Mgmt7007 Managing For Sustainability And Assessment Answers

Consider the models of stakeholder theory promulgated either by Freeman, Mitchell et al or Donaldson and Preston.Using one of these frameworks outlined in either the text or readings, construct a stakeholder map for an organisation with which you are familiar. You should include both internal and external stakeholders and be as comprehensive as possible. Using the model of stakeholder typology associated with your chosen framework, categorise these stakeholders appropriately. For example, on page 42 of the text , stakeholders are identified as dormant, demanding, dominant, etc.

Try to identify specific stakeholders that are currently being neglected by the current approach to business, especially those in the more influential categories (such as dominant, definitive and dependent). Then develop ideas on how you might correct the situation and engage more appropriately with these stakeholders. summarise your approach to mapping and develop some initial engagement strategies for those neglected but more powerful stakeholders identified in the course of the process.

Answer:

Introduction

Every organization creates value for its stakeholders, who include suppliers, employees, customers, financiers and communities. After the recent global financial crisis, many organizations learnt that the profit maximization idea for shareholders doesn’t work very well and is outdated (Van Riel, 2012). The idea today is that the executives of an organization are mandated to create as much value as possible for these stakeholders. According to Edward Freeman companies that are termed as great manage to align stakeholders interest in the same direction.

Internal stakeholders

Internal stakeholders of a company include employees, managers and owners. All these have different demands and expectations from the company. Some may think that that employees expectations from a company is overall compensation or pay, however, this is far from the truth since all they want is respectful treatment and trust between senior management. Compensations is important but good treatment at work place come first for the employees, job security, steady income, career advancement are also some of the important things to look at (Halderen, 2008). On the other hand, the owners expect maximum returns from their business, and they do expect the management to advice them on many important issues relating to the business such as where to get cheap financing the financing methods etc. But more importantly the owners are more interested in the profits as well as the going concern of the business (Phillips & Freeman, 2011). The managers want recognition, authority, empowerment and all things that come with the job.

External stakeholders

These stakeholders are more demanding, they include among others the shareholders; competitive performance, transparency from management and a good future value and present value of the investment. The suppliers only want regular orders that are paid in time, the lenders timely repayment of the loans (Phillips & Freeman, 2011). The local community wants a good neighbouring. The government wants prompt payment of taxes, availability of the services and products as well as employment opportunities for the public. The customers on the other hand want easy access to good quality products at competitive prices. 

Power, legitimacy and urgency

Stakeholders want various thing including power, legitimacy and urgency. Dormant stakeholders have the ability to impose their will however they miss urgency and legitimacy. an example is the community. Demanding stakeholder possess the legitimacy claims but have no legitimacy or power to impose them. Dominant stakeholders have both the legitimacy and power within the organization which gives them strong influence in the project. Dangerous stakeholders have legitimate and urgent claims but lack power (Schneider & Hollenczer, 2006). The only way to keep these stakeholders at bay is to keep them engaged and satisfied because they may use coercion or even violence. Dependent stakeholders on the other hand lack power, but have legitimate claims and urgency. These stakeholders need to be managed because they may choose to align with other stakeholders in the company and hence influence the project. Definite stakeholders have urgency, power and legitimacy and therefore they need to be communicated with adequately (Schneider & Hollenczer, 2006). Non stakeholders have no legitimacy,power and urgency hence there is no need to invest time in them. In conclusion, there is need to know the type of stakeholder inorder to keep them well informed for the sustainability of the organization.   

References

Halderen, M. (2008). Organizational identity expressiveness and perception management (1st ed.). Rotterdam: Erasmus Universiteit.

Phillips, R. & Freeman, R. (2011). Stakeholders (1st ed.). Cheltenham U.K.: Edward Elgar Publishing Ltd.

Schneider, J. & Hollenczer, L. (2006). The principal's guide to managing communication (1st ed.). Thousand Oaks, Calif.: Corwin Press.

Van Riel, C. (2012). The Alignment Factor (1st ed.). Hoboken: Taylor & Francis.