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Stake holders, STEEPLE - Coggle Diagram
Stake
holders
Interests of internal stakeholders
Managers
are the individuals who run the organisation. They are responsible both for setting aims and objectives and making sure they are met.
Shareholders
are the owners of the company. Shareholders invest in a business in order to receive a return on their investment. They are therefore primarily concerned with the company’s profitability.
Employees
include individuals who work for the company but who are not responsible for managing other employees. Like managers, employees are motivated by compensation, benefits, job security, and working conditions.
Interests of external stakeholders
Customers
include both individuals and other businesses that purchase the output of the organisation. They demand good service and quality products that are also safe and are sold at a reasonable cost.
Suppliers
are the individuals and businesses that sell goods and services to another organisation. They want to be paid fair and reasonable prices for these inputs. They also wish to maintain a stable business relationship with the companies they supply in order to ensure a reliable market for their goods
Governments
regulate organisations in order to protect the public interest; governments also enforce laws and reprimand companies when necessary.
Unions
exist to protect employees’ livelihoods and rights, and as such are important stakeholders for many organisations. Unions usually represent employees in many different firms;
Banks
lend organisations funds so they can invest and carry out their operations. Banks want to be sure that these loans are paid back, with interest, on schedule. They will therefore closely monitor the organisation's liquidity and solvency using financial accounts
Society
as a whole, as well as the environment, is affected by corporate behaviour, as we learned in the unit on corporate social responsibility. When society’s interests are not adequately defended by government, pressure groups may step in to make sure corporate behaviour does not adversely impact the planet and its residents.
Competitors
unlike the previous stakeholders, a company’s competitors do not have an interest in its success. However, they are greatly impacted by its practices. At a minimum, companies expect their competitors to engage in fair competition by adhering to laws and ethical business practices.
Areas of mutual benefit and conflict between stakeholders
Managers and emploees
Management may wish to maximise productivity, while employees may prefer to work less or under less stressful conditions. Potential remedy: employee participation in management and performance-related pay
Shareholders and managers
Managers may sometimes look after their own interests rather than those of the firm. They may engage in activities that improve their personal reputation or remuneration without improving profits
Shareholders and the government
Government expects businesses to pay fair taxes, according to the law of the country, but shareholders may pressure management to reduce the company’s tax burden through sophisticated accounting and legal schemes
Managers and unions
Managers may oppose unions’ intervention in the relationship between managers and employees at a particular firm. This is because unions can assist employees in obtaining better wages and benefits from management than employees might otherwise negotiate on their own.
Customers and suppliers
Customers demand high quality and low prices, which is in conflict with suppliers’ interest in being paid fairly. This conflict is played out between agricultural producers and consumers, with supermarkets in the middle coming under pressure from both stakeholders .
Pressure groups and employees
Pressure groups may oppose certain projects that have the potential to harm the environment. These same projects may benefit the local community in terms of employment.
STEEPLE
STEEPLE is a framework that is useful in examining a firm’s external environment.
sociocultural and technological factors
Sociocultural factors relate to the way people live and what they believe and value. This factor therefore includes a wide variety of considerations.
Religion includes consideration of both the dominant and minority religions of the population, as well as the importance and influence of religion in daily life.
Cuisine is also included in sociocultural factors: what do people eat, at what time, and with whom?
Family life: Are families large or small? Is the nuclear family the essential family unit, or do extended families including several generations live together under one roof?
Demographics is included with sociocultural factors. What are the statistics in terms of fertility and life expectancy? What does the pyramid of age look like?
Technological factors
Closely linked to the growth of information technology is the increasing availability of big data that can be exploited by companies to understand and meet the needs of their clients.
Other key technologies include nanotechnology, with applications in fields as varied as textiles and electronics, and genetic engineering, which is leading to advances in medical and agricultural science. Technologies like 3D printing, artificial intelligence and robotics are just beginning to change the way we live and work.
In addition to these technologies that are driving change worldwide, a more traditional factor to take into consideration is the availability of infrastructure, particularly in developing countries. Infrastructure includes things like ports and road and rail networks, drinking water and sanitation facilities, and communication networks and reliable electricity, all of which are necessary to doing business.
economic and environmental factors
Economic factors
The demand for products and services is not the same in poor countries as it is in wealthier ones. As economies develop, consumers have more money to spend.
Even wealthy countries experience business cycles, where periods of rapid growth alternate with months or possibly years of slower growth or retrenchment. During these years, consumers’ income will decrease and unemployment may become a problem. There will be lower demand for consumer goods.
GDP
is calculated as the total monetary value of all final goods and services produced in an economy in a given period of time
GDP per capita
is calculated by dividing total GDP by the population of a country. GDP per capita is used to measure the relative wealth or poverty of a nation.
Recession refers to the case where GDP decreases for two or more quarters. A quarter refers to a three-month period; there are therefore four quarters in a calendar year.
Depression is used to describe a prolonged or particularly severe recession. There is no established criterion for defining depression in an economic context.
Inflation refers to an increase in prices, usually calculated as an annual rate of increase. The most used indices for inflation refer to consumer prices (Consumer Price Index –
CPI) in a given country; although other measures also exist (for example wholesale price indices measure prices paid by retailers to purchase goods in bulk).
Deflation refers to a decrease in prices. Deflation is less common than inflation, although it does occur when economies slump, or in certain industrial sectors, such as electronics, where advances in technology permit a reduction in costs.
The unemployment rate is calculated as the percentage of the labour force that is out of work but actively seeking employment at a given time.
Imports are goods brought into a country and exports are goods manufactured in a country and sold abroad.
Exchange rates refer to the cost of one country’s currency in terms of another country’s currency. For example, as of September 2016, one British pound could be purchased with about 9 Chinese yuan.
Environmental factors
The quantity and quality of available fresh water. The availability of fresh water is an increasing constraint on business activity in many parts of the world.
Climate change is already having an impact on businesses worldwide. Most experts agree that climate change has already altered weather patterns and increased the frequency of storms and floods, as well as forest fires and droughts.
political, legal and ethical factors
Political factors
At the most basic level, the issue is: what is the political regime in a particular country? Is it a constitutional monarchy, a parliamentary democracy, a presidential democracy, a one-party state or a military dictatorship? Is the political situation stable or is there civil unrest that could lead to regime change? Are elections coming up? Is the political landscape changing with the emergence of new political parties?
Legal factors
Business must at a minimum abide by all existing laws and regulations. These are generally made by central governments, but additional rules may be set by local authorities. Companies must obey the law not only in their home countries, but in all the countries where they operate.
In addition to laws, the potential for litigation is an issue in many industries. Companies can be sued by governments for anti-trust behaviour, by other companies for anti-competitive practices, by employees for unfair practices, and by consumers for producing harmful or potentially harmful products.
Ethical factors
Companies are increasingly under fire for marketing products that may not be in consumers’ best interests. Most people would agree that alcohol and tobacco marketing campaigns should not target children.
International organisations working in developing countries are criticised for treating local employees less well there than in their home countries.
Even in the west, movements opposing unfair labour practices must be considered. For example, 'zero hours' contracts are controversial because they may be abused by employers.
Companies’ pricing policies, such as discriminatory pricing and predatory pricing, may have ethical components. For example, should drug companies adapt their pricing policies to make their products affordable in poorer countries?