Relationship between business and stakeholders

Diagram of stakeholder relationships | Organisational Overview | Merafe Resources

relationship between business and stakeholders

Every business takes a different approach to stakeholders. The roles of stakeholders differ between businesses, dependent on the rules and responsibilities laid. The relationship between stakeholders and the organisation go beyond strategic fit and other aspects of the business case, and 'needs to be refreshed by . Thus the effective management of stakeholder relations is growing as a key focus of PR You can use the viewpoints of the main stakeholders to help shape your What is their potential to influence the business directly or indirectly (via other.

Southwest Airlines has raised this to a new standard, offering a clear demonstration that low-cost and first-class-service are not at the opposite ends of the continuum. I absolutely cringe when I hear people say that employees want to 'feel' valued. The fact is that employees need to 'know' that they are valued. The best way to demonstrate rather than say that the work they are doing is appreciated by their colleagues and important to customers is by showing them how their role fits into the larger picture.

relationship between business and stakeholders

For example, the partnership between building materials company Lafarge and Habitat for Humanity International reconnected employees to the tremendous value that the products they helped create bring to thousands of people. In addition, a consistent theme running through Working Mother's annual list of Best Places to Work is that top employers treat their employees as their most valued assets by investing in their growth, engagement and satisfaction.

What Are Stakeholder Relationships?

A return on investment is critically important to owners and investors but at the same time there are people who will buy a stock think Disney or Apple because they appreciate what the company stands for as well. And there are people who will refuse to own and work for companies or industries that they find unpalatable, regardless of return such as tobacco or firearms.

A company's suppliers are critical to their success. The quality of the products that go into what you manufacture has a direct impact on the quality of the products that go to market bearing your brand. Making the right choice can enhance a company's reputation and increase the value of its brand.

Diagram of stakeholder relationships

Making the wrong choice can have a devastating impact. Therefore, companies must be sure to seek partners who share their commitments for reducing their environmental footprint, preserving and protecting human rights and a host of other issues. An often overlooked stakeholder for any company is its competitor, because often the actions of one player can influence the image of an entire industry or business in general. The oil spill associated with BP in the Gulf of Mexico resulted in a moratorium on all drilling, by all companies and damaged the image of safety and environmental responsibility of the entire industry.

Anyone who has tried and failed to get a business permit knows the power of local communities.

relationship between business and stakeholders

The board of directors has the power to appoint all levels of senior management - including the CEO - and remove them if necessary. Members of the board dictate the future of the company and are involved in all major business decisions.

relationship between business and stakeholders

Direct Management While the board of directors is a more "hands off" approach to controlling a company, some stakeholders prefer the "hands on" approach by directly assuming management positions. Stakeholders can take over certain departments - such as human resources or research and development - to micromanage the business and insure success.

Stakeholder Relationships: Key to a Sustainable Enterprise | HuffPost

In privately owned and publicly traded companies, large investors often directly participate in business decisions on the management level. Investors Stakeholders are regarded as large investors, who will either increase or decrease their stakes in your company according to your financial performance. Ideally, they act as guardian angels for everyday investors, poring over financial reports and pressuring management to change tactics if necessary.

Certain stakeholders, known as activist investors, will make wildly unpredictable investments and divestitures in order to move the share price and attract media attention to a certain issue. Carl Icahn is well known for this high pressure tactic, which is used to mold companies more to his liking.

Corporate Conscience Large stakeholders are generally high profile investors, and would like to steer clear of companies that trample human rights and environmental laws.

What Are Stakeholder Relationships? |

They monitor your company's outsourcing activities and globalization initiatives, and may vote against your business decisions if they are deemed harmful to the company's long-term goals.

Other Responsibilities Of course, this is only a broad description of stakeholder responsibilities. Ideally, you'll have stakeholders who care about these four issues, but more often than not, short-term profits take precedence over long-term sustainability.