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Business Objectives And Strategy > Stakeholders > Flashcards

Flashcards in Stakeholders Deck (15):
1

What’s a stakeholder

A person/party with an interest in the success of the business

2

What’s an internal stakeholder

Found within the business

Owners
Employees
Managers

3

What’s an external stakeholder

Found outside the business

Suppliers
Lenders
Customers
Local communities

4

Why is having stakeholders important

To help analyse the operation of a business

Setting business objectives

Strategy is comes up with to reach the objectives

2 way relationship as the business affects the stakeholders and the stakeholders affect the business

5

Who benefits from stakeholders?

All will benefit from a business’ success in theory but sometimes that’s not the reality of it

Even if they do all benefit they may not benefit equally

All affect each other with different actions that take place etc

6

The owner as a stakeholder

Can be single owner (sole trader) several (partnership or thousands of shareholders as a plc

After the best possible return on the money they invested into the business

Wanting to see the business grow = returns increase

On a time scale with short/tactical/long/strategic objectives to make sure they ensure that profit

7

Employees as a stakeholder

Employee action dependent on the business

High wage, bonus, job security, holiday play, sick pay

8

Customers

Want the best quality products and the lowest possible price

Product innovation so this years products are better than last years products

Good customer service

Paying in credit (months not all in one go) options

Stop buying from the business is it fails to meet what they want

Pressure groups formed to try influence the business generating bad publicity

9

Suppliers as a stakeholder

Suppliers losing an income if the business stops trading

Looking for its customers (businesses) to keep being successful so they have a profit

Looking for businesses to grow so that they can increase their sales to them

Look for repeat orders over “one offs”

Businesses building up a long term relationship with their suppliers - using them regularly, paying on time
=suppliers loyal and committed

Long term commitment with suppliers vs. Driving costs down for customers for a short period of time (delayed paying back time for suppliers, not being loyal to one supplier)

10

The government

Has an interest in the success of the business

More employed, less people paying of social security benefits, more tax revenue from employees and the business = active economy

Larger business expansion, more exporting, UK’s trading position improving

11

The local community as a stakeholder

New jobs
Greater spending power (decide from the competition)
Can improve quality of life =road improvements with more businesses about (external benefits)

Higher property prices
Higher crime rates
Congestion and pollution ie. building sites, factories, more people living there etc
Noise pollution
Bad smells
Bad area to live = property price fall

Businesses getting actively Involved in community projects (sponsoring a sports team)


Not a cost to the firm but will be paid/imposes upon by the local community

12

What are external benefits

The positive aspects to the community as a stakeholder for a business being in their community

(Local authority improving roads)

13

What’s external costs to the local community as a stakeholder

Costs not paid by the business but paid by society and the community

(Congestion, noise pollution)

14

What are social benefits to the local community as a stakeholder

The profit to the firm (social benefits) + the amount of road improvements etc. to the community (external benefits to society/community)

15

What are the social costs to the local community as a stakeholder

The labour costs and stuff the business pays (private costs) + the consequences/costs the community faces ie. congestion/pollution it faces as a result (external costs)