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Breaking Down 'Customer'

Test your knowledge - and maybe learn something along the way. Build a city of skyscrapers—one synonym at a time. Explore the year a word first appeared. Definition of customer 1: See customer defined for English-language learners See customer defined for kids.

Examples of customer in a Sentence She is one of our best customers. She's a pretty cool customer. Recent Examples of customer from the Web The power went out to 1, customers in the northern end of National City and the Bay Terraces and Skyline neighborhoods of San Diego about 8 p.

The vouchers were also distributed to customers waiting in line at the stores on Thursday. Cheese's calls out Build-A-Bear in new promotion," 13 July The company has been the leading adversary of Mr. Mattel has worked over the years to combat criticism and make Barbie more relatable to customers of all skin tones and body types with lines like the Fashionistas.

Barbie collectors hit Phoenix resort scene for convention," 13 July Chinese companies could use the same strategy, closing factories in that country, laying off workers and moving production into the U. Build-a-Bear Workshop is giving away free coupons to customers after its disastrous Pay Your Age Day event at stores on Thursday and launched a new pandemonium-free promotion. The city has, in recent months, been distributing Toter-brand trash and recycling containers to about 4, residential customers.

National French Fry Day is Friday, and in honor of the occasion, several fast-food chains are offering free fries to customers. Origin and Etymology of customer Middle English custumer , from custume — see 1 custom. Near Antonyms animal , beast , beastie , brute , critter ;. Related Words hominid , humanoid ; brother , fellow , fellowman , neighbor ; celebrity , personality , self , somebody ;. Phrases son of man ;. Other Business Terms amortize , caveat emptor , clearinghouse , divest , due diligence , emolument , green-collar , marque , overhead , perquisite.

Related Phrases cool customer customer base paying customer regular customer. Definition of customer for English Language Learners. Learn More about customer Thesaurus: Seen and Heard What made you want to look up customer?

Need even more definitions? I have not seen any discussions of Lean IT Finance yet Only truly variable expenses should be considered, according to some Lean accounting stuff I've read. Would that change the service definition debate? It can only be a service if the costs are truly consumption-based from the enterprise perspective? No manipulation of capacity white space, no rebates, no fictitious metering allowed? Would such principles be helpful or harmful?

And, there is the whole concept of service culture we haven't even touched yet. Independent of service financing, it seems to me that attempting to inculcate a service culture is beneficial, even down to the DBAs?

Mightn't a service catalog play a transformative role along those lines? As you all can see, I have more questions than answers. Nor could I read the debate with the detail it deserves, so apologies if I've misunderstood or overlooked key points. Even the after sales support and delivery may be the domain of others moving forward. A financial structure based upon services, not functions.

A services-based budget is key. With that budget we can identify rates based upon actual forecasts of demand usage and the overhead structure. We can identify the overhad that is applied from corporate activities like United Way and other required time-wasting.

We can identify overhead that is from cost drivers vs. It's about getting to a rate for each service. It's about knowing how much each "service" will be selling to other services and how much they'll be "buying.

It's about washing out the overcounted overhead. Time-Driven Activity-Based Costing is easily adaptable to services organizations and can easily be adapted to those organizations that have time-tracking or work order driven activities - such as Design for Six Sigma.

TDABC works of data captured from the time capture and can explicitly be incorporated into any request fulfillment process at the transaction level. Both are data-driven and fact-based. Both promote accountability and ownership among operating employees.

Lean projects eliminate waste within departmental processes. TDABC deals with factors that cause complexity within processes. Lean accounting is a costing method that supports creating value for the customer by costing the entire value stream.

An interesting side effect of making everything a service - whether a customer facing service or an internal only supporting service - is that all service provision is priced. The combination allows teams to know where to apply their priorities Pareto , measures rework, cost of quality, etc.

There is generally little argument about needing evidence of pricing once a Service Catalog is produced, particularly a self-service request catalog. The first question, like a menu in a restaurant, is, "how much? Having priced services, based upon prices that are transparent and trusted, are important to "alignment.

That's a real crowd pleaser that often makes a big difference in satisfaction and perception. It all starts with a change to service-based budget. In Flores, Fine and DuMoulin's fine book - this is a top-down budget approach with a bottom-up approach to defining the individual self-service services.

