Facebook Stakeholder Analysis Report: Challenges and Strategies

This report provides a comprehensive stakeholder analysis of Facebook, examining its mission, vision, and recent developments within the context of industry trends and challenges. It begins with an introduction to Facebook, outlining its core values and the challenges it faces, such as monetization pressures and governance issues. The report then presents a stakeholder view model, identifying key stakeholder groups including users, advertisers, employees, the government, and communities. A significant portion of the report is dedicated to a detailed stakeholder analysis, applying strategies (Swing, Offensive, Defensive, and Hold) to four selected stakeholder groups. The analysis assesses how Facebook addresses the interests and concerns of each group, including employees, users, and the government. The report concludes by highlighting the importance of stakeholder management in driving Facebook's success.

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Dynamic Strategy and Disruptive Innovation
Name of the Student:
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Author Note:

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Executive Summary:
The report aims at providing an overview of Facebook in context of its mission and vision with r
respect to recent developments, challenges and the industry trends. The report also puts across a
diagrammatic representation of the stakeholders of Face book thereby explaining and describing
the specific stakeholders. The report also puts across a stakeholder analysis for the four selected
group of stakeholders of Facebook based on the Swing, Offensive, Defensive, and Hold strategy
of shareholders.

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Table of Contents
A. Introduction to Facebook:...........................................................................................................3
B. Stakeholder View:.......................................................................................................................5
C. Stakeholder Analysis for Four Selected Stakeholder Groups.....................................................7
References:....................................................................................................................................10

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A. Introduction to Facebook:
Facebook is one of the largest and online social media networks across the world. The
company is headquartered in the Menlo Park, California and has been found by Mark
Zuckerberg (facebook.com 2019). The vision statement of the company guided the employees to
focus their efforts in supporting the corporate effectiveness for international business growth.
The mission statement however, identified the primary actions and aims for reaching the vision.
In other words, the mission statement of the company has always helped in determining the
tactics and strategies for developing and growing the firm.
However, Facebook has been facing various challenges in recent times. Some of these
challenges included (Gaus 2018):
Bad Headlines: The image of this social networking site has been tarnished by Russian
actors who tried to spread not only a divisive political message but also discourage voting. It has
been claimed that the messages have mostly tried to escape the scrutiny of Facebook and
appeared in its news feed.
Pressures of Monetization: With the decline in the key News feed of Facebook , the
social network site has constantly been under pressure for monetizing increasing number of
products. Facebook however planned to deal with it through expansion of larger variety of
content that would comprise of ads
Troubles of Governance: The constant negative reports regarding the social networking
site have forced the COO Sheryl Sandberg to step down and implemented greater checks on the
CEO Mark Zuckerberg who controlled majority of the shares of the company. There have also

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been reports mentioning that the change in management would act as positive catalyst for the
long term shareholder.
Reduced Trust in Technology: Although Facebook is able to rebuild some of the lost
credibility there have been instances that the appetite for the super addictive tech and the social
media follows a decreasing trend in the advanced economies. According to a report published by
Pew Research, it has been found that dependency on social media have reduced in the advanced
nations with technology giants like Apple rolled out tools for combating the tech addiction
thereby spending lesser amount of time on the apps. Thus it can be said that the business model
of Facebook which is dependent on hooking the attention of users might simply fall apart.
Given the challenges faced by the company, Mark Zuckerberg, realized that a new
corporate mission was necessary to drive the company towards success. The new corporate
mission has been “to give people the power to share and make the world
more open and connected.” This particular mission had been implemented amidst the
security and the data privacy issue faced by the company. The new mission portrayed that the
company primarily focused on making the social media platform a key part of the community
development. Based on the new mission the key components of Facebook include (Chaykowski
2019):
 Empowering the people
 Enabling building of community
 Developing connections with the world.
The first component of the mission statement which is ‘empowering the people’
signifies that the company has the goal of ensuring the online networking service as the means of

