Who is the Customer?

How do you know a customer when you see one? We all hear: listen to your customers; customer service is everyone’s job; and without customers there is no business. These sayings are often repeated, and often believed - but who is this customer?

Customer is defined by most dictionaries as someone who purchases a product or service. Therefore the easiest way to identify a customer is if they give you money in return for a product/service. But what if a parent gives a merchant money for a product that a child uses? Aren’t they are both customers in this case? The parent is a direct customer of the merchant and the child is an indirect customer.

So the dictionaries are not fully accurate in their definitions. To better address the parent/child example, the customer definition should be expanded to: A customer is someone who accepts a product or service provided by the efforts of others, under mutually beneficial conditions.

In the example above, the merchant, parent, and child all established mutually beneficial conditions; with the parent accepting the product from the merchant, and the child accepting it from the parent. Under the expanded definition, the parent and child are customers of the merchant, and the child is a customer of the parent.

Consider a supply chain that consists of multiple companies. Using the new definition, each link in the chain is a customer to all the prior suppliers. Suppliers that understand the needs of their customers, their customers’ customers, and their customer’s customers’ customers, etc., will be able to provide increased benefits and greater value to each level of customer.

Now consider a single company. Supply chains exist within companies as well - since each individual in a company that accepts a product or service from another, under mutually beneficial conditions, is a customer.

This definition treats a lot of people as customers. Excellent customer service generates the same benefits from them as from any customer. Companies managing their internal supply chains as their external ones: reduce costs, increase throughput, lower cycle times, and improve overall quality.