Get your activity-diagrams with swimlane skills revved up! Can I reiterate how important and useful I think this debate is? I know it might appear academic to some, but there are already organisations out there who are sinking their entire transformational ITSM resource into going down the line of "everything is a service". I suspect for some, especially those who have integrated it with a sensible out-sourcing strategy, it will work well.

For others it will be an unnecessary distraction. Trying to combine Rob's point with Charlie's I wonder if the litmus test is "It is a service because there is a customer who recognizes what they are receiving to be a service" To make a bridge to Cary's comment you might add "and is prepared to be charged for it as a service". Somewhere on this site , a long long time ago, I think I posted a slide to show that back in the mid 90s we were trying to follow the costing approach laid out by Cary, influenced by the early writings on ABC and target based costing.

Whilst I remain committed to the idea I can't think of an example where I've seen it carried out in practice within the IT world. I suspect the catch is that to build the model successfully you need to have a good idea to begin with of what the answer is - a bit like using a slide rule. If I want to act as if I am delivering a service then it s a service even if the customer initially doesn't perceive it that way I bet they soon will.

Likewise if a customer wants to consume it as a service then I better comply pretty quick else they'll go somewhere else. Pure theoretical models always fail to perfectly model the real world because we reduce all models to simplifications in order to make them manageable.

There are no clean abstract definitions of "what is a service" in the real world. I think a service is a service when we treat it like a service. To go back to my last comment about a DBA playing grown-ups by saying they are a service provider: I won't be patronising about it if they really are treating it as a grown-up service.

A service is something that has the ITSM practices and artifacts wrapped around it to make it a service. A plumbing contractor provides a service - likely more complex than a single plumber. The plumber sells his service to the plumbing contractor. A general contractor provides a service - likely more complex than a single craft.

The plumbing contractor sells his service to the general contractor. Every electrician, machinist in a plant, doctor and his charge code, lawyer and his client - track their costs and their services. They don't waste "vast amounts of time" tracking their time. In fact, in many cases they get work orders and charge numbers before they are allowed to work at all.

Why is it that so many crafts and professions can do it - with systems created by IT - but IT cannot? What we seem to be disagreeing about is that I believe that supporting services - DBA or plumber - "sell" their services up the value chain. You seem to think they are an organic overhead. Each individual, each service - has a cost. At some point you have to account for that cost within a service.

You can estimate it if you like - allocations. When you do that, however, without some sort of Time-Driven Activity-Based Costing effort - you create a lack of transparency. Lack of transparency leads to mistrust. That may not be an issue for TCS.

The customer buys at a price you set - how you manage is up to you. Each company's CIO has to decide what they spend their money on. Whether they want to drive their work with work orders and build transparency and trust - or not.

Another question for you - if you're not driving your work with work orders, capturing who does the work and work times actual, elapsed how do you develop heuristics evidence-based time and cost estimates for a service? Track service failure costs?

Know who is accountable? How do you standardize? A plumber is a retail service provider. A DBA does not sell services, not in any org I've ever seen or heard of. Do they identify a market space and set portfolio strategy? C'mon this is yet another terminological debasement: A DBA saying they are a service provider is like a little girl staggering around in Mummy's lipstck and high-heels pretending to be a grown-up. As I've blogged before it's worse than that: James This is a good point.

There is a distinct cost in defining things a service. Sometimes I think that some of my most valuable consulting contributions are when I tell customer not to do something. It is so easy to do and buy unnecessary things. Another interesting point is the multisourcing model. It is interesting to see where this one outsourcer over others -model will lead, hopefully no to this:.

One Outsourcer to rule them all, One Outsourcer to find them. One Outsourcer to bring them all and in the darkness bind them sorry, remember you are not a Tolkien fan.

What I hear in the market is that people feel that they are insignificant as small customers to a large outsourcer and there seems to be more and more small players in the market.

Actually some of these small outsourcers buy services from bigger ones. For the customer it means that the service has a human face. I think it is fair to say the Service Integration market is in very early days.

Currently it seems to be being driven by third party advisers, rather than organisations deciding for themselves that it is the way forward. On the other hand it does address very real issues such as the skills gap in many retained organisations.

USMBOK - a consumer is any person or community who may or does consume the resources of a service provider. Borrowed from commercial marketing speak. Depending on the service industry, a consumer may be called by another name keep it clean!

