Stakeholder Mgmt Concept

Question 1

Definition of a stakeholder

Answer 1

Stakeholders in a corporation are the individuals and constituencies that contribute, either voluntarily or involuntarily, to its wealth creating capacity and activities, and that are therefore its potential beneficiaries and or its risk bearers

Question 2

Criteria for identifying stakeholders

Answer 2

• Supply resources that are critical to the success of the enterprise
• They place something of value “at risk”; their own welfare is directly ‘affected by the fate of the enterprise’
• They have ‘sufficient power’ to affect the performance of the enterprise, either favorably or unfavorable

Question 3

Definition of stakeholder mgmt

Answer 3

The term stakeholder management refers to management practices that reflect awareness of and response to the legitimate concerns of the multiple constituencies of the corporation. Note that the term does not refer, […] to the manipulation of stakeholders for narrow organizational purposes— that is, the management of stakeholders

Question 4

What is voluntary and involuntary association?

Answer 4

• Voluntary = mutual benefit
• Involuntary = subject to pollution, congestion, unwelcome cultural influences, or the like, the critical management goals have to be avoidance of harm, reduction of risk, and/or creation of offsetting benefits, so that the continued operation of the individual enterprise—its “license to operate”—remains acceptable to all parties

Question 5

What are the characteristics of the relationships between stakeholders and organizations?

Answer 5

Benefit flows
- Stakeholders contribute and receive benefits from org and vice versa
Simultaneous roles
- Stakeholder can occupy multiple roles (customer and supplier)
Multiple Linkages
- Stakeholders have overlapping and multiple connections with org
Issue variance
- Stakeholder relationship varies across issues and time

Question 6

Strategic vs Multifiduciary

Answer 6

Strategic
- Maximizing org benefits through manipulation of stakeholders
Multifiduciary (fiduciary = trust)
- Increasing benefits for org and key stakeholders

Question 7

Instrumental vs Normative

Answer 7

Instrumental
- stakeholder viewed as the sum of transactions and contracts

Normative
- stakeholder viewed with trust and cooperation

Question 8

What are some challenges in stakeholder management?

Answer 8

• Identifying stakeholders and balancing interests
• Shareholders as stakeholders
• Managers as stakeholders

Question 9

4 Principles of Stakeholder Theory

Answer 9

1. a focal org has a relationship with many stakeholders
2. interests of all stakeholders have intrinsic value, and no set of interests is assumed to dominate others
3. stakeholder theory concerns itself with the nature (process and outcome) of the relationship btw the focal org and its stakeholders
   focus on the theory is on managerial decision making

Question 10

What is the framework for stakeholder management?

Answer 10

i. Who are our stakeholders?
ii. What are their stakes?
iii. What opportunities and challenges do our stakeholders present to our firm?
iv. What responsibilities (economic, legal, ethical, philanthropic) does our firm have to all its stakeholders?
v. What strategies or actions should our firm take to best deal with stakeholder challenges and opportunities?

Question 11

Who are the stakeholders?

Answer 11

Primary stakeholders
- have formal, contractual, or official relationship
Secondary stakeholders
- all other stakeholders

Question 12

Issue management

Answer 12

A controversial inconsistency based on one or more exceptional gaps,

 - Involving management perceptions of changing legitimacy and other stakeholder perceptions of changing cost/benefit positions, 
 - occurring] within or between views of what is and/or what ought to be corporate performance or stakeholder perceptions of corporate performance, and
 - [implying] an actual or anticipated resolution that creates significant, identifiable present or future impact on the organization.

Question 13

R.A.C.I Matrix

Answer 13

Responsible Accountable Consulted Informed

- identify roles and tasks