Report on Stakeholder Influence on Tesco's Business Practices

This report examines the influence of both internal and external stakeholders on business practices, using Tesco as a case study. It defines stakeholders, differentiating between internal (shareholders, managers, employees) and external (customers, suppliers, government) entities, and analyzes their respective impacts on Tesco's operations. The report highlights how stakeholder decisions and actions, such as shareholder funding, management decisions, employee morale, customer feedback, supplier quality, and government regulations, directly or indirectly affect Tesco's business practices and profitability. It concludes that maintaining strong relationships with all stakeholders is crucial for long-term success and emphasizes the importance of adapting to economic conditions to meet stakeholder needs and enhance organizational productivity. Desklib offers a platform for students to access similar solved assignments and study tools.

Influence of Stakeholders on
Business Practices

Table of Contents
Introduction......................................................................................................................................3
Stakeholders : .............................................................................................................................3
Analysing the relation of internal and external stakeholder with business:................................3
Conclusion.......................................................................................................................................5
References:.......................................................................................................................................6

Introduction
This report focuses on the impact of external and internal stakeholders on business
practices. Internal stakeholders are the ones who are directly involved in the operations of the
business concern. Whereas, external stakeholders are the ones who are indirectly impacting the
business operations. Both of them gets affected with each other decisions. All the stakeholders
impact on the business operations some has major impact well some has minor. In this report,
Tesco is considered to check its stakeholders impact on its operations. It is a British groceries
and merchandise retailer headquarter in Welwyn Garden City, England. Moreover, they offer
variety of goods ranging from clothing, electronics, furniture, petrol, financial services and so on.
Stakeholders :
They are individual or group who have interest in company, business or organisation. They are
two type of stakeholders internal and external. Internal are the ones who works as a part of
business such as owners, managers , employees and so on. They participate in the coordination,
funding, resourcing of business operations and impacts directly the profit generating capacity of
the concern. Whereas, external stakeholders are the ones outside the business but affects the
business decisions and actions. External stakeholders are customers, government, suppliers and
others. They are engaged in contributing views and experiences of them which indirectly impacts
the business concern.(Bruna and Nicolò, 2020)
Analysing the relation of internal and external stakeholder with business:
It becomes crucial for the business concern to keep awareness of its stakeholders. The
activities of the organisation will impact stakeholders decision. In the same way, stakeholders
decision will impact the decision that business makes. (Brulhart, Gherra, and Quelin, 2019) So,
in this Tesco is considered for monitoring the relation of internal and external stakeholders on
business practices.
 Shareholder: They are known as the owners of the business concern due to which they
have major impact on activities of business. They are the owners who makes all

important decisions of the concern and provide business required funds to carry its
operations. Therefore, their decisions with regards to business will directly impact the
operations.
 Managers : They are internal stakeholders of the company, who actively takes all relevant
decisions and take responsibility of workforce working under them. They are responsible
to manage all the departments and workforce working under them. Along with this, they
are responsible for setting the targets and accomplishing them. Therefore, management
decisions will directly impact the business practices positively or negatively.
 Employees : They are also internal to business but have limited influence on business
practices. However, they impact the operations directly as well for instance, by doing
strike, or resisting to accept any changes. In relation to this, Tesco uses various
motivational techniques such as fair compensation, proper training and empowerment
helps to boost their morale to work. Besides this, fulfilling their all needs such as self
esteem needs, security, social and others will make them feel like part of organisation and
it will also improve their productivity which would ultimately led to more profits for
business concern.(Vitolla and et.al., 2019)
 Customers : they are external to business and indirectly impacts the organisation concern.
In addition to this, Customers purchase the products and services and gives feedback
about them. They want good quality products at reasonable prices This indirectly impacts
the business for instance, if consumers are delighted after using the product, they will
spread positive word of mouth and in case if they are dissatisfied with the product or
service, they will warn others from using products and services. So, customer opinions
will positively or negatively impact the business practices.
 Suppliers : They are the ones who supply material to the companies for carrying out the
operations. They directly impact business operations because in case, if there are any
changes in the quality of raw material supplied by them or their delivery pattern. All of

these will directly impact business practices. For instance,if company wants to switch its
supplier due to any reason it will affect them positively or negatively.
 Government : They regularly passes new laws, rules and regulations in conducting
business operations.(Msosa, 2019)For instance, by providing grants or funds and others.
These practices have direct influence on the operations of business concern. Moreover,
government wants businesses to pay taxes that support government services such as
education, police and other protection. So to carry out all these activities government
need funds which need from these organisations.
So, it becomes important to maintain strong relations with stakeholders to have long term profits
and successes. It becomes essential to maintain healthy relations with society to operate their
business for long term. A company who seeks to build positive relation with wide range of
internal and external stakeholders deliver high profits and build trust and faith among them. So,
businesses keep on checking all internal and external factors to make changes as per economic
situation in order to increase productivity of company.
Conclusion
With respect to above report, it is concluded all stakeholders have major or minor impact
on the business operations. All the decisions of the business will impact the stakeholders thought
process. In the same way internal and external stakeholder will directly or indirectly impact the
business concern. So, businesses have to maintain their standards in each and every respect in
order to boosts up the profits of organisation. Therefore, managing these activities well will help
an organisation to grow and fulfil needs of all internal and external stakeholders. This will satisfy
both the parties along with managing the productivity of the concern.

References:
Books and Journals:
Bruna, M.G. and Nicolò, D., 2020. Corporate reputation and social sustainability in the early
stages of start-ups: A theoretical model to match stakeholders' expectations through
corporate social commitment. Finance Research Letters, 35, p.101508.
Vitolla, F. and et.al., 2019. The impact of national culture on integrated reporting quality. A
stakeholder theory approach. Business Strategy and the Environment, 28(8), pp.1558-
1571.
Msosa, S.K., 2019. CSR Implementation Challenges: Analysing the Role and Behaviour of
Stakeholders. In Opportunities and Pitfalls of Corporate Social Responsibility (pp. 15-
34). Springer, Cham.
Brulhart, F., Gherra, S. and Quelin, B.V., 2019. Do stakeholder orientation and environmental
proactivity impact firm profitability?. Journal of Business Ethics, 158(1), pp.25-46.