Strategic Management Essay

2704 WordsApr 3, 201111 Pages
INTRODUCTION Stakeholder management has become increasingly important to business viability in today’s competitive landscape where organizations operate as open systems interacting with various stakeholders (Freeman, 1984). Stakeholders have influence over an organization’s strategies and decisions. I am going to use some examples to demonstrate that how organizations change their strategies to meet and satisfy their stakeholders’ expectation and interests. STAKEHOLERS DEFINITION Stakeholders are those individuals or groups who depend on an organization to fulfill their own goals and on who, in turn, the organization depends. (Johnson et al., 2008) In the other words, any constituency in the environment that is affected by an organization’s decisions and policies and that can influence the organization. (Johnson et al., 2008) Influence is likely to occur only because individuals share expectations with others by being a part of a stakeholder group. There are different types of stakeholders which are Shareholders, Financial community, Activist groups, Customers, Customer advocate groups, Unions, Employees, Trade associations, Competitors, Suppliers, Government and Political groups. Below is the diagram shows the close relationship between an organization and its various stakeholders. External Stakeholders Customers Suppliers Financial Community Governments Unions Competitors Political groups Customer advocate groups | Internal Stakeholders Executive officers Board of directors ShareholdersEmployees | Organization | The influence of these different types of stakeholders is likely to vary in different situations. For examples, Flight attendants of Cathay Pacific (CX) decided to go on a strike during Easter of 2010. ( Tam, J 2010) This action would have disrupted the travel plans of hundreds of Easter holidaymakers returning to work

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