Quality Review

Every company is part of a long chain of customers and suppliers. Each company is a customer to its suppliers and a supplier to its customers, so it doesn’t make sense to think of a company as only one or the other. One implication of this concept is that your customer’s customers are, in sense, your customers as well. Sometimes a company must focus on both its immediate customers and those next in the chain.

1. Principles include recognition of the strategic importance of customers and suppliers; development of win-win relationships between customers and suppliers, and establishing relationships based on trust.

Customer satisfaction is giving the customer something they expect and it makes them happy. Customer loyalty is achieving strong profitability and market shares while the customer stays with the company and make positive referrals.

Three practices for dealing with customers is a) collect information constantly on customer expectations; b) disseminate this information widely within the organization; and c) use this information to design, produce, and deliver the organizations products and services.

Strong customer/supplier relationships are based on three guiding principles: recognizing the strategic importance of suppliers in accomplishing business objectives, particularly minimizing the total cost of ownership; developing win-win relationships through partnerships rather than as adversaries; and establishing trust through openness and honesty, thus leading to mutual advantages.

Roles for customers include resource, worker (co-worker), buyer and beneficiary (or user).

Functional structure provides an organization with a clear chain of command and allows people to specialize in the aspect of the work for which they are best suited. They also make it easy to evaluate people based on a narrow but clear set of responsibilities. The functional structure is designed primarily for administrative...