Customer - Online store: You get my drift. Lean tends to use consumer as they consume resources. The terms consumer and customer are inter-changeable and most folks get it - except some in IT it seems - quelle surprise. Here goes IT again complicating matters I suspect. Consumers like stakeholders have an 'interest', this must be defined when building 'pictures of your customers' thanks to Barbara Bund.

This allows us to differentiate between a buyer and a user. The key think to ask if you are working in IT is "what business are we in". As I am sure I've blogged elsewhere, if you ask an airline that they might say "we fly planes". An airline's business is to transport passengers from A to B - in a timely manner! IT must ask what business they are in. What seems to be part of the discussion is that some define a service as what is delivered to a customer - an external customer.

I define a service as what is delivered, experienced, or whatever to a customer - external or internal. From a Service product manager's point of view the external customer viewpoint is what he's primarily concerned about.

But, since many of us in this discussion have been product managers, we all know that we assemble services from many other services - we "buy" services internally. What is complicating this is that we can, increasingly, "buy" services from outsourcers, cloud, etc. It's not really the delivery of services I'm discussing, but how we assemble services to deliver. It seems to me that IT is, increasingly, to rely on cloud, outsourcers, etc.

How we manage those suppliers, how we assemble those services, how we manage the contracts and the finances - that will be the test in the future. My point here is also one that James points out - most IT organizations have a very low maturity when it comes to the skills and processes necessary to manage this issue - IT financial management, IT asset management, IT contract management, IT procurement, IT designed and structured as services and not as process functions.

Organizing and controlling that budget in modular, loosely coupled way instead of the tightly-coupled, highly-integrated way that is traditional, is likely to be a paradim shift for IT organizations.

But, if we're to intelligently exploit the purported economic advantages - don't we have to make this change? And, if we don't, won't those companies that have more mature IT organizations be able to exploit the cost-savings and agility that we're not able to?

My point remains that there is a distinction between being able to do something and it being the right thing to do. Yes we can un-bundle IT in a lot of ways, and source each bundle individually on a best of class or lowest cost or whatever basis. Equally we could go to one mega supplier and leave it to them source the services and exploiting economies of scale. Both are perfectly feasible and valid options. Equally both have risks and costs attached to them.

For that matter who is the "we"? If you can unbundle services do you actually need a central retained It organisation at all - are we about to witness a new form of shadow IT forming?

All your examples are paying customers, execpt the patient when healthcare is free but as you live in USA, you probaly did not consider that. Our public healthcare has the same problem as IT. The customer is the City or County which pays for the service and the patient is the poor consumer.

The problem has been that the patient has not had any right to choose. In most instances the system still works suprisingly well as the medical profession has high standards, but there are cases where it does not. In this case the patient, i. Now our government is changing the rules and giving the consumer more power by letting the patient choose freely where to go. This will change the picture as the hospital gets their money per patient and the patient becomes more of a real customer even if she does not actually pay anything for the service.

But otherwise, I agree. The consumer is a stakeholder and has some power and the people who are working in the service organization must understand why they are working. This notion of distinguishing who pays for the service versus who consumes the service is useful when designing the service, but doesn't seem to be relevant when delivering the service. Making sure it is fit for use and fit for purpose is essential.

We don't want to over design things that nobody wants to pay for. However, once the Service is in use, the consumers of those services should be treated independently of whether they are actually paying for the service or not. How the service is delivered to them doesn't change whether they pay the bills themselves or I pay them. In the corporate world, a member of the sales team that uses the order processing service doesn't directly pay for it, and it shouldn't matter.

The payment for that service comes from a variety of places, but ultimately, the company is paying for the cost of providing that service.

If the service extends all the way to the businesses customers, for example an airport kiosk for checking into my flight, then as a paying customer of the airline who purchased a ticket, I am not paying anything extra for the Kiosk service, but I do consider it an extension of my original purchased service of getting from A to B. My overall point here is that who pays for the service should be irrelevant when delivering the service.

This is a bit like the debate about VIP users. There are those who are vehemently opposed to the idea that some people should get a better service "just because they are senior", others who see it as part of alignment with the business and who like the identity of VIPs and the criteria for inclusion in that category to be transparent and those who use VIPs as part of a political game. Understanding that customers, consumers and users have different requirements and should be serviced in different ways is not the same as saying we are offering users an inferior service, as such.

