Within software development organizations, "eating your own dog food" denotes the common practice of an organization using the application that they design. This has obvious marketing implications: i.e., despite vocal criticism of open source applications, Microsoft appeared hypocritical for using FreeBSD, a Unix variant, to run their Hotmail web servers.
Beyond marketing, eating your own dog food has more direct effects on the design of the application itself. In the open source community, because so many contributors originally join a project to scratch their own itch, we suspect that most Linux developers use Linux, Mozilla developers Mozilla, OpenOffice.org developers OpenOffice, and so forth. Some critics of open source software have complained about the "developer-as-user," that open source software is too geek-centric and less sensitive to the needs of regular users for this reason. However, by using the application regularly for the purposes for which it is intended, there is less disconnect between users and developers simply because developers are users. Developers discover bugs, observe UI difficulties, and find common task and usage patterns. They gain a better understanding of user complaints and needs which leads to better prioritization in future development.