A stakeholder is a person who has an interest in the company, IT service or its projects. They can be the employees of the company, suppliers, vendors or any partner. They all have an interest in the organization. Stakeholders can also be an investor in the company and their actions determine the outcome of the company. Such stakeholder plays an important role in defining the future of the company as well as its day-to-day workings.
Types of Stakeholders
- Internal Stakeholders: They are a part of the management of the company and have voting powers. They are the major investors in the company and a part of the board of directors. Therefore they have all the powers that other higher-level management have and can change the direction of the company.
- External Stakeholders: Unlike internal stakeholders, their major role is to invest or disinvest in the company. They hardly can bring any change in the company’s direction. They do not take part in any internal operations or decision making of the company.
Roles of Stakeholders
- Direct the Management: The stakeholders can be a part of the board of directors and therefore help in taking actions. They can take over certain departments like service, human resources or research and development and manage them for ensuring success.
- They Bring in Money: Stakeholders are the large investors of the company and they can anytime bring in or take out money from the company. Their decision shall depend upon the company’s financial performance. Therefore they can pressurize the management for financial reports and change tactics if necessary. Some stakeholders can even increase or decrease the investment to change the share price in the market and thus make the conditions favorable for them.
- Help in Decision Making: Major stakeholders are part of the board of directors. Therefore they also take decisions along with other board members. They have the power to disrupt the decisions as well. They and bring n more ideas a threaten the management to obey them. The stakeholders also have all the powers to appoint senior-level management. Therefore, they are there in all the major decision-making areas. They also take decisions regarding liquidations and also acquisitions.
- Corporate Conscience: Large stakeholders are the major stakeholders of the company and have monitored over all the major activities of the company. They can make the company abide by human rights and environmental laws. They also monitor the outsourcing activities and may vote against any business decision if it harms the long term goals of the company.
- Other Responsibilities: Apart from the above four major roles they also have some other roles to play in the company. They can identify new areas for market penetration and increased sales. They can bring in more marketing ideas. They also attract other investors like honeybees in the company. They can be a part of a selection board or a representative for the company. Moreover, they can take all the major social and environmental decisions.
Internal stakeholders are key management of the company and therefore must be considered seriously. They have their own rights and duties, therefore, they are of utmost importance for the better future of the company. They must also take their roles seriously and work towards its betterment.
To understand more about the key role of stakeholders, you can join our webinar for successful onboarding process. In this webinar, you can learn about the roles and responsibilities of Executive management, human resources, the new hire’s manager.