Stakeholders Theory at Marstons PLC - Essay Example

Implementation of the Stakeholders theory at Marston’s PLC Implementation of the Stakeholders theory at Marston’s PLC Stakeholdersare an important part of any organization. They refer to the group of people or organizations who are interested at different levels within an organization. As such, their efforts and contributions impact significantly on the activities and the performances of the particular company. Therefore, their particular concern for the particular organization is thought t be important since they have a stake in the company. Similarly to the concern raised by Berry et. Al., (2009, p. 2-20), at Marston’s the stakeholders view has been applied as an option to this for the simple reason that it makes it clear that the firm contains material or moral concerns in relation to the relationships that it should have with other investors (Cragg 2002, p. 120). The typical stakeholders of a company can be appropriately divided into external and external stakeholders. At the Marston’s company the internal stakeholders include the employees who include the managers and the owners or the shareholders since they are the people who are essentially affected by the wages provided and the stability of jobs within the company (Effron, Gandossy & Goldsmith 2003, p. 145). The managers are able to increase the amount of money that they make in the event that they push for the success of the company hence their ability to receive large amounts of bonuses among other perks. On the other hand, they are bound to suffer from the poor performances by the company (Berman, Wicks, Kotha & Jones 1999, p. 500). There are also external stakeholders of the Marston’s company who include their customers, suppliers, as well as the government. Although they are not employed by the company in a direct way, their contribution and influence significantly affects the operations and performance of the company (Fidzgerald et al., 1991, p. 121-150). In relation to this, at times, even the competitors are considered to be among the company’s stakeholders since they have a status that is derived from their ability and capacity to create significant effect on the firm and the rest of its stakeholders (Miles 2012, p. 262). With this, it is clear that each corporation bears the major obligation to create a great financial value and increase the value for their stakeholders. In this sense, as indicated by Beckett & Jonker (2002, p. 36), they have a fiduciary duty to put the needs of their stakeholders first since they are highly considered as the owners of the company. At the same time, they still have a significant responsibility towards their customers (Donaldson & Preston 1995, p. 84). Stakeholder theory At Marston’s, a change is expected to occur in relation to the stakeholder theory. The stakeholder theory refers to a theory in management in an organization and the ethical considerations within a business that addresses the moral and values that are implemented within the management of the organization (Beauchamp & Bowie 2005, p. 67). With the implementation of this approach, it will be possible for the company to identify and model the different groups which include the stakeholders of the corporation. The managers will also be able to describe and recommend the various methods with which the management can use in relation to the interest that these groups have on the functions of the company. In particular, it places into concern the principle that relates to the people and activities that count most within the organization (Freeman 1984, 25-40). The stakeholder theory that is expected to be implemented as Marston’s is a form whereby the system is comprised of stakeholders who operate within the larger system that is comprised of the host community (Kaler 2003, p. 80). This is capable of providing the necessary legal item and market infrastructure that bring about the smooth conduct of the activities of the company (Donaldson & Preston 1995, p. 70). Marston has discovered that they need an economic strategy that is effective in the current economic times. In addition, they will need to have organic development in the business. As such, they have made the resolution to implement the stakeholder theory, which has been advanced and justified within different areas of management. It is in the way that it is descriptively accurate, a power instrument and a tool to provide normative validity of the business and company operations. Although these components are highly related, they are also distinct in several ways that will require different resources as well as frameworks that measure performance to determine different levels of success. Because of this, they have been shown to bear varied implications on the company. The implementation of a change on this strategy is important in the sense that the stakeholders are thought as the owners of the firm since by virtue that they own market and equity shares, they have great interest to maximize on these shares. This was determined after the realization that although a number of strategies were implemented, half of them failed owing to the fact that they did not focus on the interests and information that is held by the key stakeholders. It is also found to be of extreme significance since with it, the organization becomes more visible in an increasingly relevant way. This is in the sense that it holds an elevated level of liability to its stakeholders and the wider community as well. The company understands that the lack of accountability to stakeholders and