Stakeholder Roles and HR Strategies in Leadership and Management

This report delves into the multifaceted roles of internal and external stakeholders in shaping business performance. It examines the positive and negative impacts of stakeholders such as employees, board of directors, investors, consumers, regulators, and suppliers. The report outlines how internal stakeholders influence the mission, vision, and strategic decision-making of a company, while also exploring potential negative consequences like internal disputes or misuse of company assets. Similarly, it analyzes the ways in which external stakeholders, including government and creditors, can both benefit and hinder a company's progress. Furthermore, the report emphasizes the importance of human resource implementation strategies, addressing the needs of both internal and external stakeholders. It also discusses principles of stakeholder relationship management and strategies like stakeholder mapping and communication, ultimately aiming to improve the governance and value of the firm. The report concludes by highlighting objectives to be achieved through assessing stakeholder relations strategies, underscoring the importance of balancing corporate goals with stakeholder needs.

Running head: Leadership and management
Leadership and management

Leadership and management
Table of Contents
Introduction.................................................................................................................................................3
Answer 1: Two positive ways internal stakeholders influence performance of the business entity............3
Answer 2: Two negative ways internal stakeholders influence performance of the business entity..........4
Answer 3: Two positive ways external stakeholders influence performance of the business entity...........4
Answer 4: Two negative ways external stakeholders influence performance of the business entity..........5
Answer 5: Two ways external stakeholders indirectly influence the performance of the business entity. .6
Answer 6: Human resource implementation strategy.................................................................................6
A. Needs of the internal stakeholders and external stakeholders...........................................................6
B.Two principles of stakeholders relationship management...................................................................7
C.Stakeholders relations strategies.........................................................................................................7
D.Two objectives to be achieved by assessing each stakeholder’s relations strategy.............................8
Conclusion...................................................................................................................................................8
References...................................................................................................................................................8
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Introduction
The paper talks about the roles of the internal stakeholders as well as external
stakeholders. It also explains the principles and strategies of the stakeholder’s engagement in
order to improve and enhance the performance of the business entity. It tells that how internal
stakeholders and external stakeholders influence the performance of the organization positively
as well as negatively.
Answer 1: Two positive ways internal stakeholders influence performance of the
business entity
Internal stakeholders include employees, board of directors, investors and managers
within the organization. The stakeholders are the persons or groups who have an interest in the
business entity to deliver the outputs and result in the organization. They also maintain
transparency and viability within the organization. The internal stakeholders influence the
effective and efficient performance of the business entity. The internal stakeholders directly
affect the growth and success of the company. There are two ways to which internal stakeholders
influence the effective and efficient performance and productivity of the organization. They play
a significant role to determine the mission, vision, and strategy of the company. In this way, they
influence the mission and vision of the company by formulating various types of strategies and
policies in the organization. Secondary, they take effective decisions to attain the long-term goals
and objectives within the organization. The internal stakeholders are the important part of the
each and every company. They influence the behavior of the other people also (Hansen,
Dunford, Boss, Boss & Angermeier, 2011).
Further, internal stakeholders exercise power to the other person to do work effectively
and efficiently. In this way, stakeholders influence the business activities and operations
positively. They help to increase and maximize the revenue of the company. They participate in
the planning process to reduce and minimize the risks and challenges of the market. The success
and growth of the business entity depend on the performance of the internal stakeholders. They
fulfill the resources requirements of the company. The internal stakeholders are involved in
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various activities and operations of the company. Now it is seen that internal stakeholder affect
the performance of the company positively (Beringer, Jonas & Kock, 2013).
Answer 2: Two negative ways internal stakeholders influence
performance of the business entity
Although internal stakeholders play a vital role to determine the long-term sustainability
and growth of the company but sometimes they affect the performance and productivity of the
company adversely. There are various ways to which internal stakeholders negatively influence
the effectiveness and efficiency of the business entity. Firstly, internal disputes can be raised
among the employees due to inequality and partiality thus it affects the performance and
efficiency of the workers. Sometimes disputes arise between the skilled and unskilled person in
the organization. Secondary, sometimes the board of directors uses assets of the company for
personal purpose, therefore, it affects the efficiency and effectiveness of the business entity
(Alniacik, Alniacik & Genc, 2011).
