Stakeholder theory and Strategy - Essay Example

Subsequently, the study elucidates how significant stakeholder relationships are in a firm’s enduring existence and survival. Likewise, the paper attempts to concisely illustrate the importance of firms’ employing stakeholder management in their day-to-day operations at the same time succinctly presents how the use of stakeholder analysis can advance corporation efficiency and facilitate a corporation’s effectual policy/decision-making. For the investigation’s methodology, it makes use of the qualitative research employing the interpretivist/inductive stance mode of inquiry.

It then concludes with the premise that stakeholders can provide the firm with access to the resources and capabilities that they own, create, and control only if the corporation promotes the stakeholders’ interests or stakes and thus offers the stakeholders opportunities for achieving their objectives. This premise directly follows from the dynamics that create organizations stating that an organization is an amalgamation of people who interact with each other in particular and often repeated ways over some period of time.

To attract people to its activities and thereby to assure its continued existence, an organisation must bring some form of benefit—whether psychological, social, cultural, professional, or economic —to the people who participate in its activities. The word stakeholder is compellingly authoritative (Phillips, Freeman, & Wicks, 2003) due to its all-inclusive and at the same time logical depiction of how organizations conduct their business and day-to-day existence. In his pioneering work, Freeman (1984) recommended a stakeholder method to strategic management, inferring that it is imperative for organisations to pay attention to those who affect and are affected by the corporate actions.

From that time on, stakeholder theory has become a ‘middle-of-the-road’