Employees as customers

It has long been recognized that marketing cannot be exclusively concerned with issues external to the organization. The implementation of any change, such as the move to a RM approach, must be supported by corresponding changes within the organization, not only in terms of systems and structures but also in the attitudes and abilities of staff. More than twenty-five years ago, Leonard Berry first coined the term internal marketing, which he defined as ‘the means of applying the philosophy and practice of marketing to people who serve external customers so that (i) the best possible people can be employed and retained and (ii) they will do the best possible work’ (Berry, 1980).

The focus of Berry’s conception of internal marketing was on employee recruitment and motivation, with a view of the employee as the customer and the job as the product. Although he developed the concept as part of an attempt to identify the differences between services marketing and its manufacturing counterpart, his approach to the development of internal marketing practice was informed by traditional approaches to marketing. Hence his assertion that ‘The processes one thinks of as marketing – for example, market research, market segmentation, product modification and communications programming – are just as relevant to internal marketing as to external marketing’ (Berry, 1983 in Payne et ah, 1995: 72)


Internal marketing as a change management tool

Although Berry’s contribution in developing this area of marketing theory is significant, others have criticized his approach to the subject as being too narrow, and have built on his initial work. The literature on internal marketing is now broad, complex and often contradictory, stimulating debates that mirror those on external marketing.

Based on an extensive review of the literature, Rafiq and Ahmed (2000) identify five elements of internal marketing:

Employee motivation and satisfaction: as seen in the work of Berry discussed above, many writers see internal marketing as a vehicle for staff acquisition, motivation and retention, which, it is argued, leads to greater productivity and external service quality.

Customer orientation and customer satisfaction: Berry and his supporters saw the creation of employee satisfaction as an end in itself, albeit one with positive consequences for external customers. In contrast, Gronroos (1985) presents internal marketing as a vehicle for the explicit promotion of customer-orientated behavior.

Inter-functional coordination and integration: these are key elements of the marketing orientation as defined by Narver and Slater (1990). Hence Winter (1985), for example, recommends the use of internal marketing as a tool for aligning the efforts of the various functions within an organization.

A marketing-like approach to the above: clearly, there are other tools and techniques developed in other business areas that can achieve the functions identified above. Internal marketing must, therefore, look to marketing principles and practices in order to design and implement its programmes.

Implementation of specific corporate or functional strategies: authors such as Piercy (2002) present internal marketing as a crucial stage in the implementation of strategic change. In this context, internal marketing is used as tool to generate understanding and support for strategic change, removing barriers such as complacency, the misallocation of resources and internal politics.