STAKEHOLDER NOTES
What are stakeholders? Who are they?
A person, group or organisation that has an interest or concerns in an organisation.
They can be affected or affect the organisation/business in terms of their actions, objectives and policies
for example…
- Creditors
- Directors
- Employees
- Government
Stakeholders at a school would be the…
- Teachers (employee)
- Parents (Customers/Company)
- Workers
- Students (Consumers)
- Janitors
- Bus company and Cafeteria (Suppliers, Outsource)
- GOVT (Pay tax, legislation to abide)
- Local Community (improve infrastructure in the area, help)
- Board of governors
Internal Stakeholders
are groups within a business or people who work directly within the business. e.g:
- employees
- managers
- shareholders
- owners
- investors
External Stakeholders
are groups outside a business or people who are not directly working within the business but are affected in some way from the decisions of the business. e.g:
- customers
- suppliers
- creditors
- community
- trade unions
- government
- competitors
Identification of stakeholders is an organized and systematic brainstorm exercise to find out who the parties are whose interests you should consider. This can be done either independently or in a group or team. Some questions which could help guide you, or your workshop is to propose the following:
- Who are the parties that are interested in the intended action? What role do they play?
- Which parties may be adversely impacted?
- Who are the beneficiaries of the action, who would benefit from the initiative?
- Who has the power to influence, or impact the initiative?
Why are they important you may ask?
When certain groups aren’t taken into account, when they aren’t heard, or when they are forgotten it is likely that you may have external problems arise. This can be anywhere from being put into the spotlight by various non-government organizations (NGO’s) by finding yourself the the foot of a protest, in a newspaper, or even on the news painted in a picture which may be damaging to your reputation. This could lead to scandals, consumer backlash towards your brand, and for public companies a dropping stock price.
Can you answer these questions? If yes – you are ready to move on to the next topic!
- Explain the difference between internal and external stakeholders.
- What is the difference between stakeholders and shareholders?
- Explain why employees are often considered to be the key stakeholders in an organization.
- Distinguish between a director and a manager of a company.
- How might pressure groups affect the success of a business?
- Outline the sources of stakeholder conflict in a business.
- How might businesses resolve conflict in the workplace?