The Various Primary And Secondary Stakeholder

Published Date: 02 Nov 2017

Abstract

Stakeholders represent individuals, groups, or institutions that are likely to be affected by the company as they have one or more of the diverse kinds of stakes within the organization. Stakeholder involvement can avail functional information in highlighting feasible options that enhance select outcomes. Communication can be regarded the only means to realize understanding and balance between the company and stakeholder interests. The core aim of stakeholder dialogue, in addition to building trust, and increasing awareness is to avail insights that allow policy makers to deliver political choices in an informed fashion.

Introduction

Reeds Machine & Mfg. Inc. is a company engaged in the design, development, manufacturing, inventory, and distribution of electrical components. The products that the company manufactures include capacitors, circuit modules, EMI Suppression filters, Multilayer ceramic devices, resistors, inductors, sensors, sound components, resonators, power supplies, ceramic applied products, filters for communication equipment, and noise suppression products.

Reeds Machine & Mfg. Inc. offers a one-stop manufacturing of diverse components utilized in the manufacture of mobile phones, health-care equipment, automotive, televisions, and home electrical appliances. The company pursues to exceed its customer’s expectations with regard to quality and delivery via continuous enhancement and customer interaction.

The company possesses a long-standing commitment to operating responsibly. This requires that the company works hard to comprehend and respond to society’s expectation of being a responsible manufacture, employer, marketer, distributor, and corporate citizen.

#1 The Various Primary and Secondary Stakeholder Groups, their Roles, and Relationships

Stakeholders making direct claims to the company include trade unions, shareholders, employees, creditors, customers, suppliers, and local communities. Internal stakeholders characteristically entail employees and management, customers, suppliers plus other business partners, and local communities, whereas external stakeholders will encompass government and regulators, trade bodies, clients, competitors, and trade unions.

Primary stakeholders possess a direct interest in the organization and characteristically sustain their livelihoods directly via the organization or make use of the company in a straightforward way. Primary stakeholders may or may not be influenced by decisions or actions relating to a certain resource, and may or may not part of decision making regarding the resource. Examples of primary stakeholders in the company include shareholders, customers, and employees.

Secondary (external) stakeholders entail, but not limited, government agencies, general public, financial analyst, stock brokers, media, state or local government unit, and potential investors. The external stakeholders are mainly interested in the financial report of performance, as well as the condition of the business specific relevant concerns such as a collection of taxes and licenses, probable returns of investments for potential investors, publicity, and public awareness.

Owners’ represents individuals or groups who have invested capital resources within the business, and are primarily interest in the financial reports reflecting how the business is performing or profiting. Employees represent individuals or groups that work within a business entity or organization and provide their professional services, skills, and talents in exchange for pay and professional development.

Suppliers represent individuals, groups, or entities that deliver goods or services to the company. Suppliers remain interested in the business condition, and performance to establish the extent of credit discounts or grace periods granted. Creditors' primary interest centers on the financial reports and establishing whether they will be able to collect and recover their financial investment. The company’s corporate citizenship is alive within the community; among other aspects, the company pays taxes based on the profits that the company makes.

#2 Ways in which the Stakeholders can Influence the Destiny of the Company

Overall, stakeholders possess key attributes such as power, legitimacy, and urgency and can significantly influence the destiny that the company takes. One of the ways in which stakeholder has impacted on the company entails promoting the development of internal control system to guarantee the suitability of operations, consistently promote operational standardization, visualization, enhancements, and reforms. This is designed to enhance monitoring functions to guarantee operational suitability to enhance the transparency and effectiveness of the corporate governance system. Stakeholders also seek to promote compliance and strengthen risk management to streamline the operation of the system.

#3 A Plan on encouraging Stakeholders to Form a Coalition

A coalition refers to an alliance between various stakeholders and the company that coalesce together to address a certain challenge or issue and attain a common objective/interest. Objectives that highlight system-wide changes and collaborations demand a broad array of expertise that aligns with coalitions. For any coalition to be effective, it ought to able to attain set goals and objectives of which every stakeholder anticipates benefiting from, but cannot attain on his or her own.

