Introduction
In today’s rapidly evolving work environments, organizations are increasingly recognizing the importance of internal customer service. The Institute of Organizational Psychology (IOP) introduces an important perspective: internal customer service, or how employees treat one another within the company. The way individuals interact internally significantly impacts company culture, employee morale, and overall organizational success.
This case study explores how internal customer service influences organizational culture, employee performance, and company outcomes. It also outlines the steps organizations can take to build a healthier, more supportive workplace.
The Challenge: Fear-Based Cultures
Many organizations, despite having sophisticated external-facing customer service strategies, fail to cultivate positive internal customer service. Unfortunately, a culture rooted in fear and intimidation continues to permeate numerous workplaces. In these micromanagement, and an overall lack of respect.
Research conducted by Goleman, Boyatzis, and McKee (2013) suggests that when leadership uses fear as a tool to drive performance, employees may feel pressured into a constant fight-or-flight state, which hampers their ability to thrive. Employees under stress exhibit various reactions, ranging from aggression and avoidance to stalling out or burnout, which ultimately degrade productivity, morale, and engagement.
These adverse effects are not just limited to individual performance but can also harm the broader organizational culture, making it difficult for the company to innovate or collaborate effectively.
The Five Reactions to Workplace Stress:
- Fight: Employees confront leadership resistance or aggression, often in response to constant pressure.
- Flight: Employees withdraw, either mentally detaching from their responsibilities or physically leaving the company.
- Freeze: Employees become paralyzed, struggling to make decisions or take action.
- Fawn: Some individuals excessively try to please their managers, sacrificing their well-being in the process.
- Flop: Burnout sets in, leading to decreased motivation and productivity.
When fear drives workplace behavior, employees are trapped in survival mode rather than thriving in a supportive, growth-oriented environment.
Building a Thriving Organizational Culture
In contrast to fear-driven workplaces, organizations that invest in internal customer service create a culture that fosters psychological safety and mutual respect. Leaders who prioritize the well-being of their employees set the tone for a supportive environment where collaboration, innovation, and trust flourish.
A prime example can be found in the supply chain industry, where a skilled employee was placed in a role that did not align with his background. Despite working long hours for over a year, the employee struggled to feel comfortable or productive in the new position. A more effective approach might have been to hire someone with the requisite experience for the role, highlighting how mismatched job placements can hinder both individual performance and organizational efficiency.
Furthermore, misguided attempts to motivate employees, such as increased micromanagement or placing motivation slogans around the office, often backfire. In one notable case, a company attempted to combat poor morale by increasing supervision and posting motivational signs. The result was a rapid decline in employee engagement, ultimately leading to the layoff of 60% of the workforce. The lesson here is clear: organizational culture cannot be imposed through superficial measures. It must be nurtured with respect, trust, and genuine leadership.
Internal Service Shapes External Service
As Aristotle famously stated, “Pleasure in the job puts perfection in the work” (Pangle, 2013). When employees take pride in their work and feel valued by their employers, they naturally excel in their roles. This sense of pride and joy in their work is not cultivated through fear, but through an environment of support, fairness, and mutual respect.
The Dalai Lama’s words, “Our prime purpose in this life is to help others” (Lama, 1995), further emphasize the importance of leadership that seeks to uplift rather than control. Leaders who prioritize helping their employees succeed rather than using their own insecurities to exert power create a workplace culture where individuals can thrive.
Case Example: The Ripple Effect of Internal Customer Service
Consider an organization where internal customer service thrives. Managers respect their employees, and employees feel supported, valued, and empowered to contribute to the company’s success. In such a workplace, employees naturally extend the same respect and service to external customers. This leads to higher customer satisfaction, loyalty, and trust, critical elements that directly influence the company’s reputation and bottom line.
Conversely, organizations that fail to cultivate strong internal customer service often see the negative effects spill over into their customer interactions. A culture of fear and disrespect among employees often results in poor external service, as employees, feeling disengaged and unappreciated, transfer their dissatisfaction onto customers.
The Path Forward: Fostering Internal Customer Service
For organizations to succeed in the modern business landscape, they must recognize that leadership is not about exerting control or instilling fear. Instead, leaders should aim to create a supportive, respectful environment where employees feel valued and empowered to contribute. As Edmondson (2019) points out, organizations that prioritize psychological safety foster environments where learning, innovation, and growth can thrive.
Leaders can thriving culture by:
- Replacing fear with respect: Leaders should prioritize building relationships based on trust and mutual respect rather than relying on intimidation tactics.
- Shifting from micromanagement to empowerment: Instead of controlling every aspect of employees’ work, leaders should provide the necessary resources, support, and autonomy for employees to excel.
- Encouraging open communication: Creating channels where employees feel safe to voice their concerns and share ideas is key to fostering an environment of collaboration and innovation.
By fostering internal customer service, organizations not only improve employee satisfaction and performance but also lay the foundation for long-term business success.
Conclusion
Internal customer service is not just a “nice-to-have” concept; it is the backbone of thriving organizations. By shifting the focus from fear and control to respect and support, leaders can create an environment where employees feel valued, empowered, and motivated to contribute their best work. This, in turn, leads to stronger organizational cultures, improved employee performance, and better customer outcomes. Organizations that recognize the power of internal customer service will be well-positioned for sustained success in today’s competitive business landscape.
References
Edmondson, A. (2019). The fearless organization: Creating psychological safety in the workplace for learning, innovation, and growth. Wiley.
Goleman, D., Boyatzis, R., & McKee, A. (2013). Principal leadership: Unleashing the power of emotional intelligence.Harvard Business Review Press.
Institute of Organizational Psychology. (n.d.). Internal customer service and organizational health. Retrieved from https://organisationalpsychology.nz
Lama, D. (1995). The power of compassion. HarperCollins.
Pangle, L. S. (2013). Aristotle’s teaching in the “Politics.” University of Chicago Press.
Schauer, M., & Elbert, T. (2019). Dissociation following traumatic stress: Etiology and treatment. Journal of Psychology, 218(2), 109-127.
Schein, E. H. (2017). Organizational culture and leadership (5th ed.). Wiley.