What is the stakeholder?
An individual or group who has an interest in what the organisation does, or who affects, or can be affected by, the organisations actions
Companies are so large this could impact what?
Impact on society so pervasive that they should discharge accountability to many more sectors of society than solely their shareholders
Stakeholders are not only affected by the organisation but also
They affect the organisation
What are some examples of stakeholders?
Shareholders management customers employees suppliers, finance providers, community government
What are the three categories of stakeholders?
Internal connected an external
What are internal stakeholders?
Internal parties involved in corporate governments, e.g. employees and managers
What are connected stakeholders?
Invest in, or have dealings with the firm e.g. shareholders customers suppliers
What are external stakeholders?
No direct link to the firm e.g. local community government pressure groups trade unions
What are internal stakeholders needs/expectations?
Employees… Pay work conditions job security
Managers/directors… Status pay bonus job security
What are connected stakeholders needs/expectations?
Shareholders… Steady flow of income, possible capital growth, continuation of the business
Customers… Satisfaction of customers needs will be achieved through providing value for money products and service
Suppliers… Pay promptly
Finance providers… Ability to repay the finance including interest, security investment
What are external stakeholders needs/expectations?
Community at large… The general public can be a stakeholder, especially if their lives are affected by an organisations decisions
Environmental pressure groups… The organisation does not harm the external environment
Government… Community activities are central to the success of the economy. Legislation must be met by the organisation.
Trade unions… Taking an active part in the decision-making process
What are the different methods of categorising stakeholders based on?
Whether or not they have a contractual relationship with the organisation 
What are primary stakeholders?
Those that have contractual relationship for instance, employees directors shareholders in fact any stakeholder who falls into the connected or internal categories 
What are the secondary stakeholders?
Parties that have an interest in the organisation but have no contractual links such as the public any stakeholders in the external category would fall into this group
What would the conflict of a stakeholder be between employee versus manager?
Job/wages versus profit linked bonus
What would be the conflict of stakeholders of customers versus shareholders?
Product qualities/service levels versus profit/dividends
What are the stakeholders conflict between general public versus shareholders?
Effect on the environment versus profit/dividends
What are the stakeholders conflict regarding managers versus shareholders?
Independence versus growth
What can be used to decide who the dominant stakeholder is?
The mendelows power interest matrix
What do managers need to consider when making decisions?
As many stakeholders as possible, this means that nearly every decision becomes a compromise
What is a risk adverse stakeholder?
Aim for the best possible outcome in the worst case scenario
What is a risk neutral stakeholder?
Ignore the range of outcomes and aim for the highest average outcome
What is risk seeking stakeholders?
Aim for the best possible outcome in the best case scenario