To take the salesperson, yes they are important when they are using the sales processing service, but how relatively important they, their activity, and the sales process order system as a whole are to the organisation is a customer choice.

In a situation where you have to decide which of two services to restore first the choice is again primarily a customer choice. The other obvious way in which the needs differ is in terms of the service reporting the different groups need or want. As a user I might be less interested in overall service levels than in the service specific to my transaction. The customer might not be bothered that a specific transaction has failed as long as the overall service levels are being met.

I suspect most of us in our careers have come across systems that were supposed to achieve one objective during conception and design, but which in delivery ended up delivering a different functionality in the view of users. The kiosk is relevant to a different debate.

For instance it can be substituted with a different kind of service, such as on line check in. Of course you can break the airline service down intro a whole series of mini-services, but you need to understand how they relate to the overall service. I've found the Kano model quite useful for thinking that through. James, I understand and agree with your points. By the way, I am on the side of the VIP discussion who disagrees with providing superior service to VIP's just based on the status of the person.

Your example supports my statement that during the delivery of the service, identifying the customer is not necessary. When delivering support for the services, the IT staff need not understand who pays for the service. This shouldn't be a part of the decision process to decide which service to restore first. They will choose their own service that they paid for. Rob started this thread by stating that "If I see another analogy comparing IT services to a restaurant I'm going to throw up".

At the risk of him throwing up, I will respectfully disagree with the relevance of the analogy. In the restaurant, you typically have a group of people dining at a table. It is fairly common for a single patron amongst the group to be the 'customer' and pay the entire bill.

While everyone else eating would be considered 'Consumers'. They are not directly paying for the service, but they are certainly recipients of the service. I just knew which camp you were going to fall into on the VIP question, but that isn't incompatible with the second option. If people have VIP status because what they re doing is intrinsically important, and they also happen to be of high status then I have no problem with that. Some organisations even manage their VIP lists dynamically based on the role, rather than the actor.

During delivery of the service the ghost of the customer should always be present. That sounded a lot better in my head than it does written down.

Your situation with the two paying customers is usually resolved in an internal situation by identifying the customers at CXO level. I might have a figure for IT spend on my budget, but if I can't flex that figure, or influence how it is spent, am I really a paying customer or just a consumer? In an outsourcing model it isn't unusual for the order in which services get restored to be a commercial decision based on account size or some other criteria.

And that is a key point, in deciding which user is currently our priority we will take a number of criteria into account, not just who is the customer, but those criteria have to be aligned with the customer.

Back to that restaurant analogy. Imagine that table of people isn't a family group or friends out to dinner, but a team of consultants having an audience with a senior partner. The dynamic is incredibly different. And so to your final question. The point is that it is posed as a rhetorical question, but in the real world it needs a pragmatic answer.

Perhaps the smaller table is less important, but by serving them first I maintain a better flow through the system with less total waiting time for everybody in the room - Hey we've invented ITSM Utilitarianism! Those are dangerous ways of thinking.

The exhibitors come only if the attendees come. Wait till you see a conference with more exhibitors than attendees. The Soviet style did not work for Soviet Union and neither will it work for any corporation.

The user-customer distinction is greatest in hierarchical organizations like hospitals , but it is not a good model. I think Captain Abrashoff explained it quite well in Pink 11, the captain has to listen to what the crew needs.

In most organizations the customers are also users, downtime may annoy the boss more than the staff who just take a break.

Then there is the completely ignored segment of IT services; business to consumers. Consumers buy IT services directly.

Or is there a separate Rob the User who bitches at Rob the Customer who buys crap services? In recent moths I have become increasingly concerned about the number of IT managers I meet who seem to have suddenly converted to the view that everything IT does can and should be treated as a service.

So I see things such as "Database Administration" becoming a detailed entry in the service catalogue, telling the "customers and users" every detail of what the DBA team does. This is accompanied by supposedly negotiated service levels, and a dedicated DBA service manager. The net result of this is an IT bureaucracy and management overhead that confirms many people's negative view of ITIL. It seems that once again a smell element of what makes up an effective ITSM approach has been elevated to the status of a silver bullet.

