Who comes to your mind, when you hear about the word ‘stakeholder’? Our shareholders? Certainly… Who else? Our customers? Definitely… And who else? ‘…!”. Most organizations don’t much think about their stakeholders. Stakeholders vanish in daily operations. However, it is evident that different stakeholders have different contributions, requirements and expectations with regards to our organizations. Therefore, it is important to address each stakeholder uniquely, and to consider and manage how our relationships and interactions with them should be.
Let us take our Customers… Customers, who trust our product, service, relationships and the value we offer, will be more likely to become our ‘regular customers’. In terms of profitability and growth, we both need our regular and new customers. In general, their basic expectation is to quickly access the products and services they want with a fair price. Beyond knowledge and ideas, customers’ decision systems are significantly affected by our relationships and the experience we create, as well as their own impressions and perceptions.
Our employees, in other words, our ‘people’… We want them to engage in their work with energy and passion. We do not have the right to expect this engagement from only the skilled, but from the entire workforce. Therefore, the goal should be to ensure alignment, care with interest, develop their skills and knowledge, and make efforts to increase their motivation; last but not least, hear their voice. Usually, Human Resources Management is underrated as we take people for granted.
Our Suppliers… We expect our Suppliers to provide the raw materials, intermediate products, services and information for us with the right pricing and speed, just as we provide those for our Customers. Efficiently managing our supply chain is essential in terms of profitability and customer satisfaction. However, while meeting all these expectations, our Suppliers want to trust in our relationships, our promises, and of course in our sensitivity to payments in time. While dealing with competition, we feel the pressure of cost and speed from our customers and so we reflect those feelings on our suppliers. In this respect, there is no simple equation to satisfy everybody.
Our Distribution and Service Channels… represent our brand, deliver our products and services to end users and Customers. Those channels are varie like wholesalers, distributors, retail chains, stores, branches, franchises, sales representatives, Internet, social and mobile media, etc. We may also include our Alliances and Business Partners in this variety. Realizing balanced and integrated access strategies, managing product and service operations efficiently across all these channels, and ultimately making our Customers satisfied and keeping our Alliances, Business Partners, Distribution and Service Channels profitable is an important field waiting for solution.
Our Investors and Shareholders… The ultimate liability of a commercial organization is towards its investors and shareholders. Exhibiting an effective management to raise ‘money/cash’ is the absolute key factor for the satisfaction of these bodies who invest capital, open loans, make an investment, offer resources and support, and undertake risks. What did they invest in, how much money and which resources did they transfer and what did they get in return? Those are essential questions for them. They would like to see concrete results/outcomes as turnover, profitability, market share…. Moreover, they expect us to be able to consistently and continuously present these concrete figures. Our competencies such as planning, budget management, management of financial resources, cash flow, etc. will need to be sharply improved. Besides, the impact of value and reputation of the brand should not be underestimated. They should also be constantly improved.
While managing relations with all these stakeholders, we should also be able to manage the compulsory and voluntary engagement with bodies in the ecosystem like, Legislators, Policy Makers (such as Government), Standard Setters (such as Standards Institute), Influencers (such as Non-Governmental Organizations-NGOs, Lobbies, Opinion Leaders), etc.
In fact, all our stakeholders are connected through an invisible chain (even better, a network).
Value Chain Analysis is a very valuable tool for companies. While identifying the outcomes such as products and services, as we as financial and business results, it helps to understand and determine which activity adds value, at which stage, at what cost, at what outcome, with which resource and competencies.
Release: SME-EFOR January 2013