Stakeholder Analysis

Stakeholder Analysis In the business lineup their are many stakeholder that are attached with an organization. Some of stakeholder can effect the organization very badly and they turn the dynamic organization into the static organization. All organization whether they are corporate or    publ public ic they they have have thei theirr on stak stakeho ehold lder er depen depends ds upon upon thei theirr area area of opera operati tion on and demographic conditions. For a successful organization it is necessary to analyses the area of the stakeholder that are effected or effected by the organization policies.

Stakeholders: A stakeholder is any individual or group who can affect of is affected by the action decisions, policies, Practices, or goals of the organization.

Stakeholder Analysis: It is a framework that enables users to map and manage corporate relationships with groups who affect and are affected by the corporation’s policies and actions.

1) Mapping Stakeholder relationships: relationships: In this step organization identify their stakeholders on the basis of the following questions which are as follows:  Who are the current stakeholders?

As an the corporate organization organization customers are the major  stakeholders. who can affect and are a re affected by the corporation’s policies and actions.

 Who are Potential Stakeholders?

The potential stakeholder would also be the same as current stakeholders. There wouldn’t be any additional group in the future.  How does each stakeholder affect Gourmet?

Stakeholders can affect us with their boycotting power. As was with the example of gourmet cola. When the price of gourmet cola was increase the stakeholders (the customers) shifted to coke and as a result we had to reduce our   price back to its original price.  How do we affect each stakeholder?

We can immediately affect our customers with our decisions. E.g. if we want more customers we can lower the prices of particular items slightly.

1

Stakeholder map:

Gourmet (Firm)

2) Mapping stakeholder coalitions: Different coalitions have been formed among some of our customers and they managed to help us open up a new branch. These coalitions can also work against us.

3) Assessing the nature of each stakeholder’s interest: In this step I will assess the nature of our customers interest. Following are the interest of customers Low prices: • This is a standard interest. Almost all customers want low prices. Good Quality : All customers want good quality items/products. So, they basically want low  prices with good quality. •

•

Fresh products: Customers also want fresh products. E.g. fresh pizza or bread etc.

4) Assessing the nature of each stakeholder’s powers: In this step I will assess the customer’s powers Economic power: Customers have economic power i.e. they can boycott any product. For  exam exampl plee when when the the pric pricee of gourm gourmet et cola cola was was incr increa ease sed d the the custo custome mers rs with with thei their  r  Economic power boycotted gourmet cola and shifted to coke.

5) Constructing a Matrix of stakeholder Moral responsibilities: In this step I will construct a Carroll’s Matrix:

Carroll’s Matrix   r   e    d    l   o    h   e    k   a    t    S

Nature of focal company responsibilities Legal

 Customers Explanation of Carroll’s matrix:

Economic 

Ethical 

Voluntary 

2

Legal: Gourme Gourmett has legal legal respon responsib sibil iliti ities es on its custom customer. er. E.g. E.g. It’s It’s their their legal legal responsibility to sell unexpired products.

•

Economic: Gourmet also has economic responsibility. E.g. If they increase their prices customer’s will shift to their competitors.

•

•

Ethical: There is also Ethical responsibility between the customer and Gourmet

•

Voluntary: Voluntary responsibility is also present between the customers and Gourmet.

6) Developing Specific Strategies and Tactics and Formation of Typology: In this I will develop specific strategies based on the preceding steps. Following are some of the strategies We can approach the customers either directly or indirectly but mostly gourmet uses the direct approach Based on the previous steps the best strategy would be to do nothing with certain stakeholders with respect to offensive or defensive Finally, regarding whether to accommodate, negotiate, resist or wait and see with specific shareholder I think Gourmet should accommodate its customers. Typology: Following is the typology which has two dimensions i) Potential for threat ii) Potential for cooperation

Stakeholder’s potential for threat to Organization

  r   e    d    l   o   s    h   ’   e    k   a    t    S

High

Low

High Low





3

   h    t   r   i      n   o   w     o    f        t    l   n        i   o      a   a   i    i      z    t    t        i   a      n   n      a   e   r    t   e      g   o   p      r    P  o      o   o   c

Explanation of Typology: Low&Low: E.g. Gourmet is dumping its waste near a residential area. Now from normal   peopl peoplee there there is low threat threat to the organi organizat zation ion.. Likewi Likewise, se, the coopera cooperatio tion n level level  between the normal resident’s and gourmet is low •

High&Low:  Now if an IG or some high personality is living in that residential complex now the threat to Gourmet is high. But the cooperation level is still low.

•

7) Monitoring shifting coalitions: Finally, the last step is to monitor the changes in stakes and stakeholders by time and events. Following is the table of changes in no. of customers from 2006 to 2008. The reasons are also given.

Year

No. of Customers

Reasons

2006

Decreased by 40%

Increase in prices of  some products

2007

Came back to normal i.e. increased by 40%

Prices lowered back  to original prices

2008

No change in no. of customers

No changes to price and quality

4