Understanding key stakeholders

Accounting Ahead | Original study resource | accountingahead.com.au

Understanding key stakeholders

MODULE 3 | 3.1 | STUDENT COMPANION

Internal analysis looks at the factors within the organisation's control: stakeholders, current performance

(judged through three groups of drivers), resources and capabilities, and finally SWOT and gap analysis.

The CPA collects, checks and analyses the financial and operational data behind it, and acts as the bridge

between data and business intelligence.

Four steps of stakeholder analysis

1. Identify

Who are the stakeholders,

and what does each one

need?

2. Assess

alignment

Do their needs fit with

each other and with the

strategy?

3. Assess power

Plot power against

interest on the grid

4. Choose

techniques

Partner, manage, consult

or inform

Stakeholder maps are snapshots: positions can change quickly

Who are the stakeholders, and what do they need?

Saltbush Energy

Imagined wind farm in regional New

South Wales

Shareholders

A good return on a large investment

Lenders

Loans repaid on time

Host landholders

Reliable lease income

Neighbours

Noise, the view and property values

Local community

Jobs and spending in town

Government and planners

Rules met; energy targets reached

Environmental groups

Birds and bats protected

Supplier and buyers

A stable contract; dependable power

at a fair price

Remember: include the current leaders in the analysis. Leaders are not immune to self-interest, and some may

resist change that reduces their power, so assess their style and adaptability honestly.

GLOBAL STRATEGY AND LEADERSHIP | M3 | 3.1 | STUDENT COMPANION

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Accounting Ahead | Original study resource | accountingahead.com.au

The power-interest grid

Context setters

High power, low interest.

MANAGE: listen, address

concerns, keep channels open

Players

High power, high interest.

PARTNER closely: involve them

and genuinely listen

Crowd

Low power, low interest.

INFORM: keep them updated

Subjects

Low power, high interest.

CONSULT: engage them before

they band together

Low High

Interest in the strategy

High

Low

Power to

influence

Saltbush Energy (imagined)

Players

Board, chief executive, major shareholders,

lenders

Context setters

State planning authority, grid operator

Subjects

Neighbours, host landholders, environmental

groups, employees

Crowd

Electricity customers in the wider region

Four techniques for working with stakeholders

Group Technique What it looks like

Players Partner Involve them throughout; the chief executive briefs the board regularly

so it can govern without micromanaging

Context setters Manage Understand and follow their rules; consult early when problems arise;

keep channels open

Subjects Consult Ask for their views and respond; if ignored, they may band together and

gain power

Crowd Inform Keep them updated, even though they have little say

Case note: the OpenAI board crisis, November 2023

On 17 November 2023 OpenAI's board removed chief executive Sam Altman. Within three days, more than 700

of its roughly 770 employees signed a letter threatening to leave unless the board resigned and Altman returned,

and Microsoft, which had committed about US$13 billion to OpenAI, offered them all jobs. Within a week OpenAI

agreed to bring Altman back, under a new board that kept only one of the directors who had removed him.

Employees, usually subjects with high interest but little individual power, banded together and became players.

Sources: NBC News and AP, 17 November 2023; Al Jazeera, 20 November 2023; Reuters, 22 November 2023.

GLOBAL STRATEGY AND LEADERSHIP | M3 | 3.1 | STUDENT COMPANION

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Accounting Ahead | Original study resource | accountingahead.com.au

Practice questions

MODULE 3 | 3.1 | TRY THESE BEFORE THE WORKED ANSWERS

Question 1 - Stakeholders and their needs

Imagine Harbour City Aquarium, a public aquarium owned by a city council and run as a not-for-profit.

Describe what each stakeholder group needs.

Stakeholder What do they need from the aquarium?

Visitors and families

Schools

The city council that owns it

Staff and volunteers

Marine scientists

Animal welfare groups

Local businesses nearby

Sponsors and donors

GLOBAL STRATEGY AND LEADERSHIP | M3 | 3.1 | STUDENT COMPANION

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Accounting Ahead | Original study resource | accountingahead.com.au

Question 2 - Place them on the grid

Imagine two regional hospitals, Riverbend and Eastvale, planning to merge into one health service, with some

specialist services moving from the smaller town to the larger one.

Stakeholder Quadrant and technique

The two hospital boards

The state health department

Senior surgeons

Nurses and their union

Patients in the smaller town

Local councils

Suppliers of medical consumables

The general public

Question 3 - Conflicts in an automation plan

Imagine Goldleaf Foods, a family-owned biscuit maker with 220 staff in a country town. The family shareholders

want to automate the packing line, cutting 40 jobs and raising margins. Identify the conflicts between stakeholder

needs that this plan creates, and suggest how leaders could manage them.

GLOBAL STRATEGY AND LEADERSHIP | M3 | 3.1 | STUDENT COMPANION

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Accounting Ahead | Original study resource | accountingahead.com.au

Worked answers

MODULE 3 | 3.1 | WORKED ANSWERS - ATTEMPT THE QUESTIONS FIRST

Question 1 - Harbour City Aquarium

Stakeholder Needs

Visitors and families An enjoyable, educational visit at a fair price; safety and accessibility

Schools Curriculum-linked programs, safe group visits, affordable excursion prices

City council (owner) A well-run, financially sustainable attraction that brings visitors and pride to the

city

Staff and volunteers Fair pay or recognition, safe work, meaningful roles, development

Marine scientists Research partnerships, access to animals and data, ethical care

Animal welfare groups High welfare standards, transparency, conservation focus

Local businesses Steady visitor numbers that bring trade to nearby cafes and shops

Sponsors and donors Visible impact, good governance and recognition

Question 2 - Riverbend and Eastvale

Stakeholder Answer

Hospital boards Players: partner closely

State health department Context setter (or player, as funder): manage closely and consult early

Senior surgeons Players: their skills are scarce; involve them in designing the new service

Nurses and union Subjects who can band together: consult early and genuinely

Patients in the smaller town Subjects: consult; explain transport and access plans

Local councils Context setters: manage; they can amplify community concern

Suppliers Crowd: inform about changes to ordering and delivery

General public Crowd: inform clearly and early

GLOBAL STRATEGY AND LEADERSHIP | M3 | 3.1 | WORKED ANSWERS

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Accounting Ahead | Original study resource | accountingahead.com.au

Question 3 - Goldleaf Foods

Shareholders versus employees: higher margins for the family against 40 lost jobs and anxiety among

remaining staff.

Employees versus the town: job losses reduce local spending; the community may see the company

differently.

Customers and quality: automation may improve consistency, but a disrupted changeover could hurt

supply.

How to manage it: consult staff early; offer redeployment, retraining for the new equipment and fair

redundancy terms; phase the change; explain the business case honestly; talk with the local council and

community; and track morale and quality during the transition.

GLOBAL STRATEGY AND LEADERSHIP | M3 | 3.1 | WORKED ANSWERS

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