Further, the company delegates the power and authorities to unskilled employees hence
they are not able to proper use of the power and authorities due to lack of knowledge and
experience. The different salary structure of the employees and managers also influence the
profit and revenue of the company negatively. Further, the internal stakeholders are not able to
maintain proper communication and co-operation within the organization thus it affects the
business activities negatively. As result, it increases the cost of the company. The business entity
can attain long-term goals and objectives of the company by improving the performance of the
internal stakeholders within the organization. Further, the company should motivate and
encourage employees for doing work effectively and efficiently. In addition, the internal
stakeholders such as managers are not able to maintain control over the subordinates thus it
influences the efficiency and productivity of the company (Bingham, Dyer, Smith & Adams,
2011).
Answer 3: Two positive ways external stakeholders influence
performance of the business entity
The external stakeholders influence the business activities and operations positively as
well as negatively. The external stakeholders include consumers, regulators, government,
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suppliers, creditors and communities. These stakeholders affect the actions, policies and
objectives of the business entity. The external stakeholders are the end users and customers of
the company which determine the long-term success and targets of the firm. Firstly, external
stakeholders play an integral role to gain the competitive advantages in the global market. They
also maintain sustainability in the organization as well as the environment. Along with this, they
reduce and minimize the risk and key challenges of the global market (Wagner Mainardes, Alves
& Raposo, 2011).
The external stakeholders keep good knowledge and experience to overcome the competitors
globally. In this way, they are considered the key success indicator of the business entity to
evaluate and analyze the long-term growth and success of the company. In addition, they
maintain a control over the external environment to gain long-term benefits globally. Apart from
this, they maintain effective and unique communication with competitors to evaluate and analyze
the plans, policies, and strategies of the competitors around the world. Furthermore, external
stakeholders also make unique and effective strategies for the business entity to improve and
enhance the efficiency and performance of the business entity. Now it is assumed that the
external stakeholders are an integral part of the organization in order to fulfill the long-term
vision and mission of the firm to improve the productivity of the company (Lovejoy, Waters, &
Saxton, 2012).
Answer 4: Two negative ways external stakeholders influence
performance of the business entity
Sometimes, external stakeholders influence the business performance and efficiency
negatively. There are various ways through which external stakeholders affect the performance
and effectiveness of the business entity adversely. Firstly, the government intervenes in the
internal business activities and operation of the company thus; it affects the future goals and
objectives of the company. It also affects the environmental sustainability of the organization.
Further, the company takes loan from the banks and other institute but the company is not able to
repay these loan thus it negatively affects the efficiency and performance of the firm. The firm
has to face various challenges and key issues in the global market (Fernandez-Feijoo, Romero &
Ruiz, 2014).
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Further, the company is not able to focus on the entire external stakeholders around the
world. It can also affect the business actions and outcomes adversely. Along with this, external
stakeholders do not finish the work within the giving deadline thus they have to lose money. It
affects the success and development of the business entity. In this way, external stakeholders
influence the effective and efficient performance of the business entity. If the company wants to
expand and explore its business activities and operations globally then it should focus on the
needs, requirements, and expectations of the external stakeholders (Mason & Simmons, 2014).
Answer 5: Two ways external stakeholders indirectly influence the
performance of the business entity
The external stakeholders play various roles indirectly to beat the competitors in the
market. They are the investors in the company whose actions and duties determine and evaluate
the outputs and results of the business entity. They improve the financial performance of the
company by maintaining corporate social responsibility and sustainability in the organization as
well as the environment. They can predict the future risks and obstacles within the organization.
Secondary, the external stakeholders indirectly monitor and focus on the outsourcing activities
and globalization. They help to prevent the harmful activities within the organization. Further,
they sustain and maintain organization earning growth and success in the universal market.
Along with this, they also identify and evaluate the project activities and operations in the
organization and they help to reduce the project issues and risks of the market. Now it is assumed
that various indirect roles are played by the external stakeholders to determine and improve the
performance and efficiency of the business entity. In this way, they influence the success and
growth of the company indirectly (Ayuso, Rodríguez, García-Castro & Ariño, 2014).
