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  Performance Improvement    by H. James Harrington

Who Is Your Customer?

It's important to understand that everyone's primary responsibility is to satisfy the primary customer.

I work for Ernst & Young. I also am the guest speaker at Mellon Bank's Annual Quality Awards Conference. Who is my customer? That should be obvious. My customer is Lisa Sagun, a vice president at Mellon Bank, who invited me to give the lecture.

But is she really my primary customer? Terry Ozan, head of Ernst & Young's Management Consulting Practice, hired me and a few thousand others because he had so much work to do that he couldn't accomplish it by himself. When I was hired, I agreed to perform a specific set of tasks for him for a defined salary. In other words, Terry bought my services, so he is my primary customer. In turn, Ernst & Young sells my services to Mellon Bank. So Mellon Bank is one of Ernst & Young's primary customers, but it is a secondary customer to Terry and me (see Figure 1).

It is very important to understand that everyone's primary responsibility is to satisfy the primary customer. When dealing with secondary customers, you must meet and exceed their expectations as long as you can also meet and exceed your primary customer's needs and expectations. When a conflict exists between your primary and secondary customers' needs, then your primary customer should always receive priority.

For example, I had a secondary customer that wanted a TQM system installed in their manufacturing processes. They asked Ernst & Young to do the entire installation because they didn't want to use any of their management's valuable time. Ernst & Young's TQM model starts with gaining the executive team's commitment to attend classes and be the first to change their behavior patterns. There obviously was a conflict between the needs of the primary and secondary customers under these circumstances, so we walked away from the contract.

Another example is the client that wants to pay X dollars a day to have me work with them. Ernst & Young wants 2X dollars per day for my time. Obviously, the primary customer wins.

This primary-secondary customer relationship exists at all levels. The external customer is not No. 1. If Ford's only concern was the external customer, then it would have sold my new Mustang convertible to me for $5,000, not $31,000. I assure you that I would have been a much happier customer. I would have bought one for my wife and son also, so Ford would have tripled its sales.

What happens if you feel it's more important to meet the needs of your secondary customer than your primary customer? Then two options are morally correct: You can convince your primary customer to change his or her needs and expectations, or you can resign from the organization and look for another job.

When the rubber meets the road, your primary customer must be satisfied. It's nice if you also can satisfy your secondary customers. As quality professionals, we have focused on meeting the needs of the individual or group that receives our output. Usually, these individuals or groups are our secondary customers. But it is even more important to meet the needs of the individuals and groups that have authorized us to do the job -- our primary customers. Usually, these requirements are much more stringent than those set by our secondary customers because they include most of those requirements, as well as a set of efficiency requirements.

When considering secondary customers, divide them into two groups: internal and external. This division is necessary because, if you go up high enough in the organization, the external customers become primary customers and, as a result, deserve special consideration over the internal secondary customers.

I hope this column made you realize that your management team is your most important customer. You probably don't like thinking of your external customers as secondary customers. I selected the terms primary and secondary because I thought it would help people establish their true priorities. I certainly don't recommend that when you speak with your external customers that you call them secondary customers. Select a word that's acceptable in your industry. I like to call my external customers clients.

By now you probably can see the difference between secondary and primary customers, and agree with the concept. A future column will explain how to measure primary and secondary customer satisfaction.

About the author

H. James Harrington is a principal at Ernst & Young and serves as its international quality advisor. He can be reached at 55 Almaden Blvd., San Jose, CA 95113; telephone (408) 947-6587, fax (408) 947-4971, e-mail jharrington@qualitydigest.com .


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