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6.8 Stakeholder management

Within the network or relationships a manager establishes may also be stakeholders. Stakeholders can be defined as people that have a core or non-core interest in what is being managed. This may include an operational plan or the organisation's overall strategic interest.

Core stakeholders are essential to the survival of the organisation. These stakeholders usually must be satisfied if the outcomes are to be achieved in a manner that may be considered successful.

One of the most powerful stakeholders in any commercial business is the shareholders. The use of stakeholder analysis and planning tools are often promoted as essential because they can ensure any operation or project can be planned with full appreciation of the value created for shareholders.

Activity 3

  1. Examine the grid below from Manktelow, R (2003) Stakeholder Planning - Planning stakeholder communication , Mind Tools, 4 pages and resources. Sourced November 2004, at http://www.mindtools.com/pages/article/newPPM_08.htm .
  2. Plan a project or activity you are undertaking and map some stakeholders into this grid.
  3. Now devise strategies to manage and preserve the interests of the stakeholders.

The Clarkson Principles for Stakeholder management

Note:
The Clarkson Principles for Stakeholder management ( http://www.cauxrou
ndtable.org/TheClarksonPrinciplesofStakeholderManagement.html
) are useful to note.

Principle 1: Managers should acknowledge and actively monitor the concerns of all legitimate stakeholders, and should take their interests appropriately into account in decision-making and operations.

Principle 2: Managers should listen to and openly communicate with stakeholders about their respective concerns and contributions, and about the risks that they assume because of their involvement with the corporation.

Principle 3: Managers should adopt processes and modes of behavior that are sensitive to the concerns and capabilities of each stakeholder constituency.

Principle 4: Managers should recognize the interdependence of efforts and rewards among stakeholders, and should attempt to achieve a fair distribution of the benefits and burdens of corporate activity among them, taking into account their respective risks and vulnerabilities.

Principle 5: Managers should work cooperatively with other entities, both public and private, to insure that risks and harms arising from corporate activities are minimized and, where they cannot be avoided, appropriately compensated.

Principle 6: Managers should avoid altogether activities that might jeopardize inalienable human rights (e.g., the right to life) or give rise to risks which, if clearly understood, would be patently unacceptable to relevant stakeholders.

Principle 7: Managers should acknowledge the potential conflicts between (a) their own role as corporate stakeholders, and (b) their legal and moral responsibilities for the interests of all stakeholders, and should address such conflicts through open communication, appropriate reporting and incentive systems and, where necessary, third party review.

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