What Effect Do Business Decisions Have On Stakeholders?

Unit 1 Topic 1.5.5

Must learn: what is meant by a stakeholder

Should learn: why stakeholders are important to a business

Could learn: how business decision can affect stakeholders

http://www.tes.co.uk/teaching-resource/Who-are-stakeholders-6173961/

Anyone who has an interest (or stake) in a business

THINK! For Hodge Hill School, who are the stakeholders?

(not steak-holders!))

Shareholders Managers

Employees

Customers

Suppliers

Local community

vs

Shareholders Managersvs

Shareholders

What should happen to the profits?

Managers

What should happen to the profits?

vs

Shareholders

Want the profits to be paid out in dividends

Managers

Want the profits re-invested in the

business

vs

Shareholders & Managers

Employeesvs

Shareholders & Managers

Want loyal, reliable and cheap workers

Employees

Want job security and high pay

vs

Shareholders & Managers

Customersvs

Shareholders & Managers

Want customers prepared to pay

high prices

Customers

Want quality at low prices

vs

Shareholders & Managers

Suppliersvs

Shareholders & Managers

Want suppliers who can

deliver quality stock on

time and want to be able to pay on credit

Suppliers

Want to be paid promptly to help their cash flow

vs

Shareholders & Managers

Want to be able to run

the business with little

interference

Local community

Want a company which respects the wishes of the local community and sponsors local events

vs

Keith owns a white goods repair company, fixing dishwashers, washing machines and other household goods. Keith employs 2 skilled workers who also go to customers houses and fixes appliances on-site.

Keith has a business loan with NatWest bank and he is currently repaying them £300 per month.

Keith’s main supplier is Argon Appliances who are his main provider for spare parts and replacement machines.

Create a presentation that shows the stakeholders forKeith and the effects of the following business decisionshe has recently made:

1. Increased annual salary of all employees by 5%2. Has sourced replacement washing machines from

B&Q as it is cheaper than buying from Argon supplies.

3. Allow emergency call out for all customers both evenings and weekends

4. Increased call out charges by 12% in emergencies5. To buy a new premises in the town centre so he can

complete repairs on appliances and store more stock.

For each decision say: Who is affected? How that decision might affect them? Is there are conflict of interest?

Create a mind map of all of the stakeholders for the BT group. For each stakeholder, investigate how BT are trying to meet their needs.

(5 Marks)