Stakeholders are groups that have an interest in a business organization, including both internal and external groups. Internal stakeholders are members of the organization like owners, managers, and employees. External stakeholders include customers, suppliers, local communities, and governments. Some groups can be both internal and external. Stakeholders play important roles - owners provide capital, managers run operations, employees provide labor, customers purchase goods/services, suppliers provide resources, communities provide labor and markets, and governments establish regulations and economic policies that impact businesses. Understanding and effectively managing relationships with all stakeholders is important for business success.

1. Stake holders in business
Introduction
Stakeholders are groups of people
who have an interest in a business
organisation
They can be seen as being either
external to the organization,
or internal
But some may be both!

2. Types of stake holders
Capital Market share holders
Major suppliers of capital like Bank,
Private lenders and venture
capitalists

3. Types of stake holders
Product market shareholders:
Primary customers
Suppliers
Host communities
Unions

4. Types of Stake holders
I = Internal
E = External

5. Internal and External
Stakeholders
Internal stakeholders are those who
are ‘members’ of the business
organisation
Owners and shareholders
Managers
Staff and employees
External stakeholders are not part
of the firm

6. Some groups can be both internal and
external stakeholders
Such as staff or shareholders
who are also local residents
Can you think of any others?

7. Private Organizations
Joint Venture
partners and
Alliances
Governments
Supply Chain
Associates
Local Communities
and Citizens
Regulatory
Authorities
Unions
Investors,
Shareholders and
Lenders
Customers and Users
Employees
THE CORPORATION
Who are all stake holders?

8. Characteristics of Stakeholders
1. Owners and Shareholders
The number of owners and the roles they carry
out differ according to the size of the firm
In small businesses there may be only one owner
(sole trader) or perhaps a small number of
partners (partnership)
In large firms there are often thousands
of shareholders, who each own a small part
of the business

9. 2. Managers:
organise
make decisions
plan
control
are accountable to the owner(s)

10. 3. Employees or Staff:
A business needs staff or employees
to carry out its activities
Employees agree to work a certain number
of hours in return for a wage or salary
Pay levels vary with skills, qualifications,
age, location, types of work and industry
and other factors

11. 4. Customers:
Customers buy the goods or services
produced by firms
They may be individuals or other
businesses
Firms must understand and meet the needs
of their customers, otherwise they will fail
to make a profit or, indeed, survive

12. 5. Suppliers:
Firms get the resources they need to
produce goods and services from suppliers
Businesses should have effective
relationships with their suppliers in order
to get quality resources at reasonable
prices
This is a two-way process, as suppliers
depend on the firms they supply

13. 6. Community:
Firms and the communities they exist in
are also in a two-way relationship
The local community may often provide
many of the firm’s staff and customers
The business often supplies goods
and services vital to the local area
But at times the community can feel
aggrieved by some aspects of what a firm
does

14. 7. Government:
Economic policies affect firms’ costs
(through taxation and interest rates)
Legislation regulates what business can do
in areas such as the environment
and occupational safety and health
Successful firms are good for governments
as they create wealth and employment

15. CORPORATION
RESOURCE BASE
Investors: Shareowners & Lenders
Customers
& Users
Employees
INDUSTRY STRUCTURE
SOCIAL POLITICAL ARENA
Unions
Regulatory
Authorities
Supply Chain
Associates
Joint Venture
partners
& Alliances
Private
OrganizationsLocal communities
& Citizens
Governments
What is their business?

16. The End