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Facebook
Advertisers
Users
Employees
Government
Communities
making the users increasingly capable online. The corporate mission also portrayed that the
capability lay in form of the community building. For instance, people might use social network
for facilitating the information and communication sharing amongst the community members`
These communities mostly includes the foundations, neighborhoods, virtual communities and
communities with shared interest. Besides, the mission statement also indicates that the social
networking site posses the objective of creating a connection across the world. Here, it should be
noted that connections gets mostly created when the users communicates through social media
website and the subsequent mobile apps. In other words, the new mission of the company
enables the business in getting connected to the customer.
B. Stakeholder View:
The stakeholders view of Facebook using stakeholder view model are as follows:

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Figure 1: Stakeholder View Model of Facebook
Source: Created By Author
As far as the users are concerned, Facebook has closer to 1.6 million monthly users
thereby making them one of the largest online social media platforms (Saxton and Waters 2014).
The users are considered one of the key stakeholders in determining popularity of the Facebook
and displaying awareness regarding the advertising service.
Advertisers however represent the second most vital stakeholder since they are key
sources of income for the Facebook. Here, the interest of the stakeholder includes sufficient user
base, effective advertising service and suitable data from Facebook (Bechmann 2013). This
social media platform puts across variety of options for the advertisers thereby enabling in
targeting specific audience on social media network for maximizing benefits of advertising cost
endured by advertisers on using such service. It can thus be said that Facebook address the
interest of stakeholders.
Facebook has about 1.6
billion ac ve monthly
users, making them the
biggest online

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social media service
(Kissinger). The users are
the most important
stakeholder because they
determine the popularity
of Facebook and a,rac
veness of its display
adver sing service.
Facebook has about 1.6
billion ac ve monthly
users, making them the
biggest online
social media service
(Kissinger). The users are

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the most important
stakeholder because they
determine the popularity
of Facebook and a,rac
veness of its display
adver sing service.
Employees refer to the third key stakeholder since they remain responsible for the
creation, management and improvement of the company’s service to the advertisers and the users
(Haigh, Brubaker and Whiteside 2013). The interest of employees primarily comprises of the
work environment, culture, career development and compensation. They are also one of the vital
stakeholders since in absence of the employees might hurt the development and improvement of
the service to the advertisers and the users.
The government refers to the fourth key stakeholder since they impose laws, regulations
and rules on the social media business of Facebook (Haro-de-Rosario, Sáez-Martín and del
Carmen Caba-Pérez 2018). They help in keeping the company regulated with the imposition of
regulations and the government policies. The corporate social responsibility of Facebook
includes partnering and negotiating with the governments thereby showing support for the
governmental efforts and programs.
Communities represented stakeholders influence the company primarily through
affecting the perceptions of the advertisers and the users ( Hassan and Casaló Ariño 2016).

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C. Stakeholder Analysis for Four Selected Stakeholder Groups
Depending on type of stakeholders the four key strategies put forward by Freeman are
swing strategy, offensive strategy, defensive and the hold strategy. In this section, the behavior
of four stakeholders of Facebook are analyzed based the four strategies.
Swing Strategy: This category of the stakeholders is either able to assist or hinder the
organizational capabilities. According to suggestions put forward by Freeman, Wicks and
Parmar (2004), those having higher threatening abilities and highly cooperative characteristics
have been referred as the Swing Stakeholders.
The Swing category of stakeholders for Facebook represents the employees who have the
power to assist the company by making contributions to the business of social media. They can
possess the ability of hindering the organizational abilities. These stakeholders remain significant
in impacting the evolution of the company through improving and developing products. The
interest of the employees includes career development and higher level of compensation. These
programs are however directly addressed by Face book through the competitive Human
Resource HR policies. For instance, the company gives away highest salaries for attracting talent
and also competes against some of the biggest firms like Google in labor market. These efforts
portrays that the company is able to satisfy the corporate social responsibilities in considering
interest of the employees as one of the key stakeholder. By addressing the concern of the
stakeholder group the corporate culture of Facebook is able to shape the behavior of the
employees.
Offensive Strategy: It is generally adopted when the group remains supportive. It helps
in changing the perceptions and objectives of the stakeholder thereby adopting the position of

