Company ABC provides components directly to Company XYZ, which incorporates them into its product before...

Company XYZ is an external customer to Company ABC because it is a separate organization receiving ABC’s output. In Six Sigma terminology, an internal customer exists within the same organization and depends on the output of an upstream process, department, or function. An external customer exists outside the organization and receives the product, service, component, or information produced by the organization. In this case, Company XYZ purchases components from Company ABC and uses them in its own product, making XYZ an organizational customer outside ABC’s internal structure. It is not the final customer because the general public ultimately buys the finished product from XYZ. It is also not necessarily a distributor, since the scenario describes incorporation into another product rather than simple resale. Understanding customer type is important in Black Belt work because customer requirements, quality expectations, and CTQs may differ between internal and external customers. Supplier-customer relationships across organizations must be managed carefully to ensure consistency, reliability, and fit-for-use performance. Therefore, the correct answer is A, External, because Company XYZ is outside Company ABC and directly receives its components.

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