Instrumental stakeholder theory proposes a positive relationship between fairness toward stakeholders and performance while some firms focus on addressing stakeholders based on bargaining power rather than fairness (Bridoux & Stoelhorst, 2014). In Non-for Profit organizations, the goal is to establish an equity based system with the stakeholders, which in many cases is synonymous with volunteers make up the critical infrastructure of the organization. With non-profit organizations, bargaining power is the primary driver to determine if the voice of the stakeholder will be is to be heard.
A discussion of how stakeholder interests, opinions, and concerns are managed in non-profit organizations.
Non-Profit organization utilizes a dynamic
…show more content…
If the stakeholder’s voice is ignored, this can lead to disruptive behaviors, which will have a negative effect on the organization. In a for-profit organization, bargaining power is the guiding force at determining how and if a stakeholder’s interest, opinions, and concerns will be addressed. A for-profit organization will base its level of involvement with its stakeholder based on the degree of their salience (Bundy, Shrosphire, and Buchholtz, 2013). The organization will break each stakeholder down into eight categories (Dormant, Discretionary, Demanding, Dominant, Dangerous, Dependent, Definitive, and Non-Stakeholder) and based on the category they fall in, allocate their time (Mitchell, Agle, and Wood, 1999). Based on the categories the stakeholder falls in, the organization will determine what they deem is the appropriate level of engagement to address the stakeholder’s interest, opinions, and …show more content…
In a non-profit organization, the fairness approach is utilized to address stakeholder’s interest, opinions, and concerns. In a for-profit organization, bargaining power is the primary tool to determine how the organization will respond to the interest, opinions, and concerns of the stakeholder. In both a non-profit and for-profit organization, it is important to understand the stakeholders and their degree of salience. The program/project management plan is one tool in which to identify the stakeholders, the salience category they fall into, and their
Worth, M. (2014). Nonprofit management: Principles and Practice. 3rd Ed. Thousand Oaks, CA: SAGE Publications, Inc.
Worth, M. (2014). Nonprofit management: Principles and Practice. 3rd Ed. Thousand Oaks, CA: SAGE Publications, Inc.
The nonprofit sector in America is a reflection some of the foundational values that brought our nation into existence. Fundamentals, such as the idea that people can govern themselves and the belief that people should have the opportunity to make a difference by joining a like-minded group, have made America and its nonprofit sector what it is today. The American "civil society" is one that has been produced through generations of experiments with government policy, nonprofit organizations, private partnerships, and individuals who have asserted ideas and values. The future of the nonprofit sector will continue to be experimental in many ways. However, the increase of professional studies in nonprofit management and the greater expectation of its role in society is causing executives to look to more scientific methods of management.
Non-Profit organizations are a major mold in society in general, and they continue to help advance many of the social causes of our time. From the description, we know that employee and volunteer morale is quite low, and that is the fault of the senior management. In an organization, it is important that each individual knows that they are contributing to something larger than themselves. In many cases, employees seek to work somewhere where they can earn a living, but also where they can become a member of a team, and feel a sense of purpose. When they are not treated with respect or given the ability to make their own decisions, they lose engagement and become stagnant in their work. Volunteers look for much of the same thing; they are, after
Throughout this course my paradigms of what a nonprofit organization have been challenged as we have considered the major aspects and leadership challenges of these organizations. Having worked with for profit and nonprofit organizations in the past I was quite confident that I had a clear understanding of the distinctions between the two. I had worked in organizations that regularly used volunteers to accomplish their mission and felt that the management of these processes were simplistic. Despite these misconceptions, I found that I was able to learn a tremendous amount through our reading, peer interactions, group projects and equally important, my volunteer service as part of this course.
Clara Barton founded the American Red Cross after becoming involved in the work of the International Red Cross during the Franco-Prussian War. Her heart of giving and helping others convinced her that an American chapter was needed in her country in 1881. The ARC is a humanitarian organization that is dependent on the contributions of time, blood, and money from the American public to support its multiple lifesaving services and programs. The ARC’s mission is to prevent and alleviate human suffering in the face of emergencies by mobilizing the power of volunteers and the generosity of donors. The ARC from its humble beginnings and up to recently has provided great support the American public and military during times of need. However, recently the organization has drifted from is stakeholders and gone through difficult challenges. Instead of the focus being on the disaster victims, the American public and government has been on the mismanagement of the organization. The media and general public have been critical of their slow response to disasters, their inability to wisely manage donated funds and blood, its poor planning and communications with disaster victims and other agencies during relief efforts. This paper is based on the case study of the American Red Cross and will discuss the impact of the events from the case study on ARC’s “benefits of business ethics”, discuss the role that ARC’s stakeholder orientation played in this scenario, discuss the ways in which ARC’s corporate governance failed to provide formalized responsibility to their stakeholders, and recommend steps that ARC could follow to improve their stakeholders perspective.
