Stakeholder Analysis

In the business lineup their are many stakeholder that are attached with an organization.
Some of stakeholder can effect the organization very badly and they turn the dynamic
organization into the static organization. All organization whether they are corporate or
public they have their on stakeholder depends upon their area of operation and
demographic conditions. For a successful organization it is necessary to analyses the area
of the stakeholder that are effected or effected by the organization policies.

Stakeholders:
A stakeholder is any individual or group who can affect of is affected by the
action decisions, policies, Practices, or goals of the organization.

Stakeholder Analysis:
It is a framework that enables users to map and manage corporate
relationships with groups who affect and are affected by the corporation’s policies and
actions.

1) Mapping Stakeholder relationships:

In this step organization identify their stakeholders on
the basis of the following questions which are as follows:

 Who are the current stakeholders?

As an the corporate organization customers are the major
stakeholders. who can affect and are affected by the corporation’s policies and actions.

 Who are Potential Stakeholders?

The potential stakeholder would also be the same as current stakeholders.
There wouldn’t be any additional group in the future.

 How does each stakeholder affect Gourmet?

Stakeholders can affect us with their boycotting power. As was with the
example of gourmet cola. When the price of gourmet cola was increase the
stakeholders (the customers) shifted to coke and as a result we had to reduce our
price back to its original price.

 How do we affect each stakeholder?

We can immediately affect our customers with our decisions. E.g. if we
want more customers we can lower the prices of particular items slightly.

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Stakeholder map:

Gourmet (Firm)

2) Mapping stakeholder coalitions:

Different coalitions have been formed among some of our customers and they
managed to help us open up a new branch. These coalitions can also work against us.

3) Assessing the nature of each stakeholder’s interest:

In this step I will assess the nature of our customers interest. Following are the
interest of customers
• Low prices:
This is a standard interest. Almost all customers want low prices.

•
Good Quality:
All customers want good quality items/products. So, they basically want low
prices with good quality.

• Fresh products:
Customers also want fresh products. E.g. fresh pizza or bread etc.

4) Assessing the nature of each stakeholder’s powers:

In this step I will assess the customer’s powers

Economic power:
Customers have economic power i.e. they can boycott any product. For
example when the price of gourmet cola was increased the customers with their
Economic power boycotted gourmet cola and shifted to coke.

5) Constructing a Matrix of stakeholder Moral responsibilities:

In this step I will construct a Carroll’s Matrix:

Carroll’s Matrix
Stakeholder

Nature of focal company responsibilities

Legal Economic Ethical Voluntary

Customers    
Explanation of Carroll’s matrix:

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 • Legal:
Gourmet has legal responsibilities on its customer. E.g. It’s their legal
responsibility to sell unexpired products.

• Economic:
Gourmet also has economic responsibility. E.g. If they increase their prices
customer’s will shift to their competitors.

• Ethical:
There is also Ethical responsibility between the customer and Gourmet

• Voluntary:
Voluntary responsibility is also present between the customers and Gourmet.

6) Developing Specific Strategies and Tactics and Formation of Typology:

In this I will develop specific strategies based on the preceding steps.
Following are some of the strategies

We can approach the customers either directly or indirectly but mostly gourmet uses the
direct approach

Based on the previous steps the best strategy would be to do nothing with certain
stakeholders with respect to offensive or defensive

Finally, regarding whether to accommodate, negotiate, resist or wait and see with specific
shareholder I think Gourmet should accommodate its customers.

Typology:
Following is the typology which has two dimensions
i) Potential for threat
ii) Potential for cooperation

Stakeholder’s potential for threat to Organization

High Low
Stakeholder

High
’s

Low  

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cooperation with
Potential for

organization

Explanation of Typology:

• Low&Low:
E.g. Gourmet is dumping its waste near a residential area. Now from normal
people there is low threat to the organization. Likewise, the cooperation level
between the normal resident’s and gourmet is low

• High&Low:
Now if an IG or some high personality is living in that residential complex
now the threat to Gourmet is high. But the cooperation level is still low.

7) Monitoring shifting coalitions:

Finally, the last step is to monitor the changes in stakes and stakeholders by time
and events.
Following is the table of changes in no. of customers from 2006 to 2008. The
reasons are also given.

Year No. of Customers Reasons

2006 Decreased by 40% Increase in prices of

some products

2007 Came back to normal Prices lowered back

i.e. increased by 40% to original prices

2008 No change in no. of customers No changes to price and

quality