3.2.3 Flashcards
(22 cards)
What is a stakeholder?
A group/individual that has an interest in a business
What is a primary stakeholder? Give 2 examples
Someone that has a financial interest in a business is affected by a particular activity
- Shareholder
- Employees
- Managers
What is a secondary stakeholder? Give 2 examples
Someone that has no direct functional or financial relationships with a business
- Local community
- Government
- Suppliers
What are shareholders needs, interests and power?
Needs:
- Steady ROI
- Investment that does not lose value
- Preferential treatment as customers
Interests:
- Profit growth
- Share price growth
- Dividends
Powers:
- Can elect directors
- Can sell shares
What are employees needs, interests and power?
Needs:
- Steady/regular income
- Safe working conditions
- Job security
Interests:
- Salaries and wages
- Job security
- Job satisfaction/motivation
Power:
- Staff turnover
- Industrial action
- Service quality
What are customers needs, interests and power?
Needs:
- Reliable supply of goods
- Clear pricing strategies
- Safe products
- After sales service/technical support
Interests:
- Reliable quality
- Value for money
- Product availability
- Customer service
Power:
- Revenue
- Word of mouth recommendation
What are suppliers needs, interests and power?
Needs:
- Frequent orders
- Sole supplier agreements
- Fair prices
Interests:
- Long term contracts
- Prompt payment
- Growth of purchasing
Power:
- Pricing
- Quality
- Product availability
What are the local community’s needs, interests and power?
Needs:
- Steady employment
- Avoidance of environmental issues
- Avoidance of provision of facilities
Interests:
- Environment
- Local jobs
- Local impact
Power:
- Indirect via local planning and opinion leaders
What is stakeholder mapping?
A technique that maps stakeholders on the basis of power and interest which can help a business to make decisions in relation to stakeholder needs
What are the 4 quadrants labelled in stakeholder mapping?
HP, HI = Manage closely
LP, HI = Keep informed
HP, LI = Keep satisfied
LP, LI = Monitor with minimum effort
What is stakeholder conflict?
Where stakeholders disagree on a decision made by businesses, usually because it doesn’t apply to their objectives.
What is stakeholder overlap?
Where stakeholders agree on a decision made by the business
Give an example of a decision a business would make, including the stakeholder interests that would overlap and conflict
Decision = Relocate overseas
Overlap = Shareholders, managers
Conflict = Employees, suppliers
What is stakeholder engagement?
A process by which managers involve individuals and groups who may be aftected by their decisions in those decisions
What are the 5 stakeholder engagement approaches?
- Partnership
- Participation
- Consultation
- Push communications
- Pull communications
What is consultation?
A process by which one group discusses/discovers the views of another group
What is communication?
The exchange of information or ideas between two or more parties
Describe partnership and give an example of a stakeholder who we may use this approach with
Shared accountability and responsibility. Two-way engagement in joint learning, decision making and actions.
eg. Shareholders, managers
Describe participation and give an example of a stakeholder who we may use this approach with
Part of the team, engaged in delivering tasks or with responsibility for a particular area/activity. Two-way engagement within limits of responsibility
eg. Employees
Describe consultation and give an example of a stakeholder who we may use this approach with
Involved, but not responsible and not necessarily able to influence outside of consultation boundaries. Limited two-way engagement: organisation asks questions, stakeholders answer
eg. Local community
Describe push communications and give an example of a stakeholder who we may use this approach with
One-way engagement. Organisation may broadcast information to all stakeholders or target particular groups
eg. Employees, customers
Describe pull communications and give an example of a stakeholder who we may use this approach with
One-way engagement. Information is made available, stakeholders choose whether to engage with it
eg. Shareholders (with low shares)
