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uk
Meeting the Needs
of Stakeholders
BTEC Business
Copyright 2007 – Biz/ed
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What are Stakeholders?
• Stakeholders are groups of people
who have an interest in a business
organisation
• They can be seen as being either
external to the organisation,
or internal
• But some may be both!
Copyright 2007 – Biz/ed
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Types of Stakeholder
• Owners (I) • I = Internal
• Shareholders (I/E)
• Managers (I)
• E = External
• Staff or employees
(I)
• Customers (E)
• Suppliers (E)
• Community (E)
• Government (E)
Copyright 2007 – Biz/ed
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Internal and External
Stakeholders
Internal stakeholders are those who are
‘members’ of the business organisation
• Owners and shareholders
• Managers
• Staff and employees
• External stakeholders are not part
of the firm
Copyright 2007 – Biz/ed
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But…..!
• Some groups can be both internal
and external stakeholders
• Such as staff or shareholders
who are also local residents
• Can you think of any others?
Copyright 2007 – Biz/ed
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Characteristics of
Stakeholders
1. Owners and Shareholders
• The number of owners and the roles they carry
out differ according to the size of the firm
• In small businesses there may be only one
owner (sole trader) or perhaps a small number
of partners (partnership)
• In large firms there are often thousands
of shareholders, who each own a small part
of the business
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Characteristics of
Stakeholders
2. Managers:
• organise
• make decisions
• plan
• control
• are accountable to the owner(s)
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Characteristics of
Stakeholders
3. Employees or Staff:
• A business needs staff or employees
to carry out its activities
• Employees agree to work a certain number
of hours in return for a wage or salary
• Pay levels vary with skills, qualifications, age,
location, types of work and industry
and other factors
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Characteristics of
Stakeholders
4. Customers:
• Customers buy the goods or services produced
by firms
• They may be individuals or other businesses
• Firms must understand and meet the needs
of their customers, otherwise they will fail
to make a profit or, indeed, survive
Copyright 2007 – Biz/ed
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Characteristics of
Stakeholders
5. Suppliers:
• Firms get the resources they need to produce
goods and services from suppliers
• Businesses should have effective relationships
with their suppliers in order to get quality
resources at reasonable prices
• This is a two-way process, as suppliers depend
on the firms they supply
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Characteristics of
Stakeholders
6. Community:
• Firms and the communities they exist in
are also in a two-way relationship
• The local community may often provide many
of the firm’s staff and customers
• The business often supplies goods
and services vital to the local area
• But at times the community can feel aggrieved
by some aspects of what a firm does
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Characteristics of
Stakeholders
7. Government:
• Economic policies affect firms’ costs (through
taxation and interest rates)
• Legislation regulates what business can do
in areas such as the environment
and occupational safety and health
• Successful firms are good for governments
as they create wealth and employment
Copyright 2007 – Biz/ed