Going back to my earliest involvement with ITIL, in v1 training days we always opened the managers course with a discussion of the product-service continuum. At the same time I was involved in the early stages of UK central government's move towards outsourcing services under the "Market Testing" banner. One way or another I have been involved in outsourcing ever since, moving at times between the roles of adviser, customer and provider. What strikes me in hindsight is how often IT departments have conjured up an artificial and arbitrary concept of customers.

Inevitably what follows from that is a misunderstanding of how the market operates and IT strategies that reveal just how out of synch IT is with the business. I have also doubts of the concept of IT as business within business. If it is business then there should be competition, monopoly is not a nice form of business but I doubt that the internal IT really wants to have competition. Internal IT is a part of the business and if it well run, it helps the business to succeed using its special capabilities.

In the times of V1 managers did not touch keyboards. I don't think it has anything to do with class. If anything the last twenty years has seen a shift in British culture towards the citizen as a customer with choices rather than a dumb recipient of what is dictated by the great and the good.

It does have everythignt o do with market forces and spending choices. Coming from an outsouricng background I'm also aware that there is a complex framework of obligations - neither the customer nor the supplier operates with total freedom.

Yes, you are right. A corporate user is rather helpless, but one hears more and more stories of people taking things in their own hands. In a recent interview a person told that he has two laptops on his desk. One is the "official" and useless and with the other he does all his work. The real danger in the user-customer thinking is that IT people will consider users as second class citizens and treat them correspondingly.

There are two possible sides to this. One is the user who chooses to bring in their own device because it suits their way of working better. This can be done with varying degrees of official approval. A second case is where the organisation actually expects the workforce to provide their own equipment. An interesting question would be what factors does the user's own kit address that the corporate offering doesn't. In my experience to date it seems that small size and the ability to use entertainment and social media are big attractions, not the impact on the core functionality of the business services they are accessing.

Differentiating users from customers does not mean discriminating against users, but it does mean being realistic about how the needs of an individual user stack up against overall needs of the organisation and, yes, the overall politics of the organisation. Restauranteur ITIL customer sets the menu, decides what should be on the wine list, the grade of table-service, price to customer. Suppliers ITIL suppliers provide raw ingredients, kitchen equipment, maybe cleans the toilers because nobody wants to do it.

Only issue with this is that most restaurants, the customers and the customers don't get a heck of alot of choice, but there's no reason as to why if the food is terrible, then the customer user should be able to request and pay a premium for something better via restauranteur customer approval.

In an airport, yeah sure I am a customer. I am receiving a service from the airline, the airport company etc. Sure there are IT services involved - notifying me of flights etc. If the IT service is wrong - I don't get pissy at the IT dept or outsourcing company, I get all hot and bothered at the airline.

The airline however probably DOES see their IT dept as providing a service to them - giving value by helping them to provide a good service to the traveling public. DevopsDays Wellington, November Useful stuff I have been producing: Want the IT Skeptic to speak at your online or real-world event?

You may have noticed Google and Amazon ads on the site, as well as ads for my books and merchandise. I make money off them, but sod all. At least it covers the hosting with a bit left over. Skip to Main Content Area. Lively up your online or real-world event with The IT Skeptic. Please recommend this blog. Who is the customer? Submitted by skeptic on Sun, Share this post with. View the discussion thread. Comments Submitted by skeptic on Fri, Submitted by Madeleine not verified on Fri, Parents and Children I got tired of the Restaurant analogy long ago.

Submitted by hazyitsm on Tue, IT as caterer Skep, I see your point as this: Submitted by JamesFinister on Tue,

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In sales, commerce and economics, a customer is the recipient of a good, service, product or an idea - obtained from a seller, vendor, or supplier via a financial transaction or exchange for money or some other valuable consideration.

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The power went out to 1, customers in the northern end of National City and the Bay Terraces and Skyline neighborhoods of San Diego about 8 p.m., according to the San Diego Gas & Electric Co. website.

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2. Quality control: Entity within a firm who establishes the requirement of a process (accounting, for example) and receives the output of that process (a financial statement, for example) from one or more internal or external suppliers. When asked who is your customer, companies often tell us that they serve many customers. This includes internal and external customers, distributors, buyers, influencers, employees, and so on. Calling them all “customers” is common, even acceptable.

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However our customer and the consumer are not strictly speaking the same. A customer is a person or company who purchases goods and services. A customer becomes a consumer when he or she uses the goods or services i.e. . Customer definition, a person who purchases goods or services from another; buyer; patron. See more.