Customers and stakeholders LO1528

David E. Birren, MB/5, 608.267.2442 (BIRRED@dnr.state.wi.us)
Tue, 6 Jun 1995 12:20 CST

Responding to Joe Podolsky in Re: Measurement in Education LO1509:

Joe says:

>I have had several discussions with people in the education community about
>who their customers really are. For example, one definition of a customer
>might be the "economic buyer"; i.e., they who have the gold makes the rules.

>How does it change our decisions, then, if we look at what the people with the
>money want. Parents often pay for the higher education of their children.
>What do they see as desirable outcomes? Other funding sources are scholarship
>grants and foundations. What do they want? Etc.

>And, given those thoughts, if the students aren't the customers, what are
>they? For example, are they the "product" of the schools?

These are excellent questions. In developing strategic plans and
wrestling with implementing quality concepts, my agency has struggled with
the distinctions among customers, clients and stakeholders. I'll try to
distinguish them in the hope of informing this developing thread. They
can be characterized by their distance from the process or function being
considered, but it is important to note that they are not mutually
exclusive.

A customer is the next person in the process. There is a direct
relationship between the person (or work unit) and the process; however,
the customer may not be the intended recipient of the process's outcome.

A client is someone for whose benefit the function is intended. There
is a direct relationship to the outcomes, without much regard for the
process.

A stakeholder has an interest (a "stake") in the outcome of the process,
but neither receives direct benefits from it, nor is explicitly considered
in its design. There is an indirect relationship to the outcomes; i.e.,
there are generally certain intervening variables that mediate that
relationship.

I've found these concepts useful in industry, education, and government,
and I'd be happy to hear others' views. It's easy to get hung up on
semantics, though, so I hope we can keep the discussion on the level of
concepts and relationships.

--
David E. Birren						Phone: (608)267-2442
Wisconsin Dept. of Natural Resources			Fax:   (608)267-3579
Bureau of Management & Budget		    Internet: birred@dnr.state.wi.us
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