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Internal Service Management


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  • 1. Internal Service Quality:Winning from the Inside OutFrom an article by Mary Azzolini and James Shillaber
  • 2. Why is the quality of internal customer service important?The quality and responsiveness ofinternal staff functions is a sourceof differentiation and competitive advantage.
  • 3. The Customer Service MatrixThe four Focus on external customer servicedifferent High Low Focus on internal customer servicecategories of Winners At Riskcompanies I IIbased on thequality of theirinternal and At Risk Losersexternal Low III IVcustomerservice
  • 4. Type I companies (Winners)Companies that focus on both internal and externalcustomer service tend to be winners.These companies are masters at anticipating thechanging needs of their customers, and they have theinternal strength, service orientation, and capability todeliver high-quality products and services on time.Based on their actions in the marketplace, companiessuch as WalMart, Federal Express, and General Electriccan be placed in this quadrant.
  • 5. Type IV companies (Losers)Companies with poor internal and externalcustomer relationships tend to be losers.If these companies don’t change the way theyoperate, they likely will go out of business.Eastern Airlines and Pan Am are examples ofType IV companies.
  • 6. Type II companies (At Risk)Companies with excellent internal but poor external customerrelationships are on the edge and risk falling off the chart.Many companies that operate in a regulated environment can befound in this cell of the matrix; because they have a guaranteedcustomer base, they tend to be completely focused on the internalworkplace and ignore the external marketplace.AT&T once occupied quadrant II and, with deregulation, founditself on the edge. AT&T was strategically vulnerable and risked beingout-manoeuvred by more externally customer-focused competitors.
  • 7. Type III companies (At Risk)Companies with excellent external and poor internal customerservice are on the edge.Consider Nordstrom’s, a retail store that offers externalcustomers a host of services such as valet parking andpersonal shoppers. But Nordstrom’s internal relations areproblematic. A number of employees have filed EqualEmployment Opportunity suits for unfair practices. Theseproblems could be devastating and put Nordstrom’s overthe edge.
  • 8. “Internal customer service is meetingthe expectations and requirements forsuccess of those people inside thecompany so they can delightcustomers in the marketplace.” - T. Kerry McCarter, vice president of quality at Johnson & Johnson Quality Institute
  • 9. Who is involved in internal service management?• Anyone supplying internal customers in the value chain (Primary Activities)• Anyone in any of the organisations Support Activities – Information Services – Marketing – Finance – Human Resources – Customer Services – Facilities Management – Purchasing
  • 10. How can a department improve internal service quality?
  • 11. Step One: Audit• What products or services does the department provide?• To whom are these products and services provided?
  • 12. Step Two: Self AssessmentInternally:• Assess range, availability and priority of services / products provided• Examine departments ‘Five Pillars’ supporting quality service: – Structure – Systems – Technology – Capabilities – Culture
  • 13. Step Three: Customer FeedbackFor a core of key customers ask:• How satisfied are you with products and services you receive?• How important are those products and services to the effectiveness of your operation to create value for external customers?
  • 14. Step Four: Prioritise and AlignUsing customer feedback, involve all membersin the department to examine:• Where is our customers’ needs the greatest and our service gaps the widest?• Prioritise results (Needs and Gaps)• Where are there misalignments between customer needs and department’s ‘Five Pillars’ (Structure, Systems, Technology, Capabilities & Culture)
  • 15. Step Five: Plan and Implement Corrective Action• Appoint action teams to use customer and staff feedback to plan corrective action plan to address root causes of service gapsEnsure that:• Customers’ needs determine the department’s strategy• Department’s ‘Five Pillars’ align with strategy• Implement strategy in a prioritised and orderly process
  • 16. Step Six: Continuous ImprovementRemember:• If it’s not planned, it probably won’t happen – Plan needs timeliness, accountability and review• If it’s not measured, it’s not real – Measurement and comparison provides evidence and commitment• If it’s not true for the customer, then it’s just not true – Don’t waste effort and resources in activities customers don’t need
  • 17. Authors:Mary Azzolini is the director of internal performanceimprovement practice at Wm. Schiemann & Associates, Inc. inSomerville, NJ. She received a master’s degree in industrial andorganizational psychology at the University of New Haven inConnecticut. Azzolini is a member of ASQC.James Shillaber is the director of corporate training andorganization development at Berlex Laboratories in Wayne, NJ.He received a doctorate in clinical psychology from RutgersUniversity in Piscataway, NJ.For original article, go to: