Stakeholders

3 External Stakeholders

Stakeholder	Need/expectation	Example
Community at large	General public can be a stakeholder,esp if their lives are affected by an organisation’s decision	Local residents’ attitude towards out-of-town shopping centres
Environmental pressure groups	Does not harm the external environment	If airport wants to buy a new runway, the pressure groups may stage a ‘sit in’
Government	Company activities=central to the success of economy.Eg. providing jobs& paying taxes. Legislation (e.g health&safety) must be met by the company	Actions by companies could break the law, or damage environment &governments therefore control what organizations can do.
Trade unions	Active in the decision-making process	If a dept is to be closed, union’ll want to be consulted & there should be a scheme in place to help employees find alternative employment.

4 Stakeholder conflict

Stakeholders	Conflict
Employees vs managers	Jobs/wages vs bonus (cost efficiency)
Customers vs shareholders	Product quality/service levels vs profits/dividends
General public vs shareholders	Effect on the environment vs profit/dividends
Manages vs shareholders	Growth vs independence

*The problem with analysing stakeholders-
they tend to belong to > than 1 group& will change their groupings depending on the issue in hand

-Meeting the needs of most dominant stakeholders is important but other stakeholders' needs have to be considered-nearly every decision becomes a compromise.

Mendelows' power-interest matrix is used when org has difficulty deciding who the dominant stakeholder is.

Level of interest
Low	High	Level of power
Minimal effort	Keep informed	Low
Keep satisfied	Key players	high

-With this, dominant stakeholders/the key players can be identified.
-The needs of the key players must be considered during the formulation and evaluation of new strategies.
-Stakeholder groups can emerge& move from quadrant to quadrant due to specific event-->Change of position in the matrix occur.

Sources of stakeholder power:
Hierarchy: provides people/groups with formal power over others
Influence: may arise from personal qualities (leadership)
control of the government: knowledge, contact& influence of the environment.