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Do you know the secret of how stakeholders affect the long-term value of a company?
In today's rapidly changing business environment, stakeholder management has become one of the key elements for corporate success. Stakeholders are those who can influence a project, program or activity, whether they are directly involved or indirectly affected. In some scholars' definitions, such stakeholders can be customers, employees, suppliers, or even community members.
"The participation of stakeholders determines the direction and future of the company."
The process of stakeholder management is usually viewed as a continuous four-step process, which includes identifying stakeholders, determining their influence, developing a communication management plan, and influencing these stakeholders through participation. In this process, it is particularly important to understand the needs and expectations of customers, because customers can be said to be the core stakeholders of the enterprise.
The long-term value management of an enterprise often depends on attaching great importance to customer satisfaction. As market competition intensifies, companies need to constantly adjust their strategies to meet customer needs so that they can achieve growth and profitability in the long term.
Historical background of stakeholders
The concept of stakeholders dates back to the 1930s. In 1963, the Stanford Research Institute first defined the concept of "stakeholders." In 1984, Edward Freeman elaborated on this theory in his book "Strategic Management: The Stakeholder Approach" and established a knowledge system about ethical stakeholder management.
“When business managers deal with different stakeholders, they often face conflicts between personal roles and legal and moral responsibilities.”
As time goes by, the performance methods of stakeholder management have become increasingly mature. Between 1993 and 1998, seven important principles related to stakeholder management were proposed at various meetings. These principles emphasize the ethical responsibilities of managers in practice. At the same time, criticisms of stakeholder management have also emerged. For example, Jon Argenti stated in 1996 that this concept has "completely lost its credibility."
Stakeholders in the organization
Obviously, every organization has a variety of stakeholders, including but not limited to customers, shareholders, employees, and suppliers. Faced with such a diverse group of people, managers need to pay special attention to the needs and expectations of all parties in order to maintain good business relationships.
Dividing the priorities of stakeholders
When managing stakeholders, an important step is to prioritize them, which can be done using a power-interest diagram. This approach can help companies more effectively identify which stakeholders require a higher level of input and satisfaction.
"High power, high interest people: must be fully engaged and have their expectations met."
After this classification method is established, enterprises can formulate corresponding strategies to deal with the needs of stakeholders at different levels. This not only improves the chances of project success, but also helps the company build goodwill within the industry.
The significance of stakeholder participation
Effective stakeholder management promotes good relationships with all parties, and companies should manage these relationships strategically. The main goal of stakeholder participation is for both parties to have transparent communication and management of expectations, thereby achieving common goals.
According to the survey, many enterprises have begun to use professional stakeholder management software to further analyze and manage their networks. These tools help companies track interactions with stakeholders to ensure compliance and improve communications.
"Manage risks: Stakeholders can be viewed as both risks and opportunities."
Future Outlook
With the advancement of globalization and the development of technology, effective stakeholder management has become increasingly important for enterprises. Managers must understand and take responsibility for improving interactions with various stakeholders. This will not only enhance the company's ability to resist risks, but will also help achieve the goal of sustainable development.
While pursuing corporate growth, the ability to properly take into account the needs of various stakeholders will become a key factor in the success of future corporate operations. So, is your business ready to face the challenges of stakeholder management?
