Identification of stakeholders:
Stakeholders are parties connected to organisation's success/failure. It
includes …………….
Stakeholders’ classification
Ø
Direct and Indirect Stakeholders
Ø
Internal and External Stakeholders
Ø
Narrow and Wide Stakeholders
Ø
Primary and Secondary stakeholders
Ø
Active and Passive Stakeholders
Ø
Voluntary and Involuntary Stakeholders
Ø
Legitimate and Illegitimate Stakeholders
Ø
Recognised and Unrecognised stakeholders
Ø
Known about and Unknown stakeholders
Stakeholder mapping (Mendelow power-interest matrix) is
based on stakeholders' power and their willingness to use it. Powerful stakeholders ………………
Influence = Interest
* Power
Stakeholders’ conflict
Conflict between stakeholders
occurs, when they fight for same resource or when interest of one stakeholder's
overrides interest of other stakeholder. In any one grid of Mendelow
matrix, if there is only one party (eg management) then there is unlikely to be
any conflict in a given decision-making situation. If there are several and
they disagree on the way forward, there are likely to be difficulties in
decision making and ambiguity over strategic direction.
E.g. Shareholders require high return whereas employees want
pay rise.
Resolving conflicting objectives (Cyert and March):
Conflicting interests/objectives can be resolved by prioritising (ranking
conflicting interest and resolving simultaneously), negotiating (between
conflicting parties and agreeing into optimal interest), sequential attention
(priorities are ranked and resolved one by one), side payment (benefiting with
finance instead of required objectives) or exercise of power (forcing through
decision/policies).
Strategy and stakeholders:
Instrumental view of stakeholders: Considers stakeholders as
instrument/means to achieve an end.
Normative view of stakeholders: Considers stakeholders as an
end in themselves not merely the instrument to achieve an end.
Seven Positions along the continuum (Gray, Owen and Adam)
Ø
Pristine capitalist – Strict focus on
shareholders wealth maximization
Ø
Expedients – Strict focus on shareholders wealth
maximization recognizing some social responsibility to create favourable image
and increase wealth
Ø
Social contract position – Focus on shareholders
wealth maximization complying social laws, regulations for renewal of licence
Ø
Social ecologist – Recognise that business have
social and environmental footprint
Ø
Socialist – considers equal benefit for
stakeholders not only the shareholders/financiers
Ø
Radical Feminists – business with connectedness,
equality, dialogue, compassion, fairness and mercy
Ø
Deep Ecologists – believe that every spices have
equal right to exist as human do
ACCA Article: All About Stakeholders Part1
ACCA Article: All About Stakeholders Part2
No comments:
Post a Comment