Success coalition building demands a commitment to engage with the company’s stakeholders, listen to them, construct a relationship with them, and react to their concerns in a mutually beneficial manner. Coalition building in this case is not an end in itself, but rather a means to aid construction of better relationships with the society in which the company operates, eventually yielding enhanced business planning and performance.

The formation of a plan for coalition building takes several steps, namely: prepare, plan, design, engage, evaluate, and apply. Preparing entails aspects such an identifying issues, prioritizing the issues and highlighting stakeholder categories. The Plan category detail aspects such as establishing objectives, scope and accountability, mapping/prioritizing stakeholders, determining engagement mode, and establishing evaluation criteria.

The design category entail reviewing principles, conducting initial outreach, establishing mutual objectives, highlighting technique and an urge for facilitation, and designing engagement. Other steps include engage, evaluating, and applying. Stakeholder participation within the decision-making process (either active or passive) pioneers a collection of ideas, experiences, and expertise that inspire the development of alternative solutions, which, in turn, enhances the knowledge of the actors engaged in decision-making and implementation of the project.

The formation of a coalition requires stakeholder engagement-dialogue as a means of responding to various challenges that the company faces. This demands constructive engagement between all stakeholders. Stakeholder engagement refers to the process of engaging individuals and groups impacted by the activities of the entity in a positive way. The aim of forming a stakeholder coalition is to respond to the interest of all stakeholders and maintain social and ethical responsibility and performance.

The first step in the plan entails stakeholder identification that can be influenced by the decision. The company needs to establish filters to separate significant stakeholders from less critical ones in the decision making process; otherwise, the dialogue would entail everyone and everything. Having highlighted stakeholders, the next step entails responding to the needs of the stakeholders informed by the fact that stakeholders frequently manifest "diverse and contradicting goals, priorities, and demands."

For this approach to receive broad acceptance, dialogue and engagement can deliver promising results through communication, consultation, dialogue, and exchange. The success of stakeholder engagement depends on whether the engagement will be across-the-board, comprehensive, and balanced. Effective stakeholder relationship remains attained in dialogue and building relationships with a majority of stakeholders so as to highlight better ways of conducting business.

This dialogue can take multifaceted forms and may encompass information regarding the company’s conduct to an open dialogue on a broad range of issues. The level of engagement encompasses aspects such as inclusion, openness, empowerment, transparency, and tolerance. This requires holding regular coalition meetings, creating and sustaining management system that facilitates information-sharing. The success of the coalition depends on strong leadership and having concise expectations.

Assistance that the Coalition could provide

The coalition of the stakeholders can help the company, in particular, unmask the prevailing assumptions. This arises from the fact that the company has conventionally made assumption regarding consumers’ devoid of testing the assumptions, especially with regard to pricing of the electronic products. This even becomes more complicated regarding secondary stakeholders as the company does not characteristically have data about them.

The coalition of stakeholders can yield to informed decision making as stakeholders frequently possess a wealth of information critical to propelling the company forward. Stakeholders’ involvement facilitates the transparency of public and private actions, which can yield to long-term collaborative relationships.

#4 Challenges in Encouraging Stakeholders to Form a Coalition

Over the course of coalition building, conflicts and power struggles may emerge. Some of the conflicts may be predicted from the outset while others may be established overtime. Most conflicts are likely to manifest during the collaboration process, and it is essential to address them constructively. Conflict may stem from coalition lacking inclusivity and consensus, stakeholders failing to share the responsibility, and lack of a clear definition of the problem and failure to develop a shared sense of purpose.

Conclusion

Stakeholders should be availed with a suitable level of information corresponding to their engagement and decision making. One of the challenges that confront companies entails maintaining a balance in the needs of both primary and secondary stakeholders. These two groups frequently possess common interest, but in some instances possess conflicting interests. It is critical for the organizational leaders to comprehend the impact on the needs and influences of both groups.