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What is your question relating to customers and/or stakeholders?
What are stakeholders?
A stakeholder is any individual, group, or organisation that has an interest or concern in the activities or outcomes of an organisation or system. Stakeholders can include a wide variety of individuals or groups, such as customers, employees, investors, suppliers, partners, government agencies, and community members. Stakeholders can have both direct and indirect impacts on an organisation or system, and their interests and concerns may vary depending on their relationship to the organisation or system. For example, customers may be interested in product quality, pricing, and customer service, while investors may be concerned with financial performance and return on investment. Effective stakeholder management is important for the success of an organisation or system. This involves identifying and prioritising stakeholders, understanding their needs, expecations and aspirations, and engaging with them in a way that addresses their needs while also achieving organisational goals. By understanding and managing stakeholder relationships, organisations can build trust, improve communication, and create shared value that benefits both the organisation and its stakeholders. Integrated management requires that stakeholder needs, expecations and aspirations are addressed equitably. [MSS 1000 definition] A stakeholder is any individual, group or organisation that can affect, be affected by or believe itself to be affected by the organisation’s existence, assets or activities. NOTE 1: Typically, internal stakeholders comprise employees, managers and directors and external stakeholders comprise contractors, neighbours, competitors, shareholders, bankers, partners, insurers, pressure groups, trade unions, society, government, regulators, suppliers and customers. A stakeholder may exist in more than one of these classifications and therefore may simultaneously be both an internal and external stakeholder. NOTE 2: A stakeholder may exist globally and may even be as yet unborn. The interests of the latter are usually shared by the living stakeholders and exercise power on their behalf. NOTE 3: The nature of the organisation’s relationships with its stakeholders varies according to each stakeholder’s needs, expectations, aspirations, the potential for conflicts of interest, the ability to exercise power, their awareness and ability to understand the organisation’s operations and their values and morality.
See also: What is Integrated Management?
What are conflicting stakeholders?
A conflicting stakeholder is a stakeholder whose interests or concerns are in opposition to those of another stakeholder or the organisation itself. Conflicting stakeholders may have competing goals, priorities, or values that create tension and can lead to disagreement or conflict. Examples of conflicting stakeholders may include: 1. Employees who want higher wages or better benefits, while management seeks to maximise profits. 2. Environmental advocates who want a company to reduce its carbon footprint, while shareholders may prioritise financial returns. 3. Customers who want lower prices, while suppliers may want higher prices for their products. Conflicting stakeholders can present challenges for organisations, as it may be difficult to balance competing interests and priorities. However, it is important for organisations to recognize and address these conflicts in order to manage stakeholder relationships effectively. Managing conflicting stakeholders requires effective communication, collaboration, coordination and negotiation. Organisations can work to find common ground and identify solutions that equitably address the concerns of all stakeholders while still achieving organisational goals. This may involve compromising on certain issues, prioritising certain stakeholders over others, or finding creative solutions that equitably satisfy multiple stakeholders. It helps if stakeholders make their values, needs, expectations, and aspirations transparent before interacting. Publication of clear comprehensive integrated policy statements is very helpful in promoting mutual understanding, empathy and the avoidance of surprises. [MSS 1000 definition] Conflicting stakeholder is a stakeholder that has interests that does not or may not align with the organisation’s purpose or objectives. NOTE 1: Competitors and criminals typically have conflicting interests to the organisation.
How do stakeholders exercise influence and power?
Stakeholders exercise influence and power in various ways depending on their specific interests and objectives. Here are a few common ways in which stakeholders can exercise influence and power: 1. Economic Power: Stakeholders who control economic resources, such as large shareholders or suppliers, can exercise power by making financial decisions that impact the organisation. For example, they may threaten to divest their shares or withhold supplies in order to influence organisational decisions. 2. Legal Power: Stakeholders who have legal expertise or control legal resources, such as lawyers or regulatory agencies, can exercise power by using legal means to achieve their goals. For example, they may file a lawsuit or petition a regulatory agency to enact new rules or regulations. 3. Political Power: Stakeholders who have political connections or control political resources, such as lobbyists or government officials, can exercise power by using political means to achieve their goals. For example, they may lobby lawmakers to enact new legislation or regulations that benefit their interests. 4. Social Power: Stakeholders who have social influence or control social resources, such as customers or employees, can exercise power by using social means to achieve their goals. For example, they may boycott a company or use social media to pressure an organisation to change its policies or practices. Overall, stakeholders can exercise influence and power in a variety of ways depending on their resources and objectives. It is important for organisations to identify and understand their stakeholders and their potential sources of power in order to effectively manage relationships and mitigate potential conflicts. [MSS 1000 definition] Impact is the positive or negative effect on a person’s, an organisation’s or a stakeholder’s objectives, needs, expectations or aspirations resulting from an aspect of the organisation. NOTE 1: It includes effects on the organisation’s policy, commitments and objectives. NOTE 2: Objectives, needs and expectations include facets of performance such as those impacting humankind, environment and commerce.