the community often leads to failure, poor performance and disaster by the company. As such, a manager who fails to maximize the wealth of the shareholder fails to honor the property rights (Phillips 2003, p. 58). Thus, the main reason for the change in the strategy proposed is that it will ensure that the needs of all those who influence the positive activities of the company are met, while at the same time making sure that the highest level of success is achieved within the company. The three main stakeholders that will be focused on are the customers or the consumers who will be provided with convenient pub-restaurants that offer good value and quality services within an environment that is considered attractive (Harrison, Parmar & De Colle 2010, p. 123). This focus on newly built strategy is likely to result in an enhancement in the overall food sales. It will be an appropriate strategy since the governments are causing a huge amount of damage by imposing regulation on the pubs by imposing high rates of taxations. In addition, the strategy that is proposed and developed by Marston is also highly focused on the market, which is still largely composed of the consumers. The employees will also be considered in relation to their major contributions towards the success of the company. The other key stakeholders who will be put into consideration include the community who contribute in different ways to the activities of the company. This new strategy that will be applied at Marston’s is chiefly focused on the stakeholder view which is known to incorporate both the view that is based on resources as well as that which is based on the market in addition to the view that is based on the socio-political level. In this sense, there are particular resources and materials that will be needed by the company in order to implement this specific strategy (Friedman & Miles 2002, p. 1-21). The major resource required is the human resource that will need to work together for its implementations and contribute to the success of the organization (Greenwood & Cieri 2005, pp. 1-25).After evaluation and proper identification; these can be considered to be the unity of the managers and other stakeholders in the general sense. After implementation of these strategies, the performance measures can be applied in several ways. Most of the concerns that are addressed in performance measurement include a number of disciplines and related literature. The four major performance measures include management accounting, public finance, and modeling of production from the operational research and economics of production as well as the control of management (Budd 2004, p. 86-90). This enables the company to assess whether there is a significance increase in the amount of sales to ascertain whether the number of customers who have been satisfied by the change and implementation of the new approach has been affected in a positive way. With these, the company will be in a great position to assess the success strategies of the company (Mansell 2013, pp. 54-79). For instance, with the use of management accounting, the company can make use of the performance measurements frameworks provided for the private sector. This seeks to improve organizational performance in relation to its accountability by linking the strategy and performance of the performance of the numerous stakeholders within the organization. In addition, these frameworks have incorporated both the financial and the non financial measures that are related to the production function of the organization. Some of these include the strategic marketing and reporting technique or the SMART pyramid. The framework that is concerned with results and determinations can also be used (Blattberg 2004, p. 180). Most of these strategies will help in the evaluation of whether the new approach has been a success or not. This can be done through the assessment of growth in relation to sales. Besides this, other results such as the year to date will be an important evaluation tool since it will be able to show whether the results are consistent and encouraging within an environment that is considered to be current and appropriate (Alkhafaji 1989, p. 70-77). The major way through which the progress of the company with regard to the implementation of the project will be by gauging whether the objectives of the sustainable development have been met as well as the evaluation of the amount of return on capital and the level of power. It will also be easy to evaluate the progress through the assessment of the different growth areas that have been experienced within the market (Laplume, Karan & Reginald 2008, p. 1170). This will enable the managers at Marston to establish the success rate of the strategy as they will be in a position to ascertain whether their outperformance of other competitors within the market has declined in the beer market especially in relation to some of their famous products. In conclusion, the implementation of the stakeholder theory and approach within the Marston’s company bears a number of implications for the managers. There are greatly related to the three aspects that are associated with the theory. Chiefly, they act as the mutual support for the theory since they provide its normative base. However, their fundamental implication is based on the idea that they include some of the modern theories that include property rights, which as indicated by Friedman, justifies the need to increase the wealth of the stakeholders as much as possible. With these, the managers are bound to face a number of