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(G1) [ABS] (week4) Stakeholder Strategy (Team Members (Jamie, Andri, Miki,…
(G1) [ABS] (week4) Stakeholder Strategy
1.Introduction to Stakeholder Strategy
Valuable competitive position
Values/opportunities/capabilities
purpose and mission
eg:Whole Foods Market
Create value of variety of parties
eg customers/employees
6.Value Creation and Your Values
Strategy and ethics
Important to think beyond
Not just about profits
Institutional/non-market strategies can seem overly instrumental
Creating values for stakeholders
3.Aligning Key Stakeholders
Analyze
What the stakeholders want?
Stakeholder issues matrix
The impact on each shareholder groups
Stakeholder impact matrix
Many different values
Get agreement on the same value
4.Aligning Secondary Stakeholders
uber
government
legislation or regulators
trade policies and tariffs
environmental policy,
fees and permits and standards
safe?trained?
non-governmental organization
institutional pressure
environmental issues
regulatory activism
competitors
unions fighting for their benefit
media
surrounding any sort of negative press coverage
highlighting
products
corporate misconduct
social or religious issue
environmental issue
5.Sources of Institutional Pressure
Political Actors and Stakeholders
Distributional Conflict
Negative Externalities
Definition
Costs imposed on one stakeholder
Issues
Firms lack market incentives to reduce costs
Examples
Noise, Air and Water Pollution
Solution
Regulations (Taxes and fees), Lawsuits, Property Rights, Stakeholders force internalization
Common Goods
Definition
Resources to which everyone has free access, and more for one consumer , less for others
Issues
Tragedy of the commons: Firms, individuals
Examples
Fisheries, oil fields, water tables, spectrum
Solution
Grant monopoly over resource, government regulation, self-regulation
Market Power
Issues
Firms may capture consumer surplus at the expense of general welfare
Examples
Collusion, Cartels, Predatory pricing
Definition
Ability to price above competitive levels
Solution
Regulation, M&A approval, antitrust lawsuits
Information Asymneties
Issues
Increase transaction costs
Examples
Used cars, organic foods, share value, labor practices
Definition
Create a "market for lemons" or principal-agent problems
Solution
Reporting, standards and labels (both public and private)
Institutional (Non-market) Strategies
Try case in the court of public opinion
Public relations , both information dissemination and rhetorical strategies
Negotiate with stakeholders
Pursue recourse through the courts
Patent infringement , contract disputes
Address stakeholders' concerns or " self-regulate"
Proactive environmental actions, business model adaptation
Lobby government
Trade Associations
Normative Conflict
Solution
Public education campaigns, enfranchisement, business model adaptation
Examples
Child labor, Privatization or Unionization
Issues
Firm actions and government policies
Definition
Norms are society's accepted, established beliefs about how things should be done
2.Creating Value for Stakeholders
Know who do we create that value for?
Leader need to figure out how to create the value
meet the different stakeholders need
Employee
good salary, job security
Investor
Financial return
Customer
Price , service
Supplier
continuity, reliability
Align those stakeholders
Team Members
Jamie
Andri
Miki
Joanna
May
Cindy