Satekholder Objectives and Strategic Managment Flashcards
What is a Stakeholder?
Is someone who has an interest in the success of a business
Why do Stakeholders want a business to succeed?
Because they will benefit from their success
What can the objective of stakeholders be used for?
Create a useful framework used to analyze the operations of a business Analyze business objectives and how they can be reached
Evaluative points for Stakeholders.
- How much they regard the business as a success - Which stakeholders are the most important - How stakeholders view change
Do all stakeholders benefit from a business equally?
NO
Stakeholder Objectives that businesses address - Employees?
- Employees who feel valued are more productive - Be less resistant to change - Less likely to leave
Stakeholder Objectives that businesses address - Customers
Customers who do not feel exploited and like that standard of the goods/service will become loyal customers
Stakeholder Objectives that businesses address - Suppliers
Suppliers who are seen as stakeholder rather than ‘suppliers’ are more likely to be loyal and committed. Useful in the short term (ie. needing a quick delivery)
What is a Key Stakeholder?
People with a large amount of influence on a business, they play an important part in decision making.
What does Porters Five Forces Model analyse?
Competition in a market
Porters Five Forces Model
What are Porters 5 Forces?
- Threat of new entrants into a market
- Bargaining power of suppliers
- Bargaining power of consumers
- Threat of substitute products entering a market
- Degree of existing competition in a market
Porters 5 Forces Model - How does the threat of new entrants analyse the competitiveness of a market?
- When firms enter an industry they will take a share of the market and increase competitive intensity.
- The greater the barriers to entry the smaller the threat will be (Monopoly markets)
Porters 5 Forces Model - How does analysing the bargaining power of suppliers show the competitivenes of a market?
- Suppliers who have a lot of power can force up the price of other businesses products this cuts profits available for these businesses.
Porters 5 Forces Model - How does analysing the threat of substitutes show the competitiveness of a market?
- Businesses that fail to keepe up with the latest technology will not have unique products to sell.
Porters 5 Forces Model - How does analysing the degree of competitive intensity show how competitive a market is?
- Where there is high competitive intenisty the result will be innovation, price wars and higher spending on promotion which all lower the amount of profits that can be achieved.
When is Porters 5 Forces Model used?
When a business is analysing wether it should enter a market.
What are some disadvantages with Porters 5 Forces Model?
Not always easy to obtain the required information about the market.
