Download Al Dunlap was famously quoted as saying that `The most ridiculous

Stakeholder
Negotiators
Al Dunlap was famously quoted as saying that ‘The most ridiculous term heard in the boardroom today is
“stakeholders”. Stakeholders! Every time I hear the word, I ask, “How much did they pay for their stake?”’
t
hankfully, not everyone holds to
Dunlap’s point of view when it
comes to stakeholder engagement.
More and more companies are
acknowledging that stakeholder
relations matter, not just because
the business imperatives are clear, but
also because we now live in an era of what
has been described as ‘relationship age
economics’
.
A growing body of evidence supports the idea
that building stakeholder relations through
specific engagement actually enhances
organisational performance. King III contains
some very specific recommendations in terms
of corporate governance and the competitive
advantage that is associated with improved
legitimacy. Stakeholder collaboration is now
widely regarded as a vital component in
managing corporate reputation.
Philip Kotler recognised the link between
relationship building and organisational
performance when he wrote, ‘If . . .
companies are to compete successfully
in domestic and global markets, they
must engineer stronger bonds with
their stakeholders, including customers,
distributors, suppliers, employees, unions,
governments, and other critical players in
the environment. Common practices such
as whipsawing suppliers for better prices,
dictating terms to distributors, and treating
employees as a cost rather than an asset,
must end. Companies must move from a
short-term transaction orientated goal to a
long term relationship building goal’.
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The organisational leader or marketer
who is serious about building stakeholder
relationships will soon discover that effective
and strategically aligned stakeholder
engagement can:
• Lead to more equitable and sustainable
social development by giving those who
have a right to be heard the opportunity
to be considered in decision-making
processes.
• Enable better management of risk and
reputation.
• Allow for the pooling of resources
(knowledge, people, money and
technology) to solve problems and
reach objectives that cannot be reached
by single organisations.
• Enable understanding of the complex
business environment, including market
services seta
What processes will we follow to
execute our strategy?
• What capabilities do we need to put
in place?
Leaders would do well to identify the
link between social identity, employee
engagement and a strong corporate
identity. The sooner we acknowledge
that the issues at stake are often not just
legal or financial, but often also moral, the
sooner we can begin to bring corporate
responsibility centre stage.
developments and identification of
new strategic opportunities.
Enable corporations to learn from
stakeholders, resulting in product and
process improvements.
Inform, educate and influence
stakeholders and the business
environment to improve their decisionmaking and actions that impact on the
company and on society.
Build trust between a company and
its stakeholders.
negotiated by some of the world’s largest
vehicle manufacturers.
The modern organisational leader will
need to demonstrate both ability and
willingness to identify key stakeholders
and acknowledge their right to be heard.
Giving an ear to key stakeholders must be
matched with a willingness to give account
for one’s actions. Effective stakeholder
negotiation should be built on the premise
of acknowledging what is important for
both you and your stakeholders.
•
Modern stakeholder interaction has
moved from simply managing perception
as drivers of corporate reputation to
managing relationships as drivers of
corporate reputation and resulting
business outcomes.
As marketers, we need to acknowledge
the impact of our actions on corporate
reputation, and demonstrate a commitment
to providing adequate and timely responses
to stakeholder queries.
Andy Brough is a Chartered Marketer,
lecturer, and organisational development
specialist. He teaches ‘Branding and
Stakeholder Collaboration’ as part of
the external faculty at GIBS .He can be
contacted at [email protected]
•
•
•
The organisational leader of the 21 st
century must be willing to identify the
key drivers of stakeholder relationship
collaboration including, but not limited
to, (a) the new legal and voluntary
obligations in place as a consequence
of corporate governance, (b) increased
public scrutiny and societal expectations,
(c) the opportunities presented by new
emerging markets, (d) the challenges
created by introducing new technologies,
and (e) specific critical events such
as the product recall currently being
Quite clearly, there is a need in the fields
of organisational/ leadership development
and
marketing
to
include
more
specific emphasis around stakeholder
collaboration. We have a responsibility
to develop a robust set of leadership
competencies required to negotiate this
very complex path. Think about these key
questions:
• Who are my stakeholders?
• What do I want from them?
• What do they want from me?
• What strategies do we need to put in
place to satisfy these wants?