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stakeholder or linking the program to the others such that the views of stakeholder becomes
increasingly favorable (Mitchell et al. 2015). Those stakeholders who remain highly supportive
are known as the offensive stakeholders.
The offensive category of stakeholders for Facebook represents the users. There are
billions of active monthly users of Facebook. These members or users of social media platform
represent the stakeholder group that is considered as the topmost priority by the company while
considering the mission and the vision statements of Facebook. Users are important since they
determine the attractiveness and popularity of company thereby displaying the advertising
service. The business however aims at continually growing the user base that is aligned with the
intensive growth strategy and the generic competitive strategy for Facebook. As stakeholders,
users remain interested in using the social media services of the firm and in ensuring the security
and privacy concerns. Facebook continue in improving the mobile apps and its social networking
platform thereby making it easier for protecting the privacy. The company has also been one of
the key participants in launch of the Internet.org in the year 2013 thereby making the other
online resources and the company’s platform increasingly accessible to developing world. Thus,
the company tries in satisfying the primary interest of the members and the users.
Defensive Strategy: This is adopted when the group remains non supportive. The
objective lies in preventing the competitive threat on part of the shareholders (Sobczak and
Havard 2015). This implies reinforcing the present beliefs of the firm thereby maintaining the
existing programs or letting stakeholder drive the process of integration. Thus, stakeholders with
non-supportive characteristics are known as the defensive stakeholders.

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The defensive category of stakeholders for Facebook represents the Governments. They
ensure imposing requirements on the business of social media. Such influence helps in keeping
the company compliant with the government interest and policies which also involves the
regulatory requirements. The strategy related to corporate social responsibility of Facebook
shows support for the programs and efforts of the government by getting involved in partnerships
and negotiations.
Hold Strategies: They are adopted by the group that is marginal. Hence, the company
should hold the present position and carry on with the present strategic program (Yang, Wang
and Jin 2014). Those possessing not so important characteristics within a firm are known as hold
stakeholders.
The hold category of stakeholders for Facebook represents the communities. These
stakeholders help in bringing about an impact in perception of the users and the advertisers and
given least priority as the stakeholder group.

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References:
Bechmann, A., 2013. Internet profiling: The economy of data intraoperability on Facebook and
Google. MedieKultur: Journal of media and communication research, 29(55), pp.19
Chaykowski, K, 2019.Mark Zuckerberg Gives Facebook A New Mission. [online]. Available at
https://www.forbes.com/14815098 [accessed Aug 12, 2019]
facebook.com , 2019. [onlibe]. Available at
https://www.facebook.com/business/help/461775097570076 [accessed Aug 12, 2019]
Freeman, R.E., Wicks, A.C. and Parmar, B., 2004. Stakeholder theory and “the corporate
objective revisited”. Organization science, 15(3), pp.364-369.
Gaus, A, 2018. 4 Key Challenges Facing Facebook in 2019. [online]. Available at
https://www.thestreet.com/technology/4-key-challenges-facing-facebook-in-2019-14815098
[accessed Aug 12, 2019]
Haigh, M.M., Brubaker, P. and Whiteside, E., 2013. Facebook: examining the information
presented and its impact on stakeholders. Corporate Communications: An International
Journal, 18(1), pp.52-69.
Haro-de-Rosario, A., Sáez-Martín, A. and del Carmen Caba-Pérez, M., 2018. Using social media
to enhance citizen engagement with local government: Twitter or Facebook?. New Media &
Society, 20(1), pp.29-49.

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Hassan, M. and Casaló Ariño, L.V., 2016. Consumer devotion to a different height: How
consumers are defending the brand within Facebook brand communities. Internet
Research, 26(4), pp.963-981.
Mitchell, R.K., Van Buren III, H.J., Greenwood, M. and Freeman, R.E., 2015. Stakeholder
inclusion and accounting for stakeholders. Journal of Management Studies, 52(7), pp.851-877.
Saxton, G.D. and Waters, R.D., 2014. What do stakeholders like on Facebook? Examining
public reactions to nonprofit organizations’ informational, promotional, and community-building
messages. Journal of Public Relations Research, 26(3), pp.280-299.
Sobczak, A. and Havard, C., 2015. Stakeholders’ influence on french unions’ CSR
strategies. Journal of Business Ethics, 129(2), pp.311-324.
Yang, R.J., Wang, Y. and Jin, X.H., 2014. Stakeholders' attributes, behaviors, and decision-
making strategies in construction projects: importance and correlations in practice. Project
Management Journal, 45(3), pp.74-90.