Management and Organization in Global Environment

Management and Organisation in a Global Environment

Stakeholder Relationship Management and its influence on Management Decision Making General Framework

Total words count: 3223

Executive Summary

This report involved the detailed study of stakeholder relationships and their influences over managerial decision making. The primary aim of this study is to outline steps to better stakeholder management and present how said relationships can positively enhance or negatively impact an organisation through case studies. The four steps to stakeholder management is, identification of stakeholders, determination of their interests and concerns, deciding critical stakeholders and formulate specific approaches. Not having a good stakeholder management means losses such as financial losses incurred by UK Passport Agency when they failed to communicate to their applicants and the media. Worse losses are not impossible, an organisation, BP, caused explosion and oil spillage into Deepwater Horizon in Mexico, which saw the loss of the lives of workers that worked on the platform, and lasting environmental damage to surrounding ocean. While stakeholder management seems difficult or impossible, but a good stakeholder management rewards an organisation in a number of ways. Multi-advocacy approach is a solution to better management, it is an approach that values stakeholder’s voices as much as a manager’s own judgement. Using the aforementioned steps combined with this approach, a manager can make organisational decisions while pleasing stakeholders.

Table of contents

Introduction:

Stakeholder relationship management is an important concern for the success or failure of organisations. All projects will have stakeholders, who are affected by the project or who can influence the project in a positive or negative way (Thompson n.d). While some stakeholders may have limited ability to influence projects and another have an important influence on the project, but it's all desired good results. They influence or directly impact on businesses strategies and plans, business activities and also for investment and resources. Stakeholder can be a part of the existence and development of the business. They have been identified as a pressure that affects all businesses in any industry. A poor stakeholder relationship can destroy everything to fail (De la Mata 2014).  Thus good relationship management ability can identify and manage stakeholders in the right way can gain a lot between success and failure.

This report will discuss about the poor relationship management with stakeholder and what is the consequence behind it. The four-step approach will be applied to these processes.  Moreover, a good relationship management will be discussed through analysis of external environment. It is important for managers to identify the different component of external environment.  There are separate into two parts: one is considered about general external environment and the other is focus on specific external environment.  Lastly, there is a discussion how the multi-advocacy approach can be applied and how it affects manager decision making to create and maintain a good relationship with stakeholders.

1. Stakeholder Relationship Management:

Managing effective relationship with the stake holders is vital for the success of any project because stakeholders have direct or indirect interest or concern with the organization. For the effective stakeholder relationship management, it is required to build, develop and maintain necessary working relationship among stakeholders. Stakeholder can be defined as a person, group or any organization that is affected by the output of any project action, decisions or policy of the organization and they have right to claim on organization’s recourses and outcome, stakeholders may be customers distributors, suppliers, employees, media, competitors and shareholders (Rajhans 2018). The idea of paying attention to stakeholder relationship is to influence attitudes, decisions and actions for the mutual benefits. There are four steps that must be taken into account at the start of any new project by the organization in order to maintain effective stakeholder management. If any of them is misunderstood or not taken in account then it will result in failure of the project.

1. Identifying Stakeholder
2. Determine stakeholder interest or concern
3. Decide critical stakeholder
4. Formulate specific Approach

Poor Stakeholder Relationship Management

The following case study will illustrate the poor relationship management and its consequences.

UK Passport Agency decided to change the old passport system into computerized processing system and provide safer passport. They aimed to implement this system in to Liverpool and Newport offices before the summer as the time was short, the agency failed to provide enough time about the learning of new system. The starting of the system had to be postponed and the agency was not able to handle the demand of new passports. Agency were facing two problems firstly unable to manage the accessing time of new passport system, secondly the poor contingency plan, lack of planning in the event were compounded by a further failure to adequately manage the Agencies most important stakeholders – the media and the general public (Stakeholder map n.d)