Unit 1 - Exploring Management - Chapter 2 Flashcards
What did Smith say in shareholder theory?
a manager’s primary duty is to maximise shareholder returns
What did Smith say in stakeholder theory?
A manager’s duty is to balance the shareholders’ financial interest against the interests of other stakeholders such as employees, customers and the local community, even if it reduces shareholder return
How did Sternberg critique stakeholder theory - as cited in Phillips et al?
“effectively destroys business accountability … because a busines that is accountable to all is actually accountable to none”
Sketch Freeman’s Stakeholder view of the firm.
Sketch a stakeholder map of concentric circles
What are weaknesses of the concentric map stakeholders model?
Stakeholders may belong to more than one group: internal, external, primary or secondary.
Stakeholder groups tend to be made up of large groups of individuals which may not be homogeneous and may be groups within groups. Power often unequally shared.
Sketch a stakeholder relationship map
Describe 9 C’s stakeholder checklist
Commissioners Those who pay the organisation to do things
Customers Those who acquire and use the organisation’s products
Collaborators Those with whom the organisation works to develop and deliver products
Contributors Those from whom the organisation acquires content for products
Channels Those who provide the organisation with a route to a market or customer
Commentators Those whose opinions of the organisation are heard by customers and others
Consumers Those who are served by the organisation’scustomers, e.g. end users
Champions Those who believe in and will actively promote the project
Competitors Those working in the same area who offer similar or alternative services
Name one big weakness of all the stakeholder map models
The assume that stakeholders positions are fixed whereas in reality they are dynamic and change according to the issue at hand, level of interest and level of influence.
What did Bryson say was the main purpose of stakeholder analysis?
Identify stakeholders and their interest
Clarify stakeholder views of the organisation
Identify key strategic issues
Begin the process of identifying colaitions of support and opposition
Sketch Johnson et al’s power interest grid.
Which quadrant of his power interest grid did Johnson say was the most difficult to plan for - and why?
Quadrant C - the ‘keep satisfied’ group who have low interest but high power. They may appear passive but the level of interest can change suddenly, moving them to quadrant D - key players.
Why should stakeholders in quadrant B - keep informed - of Johnson’s power interest grid be careful management?
They may be vital allies in a broader lobbying strategy to influence more powerful stakeholders.
Sketch Price’s power versus interest grid.
How did Price describe low interest/low power stakeholders?
outsiders
How did Price describe high interest/low power stakeholders?
onlookers - interested in the changes taking place but have very little power or influence.
How did Price describe high interest/high power stakeholders?
Intruders - have the power to support or undermine change and are sufficiently interested to take action if they wish.
How did Price describe low interest/high power stakeholders?
Monitors - individuals or groups that have the power to support or influence your change effort, but not necessarily the interest to do so.
What is a key weakness of the power interest grids?
As with the maps, they assume that groups are static whereas in real life they are dynamic and may be in different positions according to the issue at hand.
What does Scholes caution against in stakeholder analysis?
Ascribing stakeholders more power than they actually posess
Being too simplistic or generic in selection of stakeholders to plot
Being too detailed in selection of stakeholders to plot, leading to analysis being too complex and diffiicult to analyse.
Sketch out an exampe of the stakeholder disposition model
What are Johnson’s sources and indicators of power for internal stakeholders?
Status (e.g. position in the organisational hierarchy)
Representation (e.g. committees they may be on)
Involvement in strateigc decision making
Reputation
Informal Influence
Expertise
Grade or Salary
Claim on resources (e.g. size of budget or number of staff)
Symobl of power (e.g. size and location of office or secretarial support)
What are Johnson’s sources and indicators of power for external stakeholders?
Control of strategic resources
Relative size of shareholdings or loans
Dependence on small number of customers
Reliance on small number of customers
Negotiating arrangements
Status (e.g. is the customer or supplied wined and dined)
At what level is the customer or supplier ‘managed’ by the organisation?
What are primary stakeholders?
Those stakeholders most vital to an organisation - without whom the organisation cannot survive.
What are secondary stakeholders?
Those on whom the organisation does not rely on directly for its existence.
What are the first two steps of stakeholder analysis?
1 - identify the stakeholders to be mapped
2- consider which strategies might be appropriate ina range of given circumstances.
Sketch Schole’s nine stakeholders maps
Describe “the political battleground” stakeholder map from Schole’s 9 stakeholder maps models.
many key stakeholders divided in support and resistance to the issue. Potential strategies include facilitating the dominance of supporters, breaking down resistance or “divide and rule”.
Describe “the lone champion” stakeholder map from Schole’s 9 stakeholder maps models.
