Company is Not Managing Good Relationship With Stakeholders 2

8/7/2019 Company is Not Managing Good Relationship With Stakeholders 2

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yPresented to,

Sir Suhail Nazar

& class felows



Groups member¶s are:

Names Roll#

Hafiz M Abdullah 07

Imtiaz Hussain 14

M.Arshad 11

Kamran Mukhtiar 17



Your Company needs to betterDefine and Monitor its Competitors



Signs

Your Company over focuses on itsnear Competitors and misses distantcompetitors and disruptive

technologies.Your Company lacks a system for

gathering and distributingcompetitive intelligence.



You are focusing on WrongCompetitor

Companies usually find it easy toname their competitors.

McDonalds would name Pizza Hut, and

Burger King etc They should include super markets that sell

prepared foods.



Company lacks a system forgathering competitive intelligence

Competitive intelligence meansemploying persons who have goodknowledge and experience of

competing against them. There should be a good competitive

intelligence system.





LOGO

Why organizations fail tomanage thestakeholders.



What is a stakeholder?

It can be defined as:

³ A person, a group or a system which affects

and can be affected by an organization¶s

action´Stakeholders are the specific people

or groups who have a stake in theoutcomes of the organization¶s

actions



Types of stakeholders

Internal stakeholders Business owners

Employees

Managers, etc

External stakeholders They do not own or work with the business yet they

have an influence and interest in the business. Theyinclude

� Pressure groups� Associations and organizations like, press/media,

government, local communities etc.





Why organizations fail to manageits stakeholders

The reasons why companies fail dueto improper management of itsstakeholders include

1. Unhappy employees

2. Selection of the 2nd grade suppliers

3. Not dealing with distributors in an effectivemanner.

4. Unhappy dealers5. unsatisfied investors



Unhappy employees

Ask any supervisor or manager what theyconsider to be their toughest challenge onthe job and, eventually, they will tell you it'sa disgruntled or unhappy employee.

A disgruntled employee can sabotage acompany.



The signs of unhappy employees include High employee turnover

Frequent failure to carry out policies

Fraud

Theft

Absenteeism

And in worst cases, violence as well.

The workplace is a complex socialnetwork



Why employees get unhappy

The workplace is a complex socialnetwork

Although employees do promise tolove, honor and obey their employer,

conflict no doubt will arise eventually;people are born to disagree.Now it is upon the organization to

whether look upon the conflict of opinion by a staff member as adisobedience or as a healthy activity.

The method of dealing with theconflict decides whether a companywill have unhappy employees or not.



Second rate Suppliers

Suppliers are an important stakeholder for the business.

Suppliers differ greatly in their capacity to deliverproducts and services.

An organization needs a quality supplier to deliver the best

quality to the customers and to achieve value. But sometimes the best quality supplier is already

occupied. Reason??



R eason«

The reason behind the pre-occupation of the best suppliercould be anything like The supplier is already working at its full capacity, and cannot take

another customer.

The supplier is only limited serving only one organization in an

industry. As a result your company is bound to hire the 2nd best

supplier in the market.

There is one more reason why organizations hire 2nd bestsupplier, that is lowering of purchasing cost.

But in both the cases the organization bear some additionalcosts and higher cost in dealing with those low qualitysuppliers and loss of customer due to reduced quality isanother negative.



Ineffective distributors¶ management

Often looked on as middlemen that add costs to materialpurchases, distributors are, in fact, a vital link in the anybusiness, bringing tangible benefits to both materialsuppliers -- those manufacturing the materials -- and end-users

But the problem here is that a distributor carrycompetitors products as well. But companies usuallyexpect them to give priority to their product, but thissimply isn¶t the case all the time.



Cont¶d

Here the problem with the companies is thatthey don¶t take distributor¶s point of viewinto consideration.

A company should make rewarding terms

with the distributor, they must feel that theygain as much or above benefit from sellingyour products, as selling of yourcompetitors¶.



Investors are not satisfied.

Investor satisfaction is the mostimportant thing for your business,because they provide funds for thesurvival of business.

Investors are interested in highprofits, higher ROI etc.

Investors¶ satisfaction is revealed bythe fact that how long would theykeep their funds in your business.

Signs of investors dissatisfactioninclude Low profits Low share prices High cost of capital.



Over view



LOGO

Solutions to all theseproblems



Move from zero-sum thinking to

positive-sum thinking.

In earlier times, the thinking of businessmen was that thebusiness size is fixed, so to get the maximum share out of profit, he must give least to other partners i.e. employees,suppliers etc. that¶s zero sum thinking.

Today the times have changed and there is a growing

evidence that the way you treat your stakeholders has adirect impact on the outcome of your business.

For example:

Many companies provide discount,

commission to their distributer and employees.

Uniliver Banks offer bonuses on good performance.



Manage employees better

Employees work well, when they are well chosen,well trained, well motivated and well respected.

This thing doesn¶t happen in an inflexibleorganization, where a firm

hires people No training is given

No participation in decision making

Frequently criticize their work.

These are the sort of organizations

who create unhappy employees.



Solution«..

Employees should not be hired until senior managementhas clearly defined the company¶s values, vision, mission,target customers etc.

Once these things are clearly defined then the companycan search for the right people for the job, train and

empower them. People chosen by this method will be able to live

company¶s values.

work at their best.

For example:P.I.A



Manage supplier relations better.

In old times, companies used to have a bunch of suppliers for the same thing, like

Giving 60% business to one supplier

30% to other

10% to another

The only reason behind this was to have all the supplierscompeting for company¶s business, reducing thepurchasing costs.

This technique sure drives the

purchasing cost down but

on the expense of quality.



Cont¶d

Trend is moving towards, only one excellent,specialized supplier for each category of yourbusiness.

For example: A

uto industry. Dell

By doing this, the relation between the companyand supplier grows stronger and it leads to Better quality

Better productivity Innovativeness

Reduced costs



Manage distributors better.

The quality of the distributor makes a great difference inyour ability to satisfy the end-users.

So for that very reason, your company should attract the

best distributors (wholesalers, dealers etc)

The key here is to get the distributor to place a high valueon their relationship with you and as a result, put outspecial efforts on your behalf.



Caterpillar example

They believe that Local dealers are well established members of their

societies, so they can get much closer to the customers thana global company can on its own.

But to get them working at their full potential, a companyshould form very close ties with them by integrating theminto its critical business systems.

When treated this way dealers serve as sources of marketinformation, as consultants and as problem solvers.

They claim that dealers can be much more than amere channel to the customers.



Cont¶d

Beside hiring the best distributor, a company mustmaintain a continuous learning relationship withits distributors.

Companies should setup extranets.

These extranets could serve many purpose likeinforming the distributors about

New ideas and developments

Facilitating the ordering, delivery and payment cycles.



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Company is Not Managing Good Relationship With Stakeholders 2