Why is stakeholder engagement important?
Stakeholder engagement is important for a variety of reasons, including: Building trust: Engaging with stakeholders can help to build trust and credibility with the community, customers, employees, and other stakeholders. This can lead to greater support for the organization and a more positive reputation. Identifying and managing risks: Stakeholder engagement can help to identify potential risks and issues early on, allowing organizations to proactively manage and mitigate them. This can help to prevent negative impacts on stakeholders and the organization. Improving decision-making: Engaging with stakeholders can provide valuable input and insights that can improve decision-making. By understanding the perspectives and concerns of stakeholders, organizations can make more informed decisions that better align with the needs and expectations of stakeholders. Enhancing innovation: Stakeholder engagement can stimulate creativity and innovation by bringing together diverse perspectives and ideas. By engaging with stakeholders, organizations can gain insights into new opportunities and solutions that they may not have otherwise considered. Creating shared value: Effective stakeholder engagement can create shared value that benefits both the organization and its stakeholders. By understanding the needs and concerns of stakeholders, organizations can develop strategies that create positive social and environmental impacts while also achieving business goals. Overall, stakeholder engagement is important because it helps organizations build trust, identify and manage risks, improve decision-making, enhance innovation, and create shared value. By engaging with stakeholders, organizations can build stronger relationships, improve their reputation, and achieve long-term success. [MSS 1000 definition] Stakeholder engagement is activity undertaken to create opportunities for dialogue between an organisation and one or more of its stakeholders, with the aim of improving the making of evidence informed and evidence based decisions.
How should stakeholder analysis be conducted?
Stakeholder analysis is a process of identifying and assessing the needs, expecations and aspirations, influence, and importance of stakeholders in relation to an organisation or project. The following steps can be used to conduct a stakeholder analysis: 1. Identify stakeholders: The first step is to identify all potential stakeholders, both internal and external to the organisation or project. This can be done by brainstorming, reviewing project documents, or consulting with relevant experts. 2. Prioritise stakeholders: Once stakeholders have been identified, they should be prioritised based on their level of interest, influence, and importance to the project or organisation. This can be done using a stakeholder prospect and risk identification and prioritisation matrix or similar tools. 3. Analyse stakeholder interests: The next step is to assess the interests and concerns of each stakeholder. This involves understanding their needs, expectations, and concerns, as well as any potential impacts the project or organisation may have on them. 4. Analyse stakeholder influence: In addition to assessing interests, it is important to understand the level of influence and/or power that each stakeholder has on the project or organisation. This includes assessing their ability to affect decision-making, resources, or outcomes. 5. Develop a stakeholder engagement plan: Based on the analysis of stakeholder interests and influence, a stakeholder engagement plan should be developed. This plan should outline strategies for engaging with stakeholders, such as communication, consultation, or collaboration, as well as how to manage any conflicts or issues that may arise. 6. Implement and monitor the plan: The final step is to implement the stakeholder engagement plan and monitor its effectiveness. This may involve ongoing communication and engagement with stakeholders, as well as regularly reviewing and updating the plan based on changing circumstances or stakeholder needs. Overall, conducting a stakeholder prospect and risk analysis involves a systematic and structured approach to understanding the needs, expectations, aspirations, influence, and importance of stakeholders. By effectively analysing and engaging with stakeholders, organisations can build stronger relationships, maximise prospects, mitigate risks, and achieve better, quicker and cheaper outcomes. [MSS 1000 definition] Prospect and/or risk analysis and synthesis is the process used to identify and assess factors that may jeopardize the likelihood of an organisation, project or task satisfying the needs and expectations of stakeholders while making the best use of resources.
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