Organizational and Manageial Communication

Stakeholder Management Chapter 6

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Stakeholder

Any group or individual who can affect or is affected by the achievement of an organization’s purpose.

They have a ‘stake’ in the organization.Encompasses a broad range of groups and

individuals, some with little impact, some with great impact.

Edward R. Freeman, 1984, Strategic Management: A Stakeholder Approach, Marshfield, MA:Pitman.

Identifying Organization’s Linkages to StakeholdersWho are organization’s stakeholders?

No general group, but identified by common problem

Vary from case to case Dependent on what organization does and

how other individuals and organizations react to organization’s behavior

Key: What consequences of organization’s activities will have on its stakeholders and how do these consequences affect each other?

A Stakeholder Map

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Owners Financial Community Activist Groups

Shareowners Analysts Safety and Health GroupsBondholders Investment Banks Environmental GroupsEmployees Commercial Banks’ Big Business’ GroupsNational Banks Single Issue Groups

Suppliers Government Political GroupsFirm #1 Congress/Parliament Political Party #1Firm #2 Courts Political Party #2Firm #3 Cabinet/Departments National League of CitiesEtc. Agency #1 National Council of Mayors

Agency #2 Etc.

Customers Customer Advocate Groups UnionsSegment #1 Consumers’ Union Union of Workers #1Segment #2 Council of Consumers Union of Workers #2Etc. Attac Political Action Committees of Unions

Employees Trade Associations CompetitorsSegment #1 Business Roundtable Domestic Competitor #1Segment #2 Customer Trade Org. #1 Domestic Competitor #2Etc. Etc. Foreign Competitor #1

Specific Stakeholders of a Large Organization

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Customer Segment #1 Political Parties #1 and #2High Users of Product High Users of ProductImprovement of Product Able to Influence Regulatory

ProcessAble to Get Media Attention on

a National Scale

Customer Segment #2 Consumer Advocate #1Low Users of Product Effects of XYZ on the ElderlyNo Available Substitute

Employees Consumer Advocate #2Jobs and Job Security Safety of XYZ’s ProductsPension Benefits

OwnersGrowth and IncomeStability of Stock Price and Dividends

Stakes of Selected Stakeholders

Examples of Indirect or Coalition Strategies

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Classical Stakeholder Grid

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’Real World’ Stakeholder Grid

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Strategic planning including stakeholders

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The ’Stakeholder Dilemma’ Game

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Organization

StockholdersGovernmentRegulatorsBoards of DirectorCommunity Leaders

AssociationsPolitical GroupsProfessional Societies

EmployeesUnionsSuppliers

ConsumersIndustrial PurchasersUsers of ServiceEnvironmentalists

Community ResidentsVoters MediaMinoritiesWomenOther Publics

NORMATIVELINKAGES FUNCTIONAL

LINKAGES

INPUT

OUTPUTDIFFUSED

ENABLING

Method for MappingLinkages of anOrganization(Grunig and Hunt, 1984)

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Four Key Linkages

Enabling LinkagesFunctional Linkages

Input linkages Output linkages

Normative LinkagesDiffused Linkages

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Functional Linkage

Linkage that give input and take outputInput Linkage

Employees Unions Suppliers

Output Linkages Customers Other organizations Individual consumers

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Enabling Linkage

Organization could not exist without this linkage Authorities Shareholders Legal System

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Diffused Linkage

Elements in society that are not clearly identified as a formal member of organization Environmentalists Community Residents Media Other Publics

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Normative Linkage

Organizations that have common problems or similar values Membership organizations Professional groups Associations