Chapter 2 – Stakeholdersand Issues Management Approaches By: Sarah Obaidee Joseph Olivas Meghedi Dirghazarianmalhami
What is a stakeholder? Individual or group that affects all aspects of decision making in an organization. Primary stakeholders are individuals immediately affected by the organization. i.e. suppliers, owners, employees, etc. Secondary stakeholders include a variety of interest groups. i.e. media, lobbyist, etc.
What is a stake? A stake is any interest, share, or claim that a group or individual has in the outcome of a corporation’ policies, procedures, or actions towards others. Stakes of being a student at Woodbury University? Interest? Education,…..?
Stakeholder’s Approach Theory that preaches ethical behavior in order to gain a competitive advantage. Lowes Strives to reach “win-win” outcomes. Companies that practice this Home theory in their industry tend to get Depot a leg up on their competitor. i.e. Lowes v Home Depot.
Stakeholder Analysis Assist in the understanding between an organization and its constituents. Due to the uniqueness of each situation, the approach must be mapped out in order to develop a strategy. The framework is developed not only for individuals in high ranking positions, but also so any employee may see the corporate dealings.
Role of the CEO in StakeholderAnalysis The role of a CEO is to get a handle of the situation to help approach and mediate concerns from customers, media, etc. CEO is there to answer the who, what, where, why, when, and how of the situation
Stakeholder Analysis in 7 Steps1. Map stakeholder relationships2. Map stakeholder coalitions3. Assess the nature of each stakeholder’s interest4. Assess the nature of each stakeholder’s power5. Construct a matrix of stakeholder moral responsibilities6. Develop specific strategies and tactics7. Monitor shifting coalitions
Stakeholder Dispute Resolution Methods Dispute resolution is a tactic also known as “alternative dispute resolution” Dispute resolution is a variety of methods to help possible litigants resolve conflicts Ranges from parties taking control of process to giving control to a third party i.e. face to face negotiation and litigation
Ethical Reasoning for Stakeholders Ethical reasoning involves trying to analyze what is fair and who is being affected by the actions. Involves helping and identifying the weaker and quiet stakeholders getting their voices heard in the decision process What can be done when stakeholder are not being treated fairly?
Moral Responsibilities The analysis ensures that managers are prepared to define their own moral responsibilities, as well as those of the company. The approach focuses the organization’s attention on both internal and external areas. Managers are liable for the morals of the company, that can quickly be made public due to technology. If a stakeholder knows the roles, it clarifies the responsibilities of the task.
Issue Management Issue management is used to forecast the actions to take for emerging factors that have an impact on organizations and stakeholders. Controversy can be avoided if proper issue management is implemented. The evolution of an issue can be traced with proper issue management.
Moral Dimension of Stakeholder and IssueManagement Studies argue that being moral is “issue dependent” They argue that the severity of the issue is what triggers reasoning. Morals are necessary in leadership positions, as the decisions affect all stakeholders. Identifying issues and ensuring that they are moral is a goal for all managers to benefit their company.
The Two Frameworks Frameworks can be used to map and manage issues before they arise. Frameworks can also be used to plan and manage to prevent, or to handle issues that may have already arisen. Frameworks are not organization specific Stakeholder analysis can display why strategies and actions stunt the evolution of an organization.
First Approach The six-step issue management process. Environmental scanning and issues identification. Issue analysis Issue ranking prioritizing Issue resolution strategizing Issue response and implementation Issue evaluation and monitoring.
Felt NeedSecond Step Seven-phase issue development process. Media Coverage Litigation A felt need arises Media coverage is deployed Interest group development Policies are adopted by leading political jurisdictions Interest Group Legislation The federal government Development and Growth and Regulation gives attention to the issue. Issues and policies evolve into legislation and regulation Issues and policies enter litigation. Leading Political Jurisdictions Federal Government Attention
Managing Crises Crisis management emerged from observing how corporations and leaders react to crises. Steven Fink describes crisis as “a turning point for better or worse.” The direction that organization moves into is dependent on the leaders’ reaction.
Four Crisis Management Stages Pre-crisis Prodromal stage Warming; symptoms Crisis Occurs Acute stage Point of no return Lingering Chronic stage Self-doubt, self-analysis Health restored Conflict resolution stage Return to normalcy
First Stage Prodromal Stage Warning stage Does not always occur or is not evident. This stage should be carefully observed. Must be taken seriously in order to prevent crisis. If does not occur, or is ignored, the point of no return quickly occurs.
Second Stage Acute Crisis Damage has already occurred Damage control must be administered Stage where the severe damage occurs Considered the shortest stage
Third Stage Chronic crisis Clean up phase Time of healing, recovery ,and self analysis Studies have shown when there is no crisis plan set companies stay in this phase 2.5 time longer
Fourth Stage Crisis Resolution Final stage – Crisis Management Goal “What can and should an organization do to speed up this phase and resolve crisis once and for all?”
How Executives Have Respondedto Crisis? Five phases of corporate social response to crises Used to evaluate and examine moral responsibilities of corporate response 1. Reaction 2. Defense 3. Insight 4. Accommodation 5. Agency