Stakeholders Stakeholders are the ones who have a stake in the organization and thus in some way or the other are related to the organization. This broad definition of stakeholders often leads to confusion; hence a more narrow definition was derived that explains “group who are vital for the organization or groups that help to define the organization, its mission, purpose and goals, and or are most affected by the activities of the organization” (Lebeer, 2002, p. 181). Considering the above given definition, the stakeholders of Verizon can be segregated as internal as well as external stakeholders.
Everybody who works for the organization can be considered as the internal stakeholder (Banhegyi, 2009, p. 395). The employees of Verizon are the internal stakeholders of the company; however the families of these employees are also considered to be a part of internal shareholders. The external stakeholders are the ones who are not a part of the organization, but have interest in the company (McManus, 2005, p. 147). In Verizon, the customers are considered as one of the most important external stakeholders. Apart from customers, the shareholders and the investors are also of great importance.
Other external stakeholders are the government, the public, and the environment. According to stakeholders’ theory, the stakeholders should be identified and segregated into different groups depending upon the power and interest the exercise on the organization. This segregation is often called power grid. According to it, the stakeholders can be segregated into four different groups, these are: High power-High interest:These stakeholders have active interest in the day to day functioning of the firm, so they should actively participate in managing the organization.
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Interest coupled with power gives them the authority to take decision and set policies. Example: The management High interest-Low power: These stakeholders are interested in participating in the activities related to the organization but due to lack of power they cannot actively participate in the decision making process. The organization should keep them informed regarding the decision taken. Example: The employees High power-Low interest:The stakeholders who possess the power but are unwilling to participate in different organizational activities belong to this group.
The management tries to appease this section of the stakeholders as far as possible. Example: Investors Lower interest-Low power:This set of stakeholder neither have the power to participate in the decision making activities nor do they have the interest to participate in any kind of activity related to the organization. Therefore, the organization should not pay much attention to them but their activities should be monitored on time to time basis. Example: Government, social interest groups, suppliers, etc. Figure 1: Power Grid (Source: Davies, 2007, p. 36)
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