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If your company can be counted among the many that have adopted the language of “internal and external customers” as a way to improve service quality delivery, you may be doing harm to your organization. Far too many organizations promote a popular misconception: that co-workers, other business units, company task forces, branch offices, and company-owned sales and distribution channels are “internal customers.” It is indeed important to treat employees well if you want them to treat customers well, and it is generally agreed that when employees are treated with respect, they put forth more effort and get more job satisfaction. However, employees who are told that they and their fellow employees are the company’s customers—and are rewarded for satisfying co-workers’ expectations as their first priority—will assess their own efficacy by how efficient they are at serving other employees. Service to the bureaucracy becomes the benchmark of excellence. The idea of the internal customer is popular because it is easy to embrace. By comparison, the needs and wants of “external customers” and the paths to creating value for them are abstract, elusive, and difficult to quantify and satisfy. A better approach to guide employees is to adopt the adage “If you are not serving a customer directly, you’d better be serving someone who is.” Never lose sight that unless customers are more satisfied with your offering than with the alternative, they won’t be your customers for long, no matter how satisfied your employees are with the service they provide and receive from each other. Customers, not employees, decide the fate of businesses.

New research by the author indicates that Canadian executives perform well on strategic intent, but have difficulty converting intent into results. Through a better understanding of the gaps that exist in the foundational pillars important to achieving a high-performance culture, executives and managers can focus on closing these gaps to support strategic execution, improve employee morale and engagement, and drive marketplace success. This article includes the findings of a survey based on the Corporate Organizational Vitality Index, which provides insights into how Canadian executives perceive their corporate culture.

Many managers indicate that their organizations are very good at starting projects, but not so good at finishing them. According to this author, the reason most often cited is that marching orders change when other priorities are recognized. Employees find this extremely frustrating and wasteful, as it is difficult to make positive gains when managing on a sea of shifting priorities. The author suggests that there is a better way.