Answer 6: Human resource implementation strategy
A. Needs of the internal stakeholders and external stakeholders
The internal stakeholders are considered the people of the business entity. They affect the
success and growth of the company directly. The employees of the company want meaningful
work thus it is primary need of the internal stakeholders in the business entity. The meaningful
work can be possible by providing reward and compensation to the internal stakeholders within
the organization. Rewards and incentives also provide satisfaction to the employees. Along with
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this, employees want good working environment and culture to do work more effectively and
efficiently.
On the other hand, external stakeholders want to attain and achieve long-term profit and
revenue in the global market. It is foremost need of the external stakeholders. In addition,
external stakeholders want to attract more customers in the market by fulfilling the needs and
requirements of the consumers around the world. Further, they want to gain and increase the
profit and revenue in the organization (West & Bogers, 2014).
B.Two principles of stakeholders relationship management
The principles of stakeholders’ relationship management play a vital and crucial role to run
the business smoothly. The main aim behind the principles of the stakeholders’ management is to
provide guidelines and suggestion to the company and it also maintains a balance between
corporate goals and needs of the organizational stakeholders. The two principles of the
stakeholder’s relationship management have been discussed below.
 The managers and top management must consider the stakeholder's concerns while taking
effective and unique decision within the organization in order to determine the long-term
goals and objectives of the firm.
 The top management and managers should communicate with stakeholders effectively
and efficiently and they must fulfill the needs and requirements of the stakeholders. It is
another principle of the stakeholders’ engagement in the business entity (Mok, Shen, Q.,
& Yang, 2015).
C.Stakeholders relations strategies
The two stakeholders’ relations strategies to assist and support the business entity in order to
achieve the principles of the stakeholders’ relationship management have been discussed below.
 Stakeholders mapping is one of the significant strategies of the stakeholders in order to
attain the principles of the stakeholder’s relationship management. This strategy also
helps to identify and evaluate the internal stakeholders as well as external stakeholders.
 Communication is also another strategy of the stakeholders in order to build and develop
an effective relationship with stakeholders. The firm should set the communication
pattern on regular basis to meet the long-term goals, mission, and vision of the firm.
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These strategies play an important role to accomplish the needs and requirements of the
stakeholders within the organization (Henisz, Dorobantu & Nartey, 2014).
D.Two objectives to be achieved by assessing each stakeholder’s relations
strategy
HRM plays a vital role to make effective and unique strategies for the stakeholders within
the organization. The main objective of the company is to increase and maximize the value of the
firm by using the stakeholders’ relations strategy in the organization. Therefore, the firm focuses
on the short term profits as well as long-term profits. The other objective of assessing the
stakeholders’ relations strategy is to influence the governance of the firm in order to meet the
individual goals and objectives. Along with this, the stakeholder’s wants to reduce and minimize
the risk and challenges of the company by implementing stakeholder’s relations strategy. In
addition, the company uses performance indicators such as grievances mechanism and
information disclosure indicator to resolve and reduce the various issues and problems of the
stakeholders in the business entity (Luo, Wang, Raithel & Zheng, 2015).
Along with this, stakeholder’s identification and analysis indicator are used by the
company to analyze and evaluate the needs and requirements of the stakeholders within the
organization. In this way, the company can take the support of the human resource management
to build and develop effective strategies of the stakeholders (Barnett, 2014).
Conclusion
On the above discussion, it has been concluded that stakeholders play an integral role in
each and every business entity to expand and explore the business globally and to attain long-
term profit and revenue in the global market. Therefore, the business entity must protect the
rights and interest of the stakeholders within the organization.
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References
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influences stakeholders' intentions. Corporate social responsibility and environmental
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Ayuso, S., Rodríguez, M. A., García-Castro, R., & Ariño, M. A. (2014). Maximizing
stakeholders’ interests: An empirical analysis of the stakeholder approach to corporate
governance. Business & society, 53(3), 414-439.
Barnett, M. L. (2014). Why stakeholders ignore firm misconduct: A cognitive view. Journal of
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Beringer, C., Jonas, D., & Kock, A. (2013). Behavior of internal stakeholders in project portfolio
management and its impact on success. International Journal of Project
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Bingham, J. B., Dyer, W. G., Smith, I., & Adams, G. L. (2011). A stakeholder identity
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Fernandez-Feijoo, B., Romero, S., & Ruiz, S. (2014). Effect of stakeholders’ pressure on
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Lovejoy, K., Waters, R. D., & Saxton, G. D. (2012). Engaging stakeholders through Twitter:
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