Learn: Stakeholders

Welcome!Great to see you’re building on your knowledge of businesses! So far, you’ve explored why businesses exist, the types of ownership, and how they set their aims and objectives. Today, we’ll learn about stakeholders and their role in influencing a business.

What are Stakeholders?Stakeholders are individuals or groups who have an interest in or are affected by a business’s operations and decisions. They can influence how a business runs and whether it meets its aims or objectives. Stakeholders can be internal (inside the business) or external (outside the business).

Types of StakeholdersCommon stakeholders include:Owners: Focused on profits and business growth.Employees: Interested in job security, wages, and working conditions.Customers: Want good products/services and value for money.Suppliers: Depend on timely payments and long-term contracts.Local community: Concerned about ethical practices and environmental impact.

Stakeholders’ AimsEach stakeholder group has different priorities:Owners: Focus on profits and return on investment.Employees: Seek fair pay, job security, and good working conditions.Customers: Want quality products at affordable prices.Local community: Prefer businesses that act ethically and sustainably.

Conflicts Between StakeholdersStakeholders don’t always agree. For example:Owners may want to cut costs, but employees may want higher wages.Customers may demand lower prices, which could reduce profits for owners.Local communities may want sustainable practices, but these can increase costs.

Resolving Stakeholder ConflictsBusinesses try to balance different stakeholders’ needs. For instance, they might offer fair wages to keep employees happy while maintaining reasonable prices for customers. Compromise is often key.

How Stakeholders Influence Business DecisionsStakeholders can influence decisions based on their power and interest:Owners make major strategic decisions.Employees affect productivity and quality of work.Customers influence sales and reputation.Local communities impact public perception and support.

Review Time!Great work! You've learned about stakeholders, their aims, conflicts, and influence. Let’s review the key ideas with some questions.