Any person or entity interested in a particular business is called a stakeholder. They are affected by the business activity, and they may be part of the core decision-making team. Internal and external stakeholders may have different interests and priorities, possibly leading to conflicts of interest.
Kinds of Stakeholders
Internal stakeholders are owners, managers and workers. External stakeholders are the customers and the suppliers. The community in which the organization does business also is a stakeholder. Not all stakeholders are equal, and different stakeholders will have varying considerations. These stakeholders can have direct or indirect stake in the organization and in policy-making.
Influence of Stakeholders
Different stakeholders have different influence. Owners have a major say in the way the company functions. Owners generally tend to extract the maximum efficiency and make the maximum profit from their investments in the company. Customers are also key stakeholders in any organization. The way they are catered to and their level of satisfaction determines how the company runs.
Primary and Secondary Stakeholders
Primary stakeholders are the most important people to the business, who have the strongest voice in the way the company runs. In small businesses, primary stakeholders are owners, staff and customers. These primary stakeholders decide the company policies and plans. In large businesses, primary stakeholders can vote the directors out if they feel the directors are not performing properly. Less influential stakeholders are referred to as secondary stakeholders.
Various stakeholders have various interests in the company. Owners want to maximize their profits and are interested in how well their business is functioning. Managers and workers are interested in their salaries and want to keep their jobs at all costs. Lenders want the businesses to repay their loans on time and in full. Customers want the company to produce high-quality products for affordable rates. They also look for good customer service before and after the sale. The community wants the company to be environmentally friendly.