One powerful supporter. Big threat is the loss of the champion. Strategies include extending the support base.
Describe “the worthy cause” stakeholder map from Schole’s 9 stakeholder maps models.
high level of interest from stakeholders with little power. Strategies include empowering the stakeholders and facilitating the creation of alliances.
Describe “The dream ticket” stakeholder map from Schole’s 9 stakeholder maps models.
Several powerful champions and no powerful opponents. Danger is complacency so strategy is to keep stakeholders satisfied.
Describe “The dogged opponent” stakeholder map from Schole’s 9 stakeholder maps models.
One powerful opponent. Strategies include breaking down their resistance or enlisting the support of a more powerful champion.
Describe “The political time bomb” stakeholder map from Schole’s 9 stakeholder maps models.
Several opponents with low power. Danger is underestimating their ability to gain support or build their own power base. Strategy is to keep them informed.
Describe “the potential lost cause” stakeholder map from Schole’s 9 stakeholder maps models.
Lots of powerful opponents. May have to abandon proposal. Main strategy is to break down resistance e.g. by building a coalition of support.
Describe “the political trap” stakeholder map from Schole’s 9 stakeholder maps models.
Low levels of interest among all powerful stakeholders. Strategies include raising levels of interest, keeping them satisfied or encouraging emergence of a lone champion.
Describe “the autocrats dream” stakeholder map from Schole’s 9 stakeholder maps models.
stakeholders have little interest and little power. Guard against complacency by monitering stakeholder reactions.
Sketch Stacey’s model of political activity and conflict
What did Stacey mean by “divergent objectives” in his model of political activity and conflict?
Individuals and departments can have different agendas and want different things from each other.
Depts are rewarded for achieving different things.
Leads to conflict.
Competition promoted rather an co-operation - differennt depts and people cannot all achieve their aims as they can be contradictory or opposing.
What did Clegg et al claim about power?
“power is to organisations as oxygen is to breathing”
“it concerns the ways that social relations shape capabilities, deisions, change”
What were the key points from the discussion on Toyata in terms of power/politics/conflict, just after the description of Stacey’s model of political activity and conflict?
- Different departments had different, conflicting aims.
- Marketing/Ops rewarded for speed and quantity of sales
- Quality dept rewarded based on few cars leaving factory with faults.
- Objectives diverge
- Marketing want quick sales
- Quality depts less focused on quantity, more on quality
- Problems when they obstruct each other - quality dept refuse to sign off on poor quality cars, marketing trying to push cars out the door.
- Political activity….
- Marketing attempted to get Quality to turn a blind eye.
- Quality dept could get pedantic
- Objectives now diverge more.
- Toyota - 2009-2011 big recalls
- push ot be top autmobile company had warped management decisions
- cars were not being produced in the “Toyota Way”
- 20 million cars recalled
- increased passenger and driver deaths
- drop in public trust
- $1.1b settlement to US Dept. of Justice.
What were the characteristics of power described as?
- It is relational
- it’s not something one has in an absolute sense
- one’s power to influence another depends on the relationship between them
- It derives from difference
- Some groups are marginalised
- It involves beliefs and perceptions
- our power is shaped by our beliefs and those of the people around us
- depends on resources, sanctions etc. controlled
- we often make ourselves feel intimidated by attributing excessive power to others.
- It is never one sided
- Master is nothing without the slave
- managers have managers too
- It is contextual
- depends on context of relationship
- dynamic
- once out the building, the CEO has no more power than the cleaner
What are French & Ravens sources of power?
- Legitimate Power
- Reward Power
- Coercive Power
- Expert Power
- Referent Power
What did French and Raven mean by Legitimate Power?
Maps to Max Weber’s rational-legal power.
Based on agreed power based on agreeing that those ocupying a specific role can expect and request certain behaviours from others.
Depends on sustained only as long as people agree to respect agreement.
What did French and Raven mean by Reward Power?
Derived from the person’s ability to control allocation of rewards - and remove sanctions.
eg. pay, promotions, time off and work assignments.
Employees have this through 360 feedback processes.
What did French and Raven mean by Coercive Power?
Ability to achieve an outcome through applying punishment.
Reprimanding, disciplining, demoting, firing.
Unions can also have this power - strikes, working to rule etc.
Team members have it through sarcasm, ostracism etc. to ensure co-workers confirm to team norms.
What did French and Raven mean by Expert Power?
Based on the particular knowledge/skills of the individual.
In theory, the greater and rarer these skills are, the greater power the holder has.
Staff have this more and more in the knowledge economy.
What did French and Raven mean by Referent Power?
People have referent power when other people identify with them, like them or respect them.