Within my organization there are many different stakeholders. It is crucial to first understand what a stakeholder means. A stakeholder is a person who has something to gain or lose through the outcome of planning process. Within healthcare there are three types of stakeholders, those who receive health care, those who give health care, and those who manage the financial aspects of health care. Health care organizations do not face just one or a few stakeholders they hold many. Healthcare executives must learn to manage a portfolio of stakeholder relationships.
Worth, M. J. (2011). Nonprofit management: Principles and practice. (2nd ed.). Thousand Oaks, CA: Sage Publications.
Hence, the stakeholders which are described as those who are affected by the organisation performance ,actions and duties and those actions includes employees, clients, local community and investors as well. The theory of stakeholders also suggests that it is the responsibility of firm to make sure no rights of stakeholders are dishonoured and make decisions in the interest of stakeholders which is also the purpose of stakeholder theory to make more profit and balancing it while considering its stakeholders (Freeman 2008 pp. 162-165). In the other words organisation must also operates in a more socially accountable approach by carrying out corporate social responsibility as (CSR) activities.
Worth, Michael J. Nonprofit Management: Principles and Practice. 3rd Ed. Copyright 2014 by SAGE Publications, Inc.
Sometimes, the stakeholders of the projects have their own personal objectives which become a hindrance in carrying out the project successfully.
Stakeholders are individuals, groups, and organisations with the power to influence the delivery of an organisation’s strategy and thus the organisation’s performance and/or a significant interest in an organisation’s strategy and thus the organisation’s performance (Wisniewski, 2001; Ackermann & Eden, 2011). In the context of the draft BSC to be developed, however, the analysis shall focus on relatively aggregated stakeholder groups. Firstly, the aim of this stakeholder analysis is not to pinpoint individual persons as stakeholders who may then be managed more easily than large organisations, but to identify rather broad stakeholder groups interested in Zara’s performance. Secondly, addressing
Stakeholders are those groups or individual in society that have a direct interest in the performance and activities of business. The main stakeholders are employees, shareholders, customers, suppliers, financiers and the local community. Stakeholders may not hold any formal authority over the organization, but theorists such as Professor Charles Handy believe that a firm’s best long-term interests are served by paying close attention to the needs of each of these stakeholders. The modern view is that a firm has responsibilities to all its stakeholders i.e. everyone with a legitimate interest in the company. These include shareholders, competitors, government, employees, directors, distributors, customers, sub-contractors, pressure groups and local community. Although a company’s directors owes a legal duty to the shareholders, they also have moral responsibilities to other stakeholder group’s objectives in their entirely. As a firm can’t meet all stakeholders’ objectives in their entirety, they have to compromise. A company should try to serve the needs of these groups or individuals, but whilst some needs are common, other needs conflict. By the development of this second runway, the public and stakeholders are affected in one or other way and it can be positive and negative.
Stakeholders are interest of an individual or groups that directly or indirectly affected by the organisation’s activities, policies and objectives (Henry Frechette, 2010). Stakeholders can be divided as internal (managers and employees) and external (shareholders, customers, and suppliers) (BPP F9). Different stakeholders may have common interests or conflict interests with company. Company board members or management must take care about stakeholders’ interest. They can’t make the decision based on their own interest or their relation with others organisation. Conflict of interest will arise when interests of organisation act in concert with managers’ personal interests or interests of another person or organisations, (Anon, no date).
Business organizations regularly run into demands from various stakeholders groups when conducting day-to-day business. These demands are generated from employees, customers, suppliers, community groups, governments, and shareholders. Thus, according to Goodpaster, any person or group of people that can shape or can be shaped by attainment of the objectives by an organization is considered a stakeholder. Most business organizations recognize and understand their responsibilities to these groups and endeavor to honor and fulfill them. These responsibilities are often communicated to the public by a statement of principles or beliefs. For many business organizations, corporate social responsibility (CSR) has become an essential and integral part of their business. Thus, this paper discusses the two CSR views: the classical view and the stakeholder view. Furthermore, I believe that the stakeholder view has brought ethical concerns to the forefront of businesses, and an argument shall be made that businesses would improve both socially and economically if CSR, guided by God’s love, was integrated into their strategic planning.