Using the Sony Pictures example, there are two levels of external customers. For a theatrical release film that Sony distributes itself to the theaters, the first level of external customers is the theater itself who pays for the right to show the film in its movie theater. The ultimate end-user is the ticket purchasing movie-goer because a portion of that ticket cost goes back to Sony and determines whether or not the film made enough money to be considered a box office hit, or a flop. For a straight to video movie that Sony Pictures purchases completed from a producer, it will distribute such film internationally through distribution companies that will pay Sony the right to distribute the film in certain forms in certain territories. Those distribution companies are the first level of external customers, then again, there is the end-user who purchases or rents the DVD or downloads the electronic version of the film for a fee. A portion of that fee paid by the viewer goes back to Sony. Both