3.2.3 Understanding the role and importance of stakeholders

Question 1

What are stakeholders?

Answer 1

anyone with an interest in the business and its operations

Question 2

State at least 4 stakeholder groups

Answer 2

• Customers
• Employees
• Investors/banks
• Suppliers/distributors
• Shareholders
• Owners/managers
• Competitors
• The government
• Local communities
• Environmental pressure groups
• The media

Question 3

What does a stakeholder map look like?

Answer 3

Question 4

Explain the axes of a stakeholder map (power and influence)

Answer 4

Power = their part in decision making or how much they would negatively affect you
Influence = helps you when making decisions and prioritise stakeholders where there will be potential conflict

Question 5

What are different stakeholders (employees, customers, suppliers, govt, local community, owners, investors, shareholders) needs?

Answer 5

• Employees – happy environment, high wage, keeping their job, good & safe working conditions
• Suppliers – regular orders, contractual agreement, security
• Customers – low price, high quality, good customer service, value for money
• Government – wants businesses to do well, collect taxes (and raise them)
• Local communities – support local environment e.g new jobs, less pollution etc
• Owners and managers – dividends, happy employees, profit
• Investors and banks – repayments on time and with full interest
• Shareholders – regular dividends, how much profit the firm makes

Question 6

Draw a table showing the potential conflicts between shareholders.

who supports and who opposes this choice?

Answer 6

Question 7

State 6 factors that affect stakeholder relationships

Answer 7

• Quality of products made
• Information available
• How easy it is to communicate with them
• Their status
• Customer service
• Influence or power
• Workplace environment for employees
• How much money they have invested into the business
• Views on the environment
• Revenue produced
• Prices of products being sold
• Decisions made by the firm

Question 8

State ways of the business communicating with stakeholders.

Answer 8

• General meetings
• Letters
• Email and social networking
• Posters of advertising
• Public forums
• Media release