Stakeholders stakeholder expectations and organisational purposes

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Stakeholders stakeholder expectations and
organisational purposes
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Objectives

• Students are to be able to evaluate the power and
  levels of a variety of pertinent stakeholders of
  organisations.
• Students are to be able to evaluate the interest
  levels of a variety of pertinent stakeholders of
  organisations.
• Students are to be able to use their evaluation
  of the power and interest levels of a variety of
  pertinent stakeholders of organisations, to show
  how strategies can impact upon and be impacted
  upon by a variety of stakeholder groups.
• Students are able to show how management styles
  play a role in stakeholdering.

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Expectations and purposes
Resources, competences and capability
The environment
Strategic analysis
Bases of strategic choice
Organisation structure and design
Strategic choice
Strategy implementation
Resource allocation and control
Strategic options
Strategy evaluation and selection
Managing strategic change
Exhibit 1.4 A summary model of the elements of
strategic management
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• Corporate governance
• Whom should the organisation serve?
• How should purposes be determined?

• Business ethics
• Which purposes should be prioritised?
• Why?

• Organisational purposes
• Mission
• Objectives

• Cultural context
• Which purposes are prioritised?
• Why?

• Stakeholders
• Whom does the organisation serve?

Exhibit 5.1 Influences on organisational purposes
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STAKEHOLDERS

• Those who depend on the organisation for the
  realisation of some of their goals and in turn
  the organisation depends on them for the full
  realisation of its goals
• Customers
• Competitors
• Government
• Suppliers
• The community
• Employees
• Lenders

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CORPORATE GOVERNANCE AND STAKEHOLDERS

• Shareholders
• widespread or close?
• institutional intermediaries?
• bankers?
• cross-shareholding?
• Employees
• Co-determination, shareholders or employees?
• Lenders
• partners or contractors?
• Customers
• Caveat Emptor, market pressure or regulation?

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• (a) Within organisations
• Hierarchy (formal power),
• e.g. autocratic decision making
• Influence (informal power),
• e.g. charismatic leadership
• Control of strategic resources,
• e.g. strategic products
• Possession of knowledge and skills,
• e.g. computer specialists
• Control of the environment,
• e.g. negotiating skills
• Involvement in strategy implementation,
• e.g. by exercising discretion

• (b) For external stakeholders
• Control of strategic resources
• e.g. materials, labour, money
• Involvement in strategy
• implementation,
• e.g. distribution outlets, agents
• Possession of knowledge (skills),
• e.g. subcontractors
• Through internal links,
• e.g. informal influence

Exhibit 5.6a Sources of power
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• (a) Within organisations
• Status
• Claim on resources
• Representation
• Symbols

• (b) For external stakeholders
• Status
• Resource dependence
• Negotiating arrangements
• Symbols

Exhibit 5.6b Indicators of power
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• Growth vs profitability
• Short term vs investment
• Control vs professional managers
• Ownership vs funding
• Ownership vs accountability
• Efficiency vs jobs
• Mass appeal vs quality

Exhibit 5.3 Some common conflicts of expectations
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LEVEL OF INTEREST
POWER
Exhibit 5.5 Stakeholder mapping the
power/interest matrix
Source Adapted from A. Mendelow, Proceedings of
the Second International Conference on
Information Systems, Cambridge, MA, 1991
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STAKEHOLDER MAPPING- SOME GUIDELINES

• Positioning related to specific strategies
• Stakeholders may need to be sub-divided
• Distinguish the role for the individual
• Identify political priorities by
• plot how stakeholders would line up
• plot how stakeholders would need to line up
• identify mismatches
• include key maintenance activities

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STAKEHOLDER MAPPING- test questions

• Power
• If I were to pursue this strategy with disregard
  to the
• views of this stakeholder could they stop me?
• Interest
• How high is this strategy in their priorities -
  are they
• likely to actively support or oppose this
  strategy?

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STAKEHOLDER MAPPING

• - typical maps

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Management Styles

• We need to consider how management styles differ
  when dealing with each stakeholder group

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Level of interest
Power
Stakeholders and management styles
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STYLE MEANS/CONTEXT BENEFITS PROBLEMS CIRCUMSTANC
ES OF EFFECTIVENESS Education and Group
briefings assume Overcoming lack of Time
consuming communication internalisation of
strategic (or mis)information Direction or
progress logic and trust of top may be
unclear management Collaboration/ Involvement
in setting the Increasing ownership Time
consuming participation strategy agenda
and/or of a decision or Solutions/outcome
resolving strategic issues process May improve
within existing by taskforces or groups
quality of decisions paradigm Intervention
Change agent retains Process is Risk of
perceived Incremental or non-crisis
co-ordination/control guided/controlled
manipulation transformational change delegates
elements of but involvement change takes place
Direction Use of authority to set Clarity and
speed Risk of lack of Transformational change
direction and means of acceptance and ill-
change conceived strategy Coercion/edict
Explicit use of power May be successful in
Least successful Crisis, rapid through edict
crises or state of unless crisis
transformational change confusion or change
in established autocratic cultures
Incremental change or long-time horizontal
transformational change
Exhibit 11.6 Styles of managing strategic change
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Activity

• Read Johnson Scholes (1999) section 5.3.2 of
  the text and illustration 5.4 for practical
  advice on how to undertake a stakeholder mapping.
• AND
• Carry out a stakeholder mapping exercise for the
  Granada buy out of Forte Hotels. Support this
  with researched evidence (newspaper articles,
  journal articles, web searches etc.) Bring it to
  the seminar for discussion.
• OR
• Read the Sheffield Theatres Trust case study on
  page 670-84, Johnson Scholes, 1999, Exploring
  Corporate Strategy 5th Ed. And carry out a
  stakeholder mapping exercise.
• OR
• Carry out a stakeholder mapping exercise for an
  hospitality/tourism organisation and
  strategy/scenario of your choice. Support this
  with researched evidence (newspaper articles,
  journal articles, web searches etc.) Bring it to
  the seminar for discussion.

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MORETON UNIVERSITY

• A case study

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COMPUTER SERVICES - monopolist strategy Map A -
current situation (1998)
LEVEL OF INTEREST
Low
High
A Students
B Director A () Competitor X (-) Principal F (-)
Low
POWER
D Director C (-) Vice Chancellor (0) Chairman (-)
C Funding Body Director E Director S
High
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COMPUTER SERVICES - monopolist strategy Map B -
the preferred situation
LEVEL OF INTEREST
Low
High
A Students
B Competitor X (-) Principal F (0)
Low
POWER
D Director A () Director S () Director C
(-) Vice Chancellor ()
C Funding Body Director E Chairman
High
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MORETON UNIVERSITY- political priorities
(monopolist strategy)

• Dilute power of Director C
• Lobby Directors E and S to increase interest
• Director A now on Governing Body
• Inform Chairman of difficulties elsewhere
• Improve service to colleges - silence Principal
  F

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MORETON UNIVERSITY

• - assessment of power

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The Political Battleground
- - -
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The Dream Ticket

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The Potential Lost Cause
- - - - - -
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The Lone Champion

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The Dogged Opponent
__
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The Political Trap
? ? ? ? ? ?
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The Worthy Cause



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The Political Timebomb

- - - - - -

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The Autocrats Dream


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