a. Undertake a detailed Stakeholder Matrix. Please refer to page 162 of the ‘Little Book’ for guidance. Once completed, please number and reference as evidence. For additional support and different types of stakeholder, mapping techniques go to:
a) A Stakeholder Matrix
Tesco has various stakeholders with particular interests and influence. As such, management endeavours to ensure that the needs and concerns of every stakeholder group are satisfied and met as speedily as possible. Commonly, Tesco stakeholders include employees, senior management, lenders, the government, customers, the marketing agencies, and media outlets, families of the employees, strategic advisors, management consultants, and, shareholders.
Ideally, each of these stakeholder groups bears some level of interest and power that the company cannot ignore. To clearly understand how the company manoeuvres between the benefits and abilities of these stakeholders, the stakeholder matrix bellows provides some insights.
Stakeholder Matrix (Thompson, R., n.d, para. 1)
Basing on the above matrix, stakeholders in Matrix A have substantial power in the company. Still, they are never that interested in the day-to-day activities, including strategy, of the business. The company needs to keep this group of stakeholders satisfied such that they do not start meddling when they realise their needs are not being met. Matrix B is stakeholders who wield substantial power and are highly interested in the day-to-day activities of the company. The company must manage this stakeholder group carefully since they can undermine the business in many ways if they fall out of favour with management, for example. Matric C comprises stakeholders with less power but who are highly interested in the day-to-day activities of the firm. This stakeholder group must be kept informed at all times of every move being made and its implications. Last but least, Matrix D comprises stakeholders with less power and less interest in the day-to-day activities of the firm. This stakeholder group requires monitoring, but not much effort should be employed in doing this.
Note evidence number here:
EV 3 Stakeholder Matrix…………………………
b. Specify your stakeholders’ roles and their responsibilities in strategic business planning and development and evaluate their positions and explain how you involve them in the process.
Stakeholders’ Roles and Responsibilities in Strategic Business Planning and Development
Stakeholders play an essential role in strategic business planning and development. Judging by the stakeholder matrix above, it is clear that there different stakeholder groups that differ in terms of the power they wield over the company or management and the level of interest they have in the day-to-day activities of the business. One of the daily activities at Tesco is overseeing the implementation of the overall business plan. This means that those stakeholders with some level of interest in the day-to-day operations of the firm might want to be involved in strategy formulation and implementation. Considering the diverse types of stakeholders that the company has, the roles and responsibilities of these stakeholders differ in equal measure. For example, lenders are significant for their role as financiers of the vision, while the executive leadership is responsible for overseeing the implementation of the image. Tesco employees are the implementers of the image, and their work is to ensure that this vision comes to fruition. The role of the media is to ensure that the message of Tesco is communicated to the market, while shareholders, just like lenders, are responsible for providing the financial muscle for the vision to come to pass.
Ideally, all these stakeholder groups are involved in the strategy formulation and implementation process in diverse ways. For example, the annual general meeting (AGM) is the leading platform that brings together the shareholders of the company and every other stakeholder with a keen interest in the financial performance of the firm. Besides the AGM, there are other platforms, including weekly, monthly, and quarterly meetings, where various stakeholders lock horns in assessing multiple aspects of the company. It is through these forums that matters of grave concern are escalated to the highest echelons of the company leadership for attention and resolution.
Evaluate the impact of operational and financial strategies and objectives on internal and external stakeholders. Consider in your answer ‘both’ operational strategies/objectives and financial strategies/objectives. On ‘both’ internal stakeholders (think of staff) and external stakeholder (consider customers/suppliers/contractors)
Evaluation of the Impact of Operational and Financial strategies
The operational and financial objectives within Tesco’s overall business strategy have significant implications for both internal and external stakeholders of the firm. As far as internal stakeholders (particularly employees) are concerned, both operational and financial objectives of the company are of great significance. Firstly, through positive revenue growth, the company is better placed to pay good salaries, among other benefits to the staff. Additionally, the company can expand and thereby expand the opportunities available for every employee to progress in their career. Concerning operational objectives, attaining a favourable growth in market share every quarter will see the company achieve substantial brand equity in the industry, thus expanding the opportunities for staff members in the global retail sector.
Regarding external stakeholders, including suppliers, consultants, and customers, both financial and operational objectives of the company are of significant implications. Firstly, continued profitability would mean that the company can settle its bills on time, including fees owed to consultants and monies owed to suppliers. Further, a healthy balance sheet would mean that Tesco can invest in R&D and offer innovative products and services to the target markets. Regarding operations, having a competitive edge in the market will drive the company to enhance its customer service experience to retain its improved public image. Additionally, meeting and exceeding customer needs and expectations will position the company advantageously in the mind of the consumer, thereby enhancing word-of-mouth advertising in different market segments. This has the potential to place the company on a growth trajectory that will see regional expansion in the whole of Europe and Asia.
By completing task 8, you should have met the following assessment criteria: –
700 1.4 Evaluate the role of stakeholders in the development of strategic business plans
and explain how to involve them
700 1.5 Explain how to involve stakeholders in the developments of strategic business plans
703 2.3 Characterise the scope and nature of stakeholder’s interests
703 3.3 Specify stakeholder’s roles and responsibilities in strategy development
702 3.2 Evaluate the impact of operational and financial strategies and objectives on internal and external stakeholders
McGrath, J. and Bates, B. (2017). The little book of big management theories. Harlow, England: Pearson.
En.wikipedia.org. (2017). Stakeholder analysis. [online] Available at: https://en.wikipedia.org/wiki/Stakeholder_analysis#Methods_of_stakeholder_mapping [Accessed 5 Nov. 2017].
Mindtools.com. (2017). Stakeholder Analysis: Winning Support for Your Projects. [online] Available at: https://www.mindtools.com/pages/article/newPPM_07.htm [Accessed 5 Nov. 2017].