Stakeholders in business organisations Flashcards
Who are stakeholders?
Those individuals or groups that , potentially have an interest in what the organization does.
managers act as ____ for the stakeholders.
agents
Explain the agency relationship
this is the separation between the organizations owners ( the shareholders) as the “ principal “ and those managing the business on their behalf ( company directors) as their “ agents”.
name the 3 types of stakeholders
- internal
- connected
- external
who are internal stakeholders?
- these stakeholders are present within the organization.
who are external stakeholder?
-neither involved in running the organization nor do they have a financial link with the organization.
who are connected stakeholders?
- these stakeholders are not working for the organization but they have a financial link with the organization.
who are primary stakeholders?
they have a contractual relationship with the organization.
who are secondary stakeholders?
they do not have a contractual relationship with the organization.
each stakeholder group considers itself a ____ of the organization.
client
Describe Mendelows framework
- used by directors to identify the most important stakeholders and draft an appropriate strategy to address their needs. Makes use of shareholder mapping which is POWER against INTEREST.
Describe HIGH POWER , LOW INTEREST in shareholder mapping
- they should be kept satisfied.
- they dont take interest in the day to day activities of the organization
- example is the government.
Describe HIGH POWER , HIGH INTEREST in shareholder mapping.
- they are key players.
- all decisions must be accepted by them.
- example is customers.
Describe LOW POWER, HIGH INTEREST in shareholder mapping.
- they should be kept informed
- their views are important as they influence people
- example is charities
Describe LOW POWER , LOW INTEREST in shareholder mapping.
- minimum effort required
- they dont have power over decisions
- example is a migrant worker