Associated with the person rather than the role.
Function of person’s interpersonal skills.
dynamic and precarious, can be destroyed quickly.
What are Morgan’s resource-based views of power?
- Position or formal authority
- Control of scares resources
- Use of organisational structure, rules and regulations
- Social connections
- Expterise
- Control of knowledge and information
- Control of counter-organisations
- Interpersonal alliances, networks and control of “informational organisations”
- Personal power/power one already has
All inter-related.
Power/influence are not simply top-down, often more fluid.
What is “Position or formal authority” in Morgan’s resource-based views of power?
position that a person holds entitles them to do cetain things.
backed by rules of organisation
most orgs limit this power to certain tasks. eg. doctor can tell a nurse to take a patiant’s temperature but not to clean their car.
What is “control of scarce resources” in Morgan’s resource-based views of power?
orgs depend on adequarre supply of resources for continued existence.
Control over these can be source of power.
keys are dependence and scarcity
What is “Use of org structure, rules and regulations” in Morgan’s resource-based views of power?
jobsworths - useing rules of org to obstruct others or to obscure their own lack of knowledge.
use of buereaucratic red tape.
However:
structure of org should be set out to promote fairness by treating all cases the same, so rules can support this.
A way of passing the buck - the rules “say so”.
What is “Social Connections” in Morgan’s resource-based views of power?
“It’s not what you know, it’s who you know”
What is “Expertise” in Morgan’s resource-based views of power?
Use of expert knowledge to influence others.
In a meritocracy, expertise is one of the most readily acceptable bases of power.
What is legitimate power can be contentious
People guard knowledge jealously, to enhance their own indispensibility and undermine others.
two important sources:
technical knowledge.
process knowledge.
What is “Control of knowledge and information” in Morgan’s resource-based views of power?
Control of information is increasingly a source of power.
eg a gatekeeper could be a secretary controlling access to speak to their boss.
What is “Control of counter-organisations” in Morgan’s resource-based views of power?
Where an employee can draw on expert, legitimate or other sources of power from counter orgs. e.g. ones whose aims are different or in opposition to the org.
e.g. a trade union using the press to strengthen its own position.
What is “Interpersonal alliances, networks and control of ‘informal organisations’” in Morgan’s resource-based views of power?
Friends in high places, sponsors, mentors, people willing to trade support for favours etc
Patroage, ability to ride on the coat-trails etc.
Informal networks such as lunching together, meeting in the smoking corner or gym.
What is “Personal power/the power one already has” in Morgan’s resource-based views of power?
personal qualities and characteristics.
Referent power in French and Raven.
Limitation: can give too much credence to the individual rather than the system.
What is Luke’s first dimension of power?
power is seen as overt.
consists of winning or prevailing over others.
organisation is seen as one dimension or unitarist where:
common goals are persued
authority of mgt is automatic
legitimacy is upheld through rules, procedures and hierarchy.
power is observable: hammer and nail analogy.
Essentially about exercising power in the ways indicated by French and Raven.
What is Luke’s second dimension of power?
More covet than first dimension.
Pluralistic - recognising that different agendas are pursued.
structure of the org leads to conflict though differing priorities.
person B has less power than person A and so makes fewer demands on them. Fear of confrontation or reprisals.
Not as well defined as first dimension.
more concerned with deciding debates does/doesn’t get on the decision making agenda.
About controlling the org agenda to present as normal and not subject to negotiation.
What is Luke’s third dimension of power?
Views organisations as systems of domination.
Organisational discourses limited to the elite who control them.
Common phrases:
“work hard, play hard”
“you’re either part of the solution or part of the problem”
Assumes all members of an org have to be part of a given solution
They may not agree with the solution
Discourse is phrased so a person can only fit one of two contrasting choices, and only one is “safe”
In Luke’s view - the most insidious form of power, compliance maintained by norms that are taken for granted.
Focuses on language and defing basic discourses.
Usually entails etablishing strong links between an orgs values and identities and dominant values and ideologies of wider society.
What was Cynthia Hardy’s criticism of Luke’s three dimensions of power model?
It still illustrates power is contructed as property of the individual - something one has.
How did Hardy extend Luke’s three dimensions of power model?
She added a fourth dimension:
The relational view.
- Power can never be absolute
- It is rooted in taken for granted dynamic systems.
- Always in relation to others.
- Chess board analogy:
- Pawns are weakest
- But under certain circumstances - ie the begining of the game - they have all the power as no other pieces can move until they do.
- Each piece will exercise different forms of power according to how it can move
Hardy says that power circulates through the entire system and isn’t simply the property of an individual person.