challenges that include economic pressures that may continue to present a number of constraints on the confidence of the consumers (Miles 2011, par. 1-8). In order for the managers to appropriately implement the stakeholders’ theory and avoid experiencing some of the failures that have been encountered by other managers before, they will need to put into account some of the factors that include the treatment of most of their projects as standard projects (Connelley & Tripodi 2012, 57). With this, they will need to be aware of the particularities of the projects so as to be able to manage them in the correct manner from the beginning. They will also need to properly clarify and communicate the organizational goals. In this respect all the parties and stakeholders should be made aware of the expected goals so as to increase their level of commitment towards the projects. It is important that the common goal is well defined to all and contradictory goals eliminated as much as possible (Mitchel, Agle & Wood 1997, p. 860). The other factor that is of crucial importance to managers when implementing the stakeholders theory is the ability to present and handle their self interest in the most efficient way. They should put into consideration that the other stakeholders always have varied agendas. All of them should be taken into account if the firm expects to gain full support and commitment in the course of its project fulfillment. Sensitivity towards local cultures can be achieved through the elimination of rigid cultures and the lack of display of superiority in terms of culture since they are expected to lead to the lack of motivation and support at the local sites. However, the major implications on the manager will include the assurance that customers are satisfied at all times, the excessive attention towards the management activities and ensuring that the available time is used in the most appropriate way (Friedman & Miles 2003, p. 58). Owing to its level of success in many corporations that are similar to the Marston’s, the stakeholder theory should be effectively applied as the appropriate alternative to the other available conceptions that can be used by different corporations. References Alkhafaji, A. F. 1989. A stakeholder approach to corporate governance: Managing in a dy namic environment. New York: Quorum Books. Beauchamp, T.L., & Bowie, N.E., 2004. Ethical theory and business studies. New Jersey: Prentice Hall. Beckett, R., & Jonker, J., 2002. Accountability 1000: A new social standard for building sustainability. Managerial auditing journal, Vol. 17 (1/2): pp. 36-42. Berman, S. L., Wicks, A., Kotha, S., & Jones, T. M., 1999. Does stakeholder orientation matter? The relationship between stakeholder management models and firm financial performance. Academy of Management Journal, 42(5), 488-506. Berry, A. J., Coad, A. F., Harris, E. P., Otley, D. T., & Stringer, C., 2009. Emerging themes in management control: A review of recent literature. The British Accounting Review, 41(1), 2-20. Blattberg, Charles, 2004. "Welfare: Towards the Patriotic Corporation". From Pluralist to Patriotic Politics: Putting Practice First. New York: Oxford University Press. pp. 172 184. Budd, J.W., 2004. Employment with a human face: balancing efficiency, equity, and voice. Ithaca: ILR press and imprint of Cornell University Press. Connelley & Tripodi,2012. Aspects of leadership, Ethics, law and Spirituality, Marines Corps University Press, pp. 39-59. Cragg, W., 2002. Business ethics and stakeholder theory. Business ethics quarterly, Vol. 12 (2): pp. 113-142. Donaldson, Thomas, & Preston, Lee E, 1995. "The Stakeholder Theory of the Corporation: Concepts, Evidence, and Implications". Academy of Management Review, Vol. 20 (1): 65–91. Effron, M., Gandossy, R., & Goldsmith, M., 2003. Human resources in the 21st century. New York: John Wiley & Sons. Fitzgerald, L., Johnston, R., Brignall, T. J., Silvestro, R. M., & Voss, C. A. (1991). Performance measurement in service businesses. London, UK: Chartered Institute of Management accountants. Freeman, R. Edward, 1984. Strategic Management: A stakeholder approach. Boston: Pitman. Friedman, L. Andrew, & Miles, Samantha, 2002. Developing Stakeholder Theory. Journal of Management Studies, Vol. 39 (1): pages 1–21. ---. 2003. Stakeholders: Theory and Practice. Oxford University Press. Greenwwod, Michelle, & Cieri, De Helen, 2005. Stakeholder theory and the ethics of human resource management. New York: Monadsh University. Harrison, Wicks, Parmar & De Colle, 2010. Stakeholder Theory, State of the Art, Cambridge University Press. Kaler, J. 2003. Differentiating stakeholder theories. Journal of business ethics, Vol. 46 (1/2): pp. 71-83. Laplume, André, Karan, Sonpar, & Reginald Litz, 2008. "Stakeholder Theory: Reviewing a Theory That Moves Us". Journal of Management 34 (6): 1152–1189. Mansell, S., 2013. Capitalism, Corporations and the Social Contract: A Critique of Stakeholder Theory. Cambridge: Cambridge University Press. Miles, Samantha, 2011. "Stakeholder Definitions: Profusion and Confusion". EIASM 1st interdisciplinary conference on stakeholder, resources and value creation, IESE Business School, University of Navarra, Barcelona. ---,2012. "Stakeholders: essentially contested or just confused?"Journal of Business Ethics, Vol. 108 (3): 285–298. Mitchell, Ron, Agle, B. R, & Wood, D. J, 1997. "Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts". Academy of Management Review, Vol. 22 (4): 853–886. Phillips, J. Robert, 2003. Stakeholder Theory and Organizational Ethics. Berrett-Koehler Publishers Read More