Critically discuss the connections between stakeholder claims and the product market - Essay Example

Another group of stakeholders beyond these three categories form the secondary stakeholders which include the government, communities, etc.., The capital market stakeholders such as the investors, debt suppliers and banks would want to have a right to decide what the organization has to do in order to maximise the shareholder wealth. However, the organizational stakeholders such as the employees and the unions have a claim on how the company operates to achieve the objectives. On the contrary, the product market stakeholders are concerned with the way they will be affected by the firm (Haslam, Neale and Johal, 2000).

The product market stakeholders include the suppliers and the customers. These stakeholders have an important role to play in the organization and its value, and in turn, have a major effect on the other stakeholders of the firm. The customers of a firm expect high value from the firm in all their encounters. However, they will also have a lot of choices in the market for the product or service, and hence the prices have to be attractive to them. The customers choose a product or service, not only based on the quality but also on the costs involved.

Hence their primary expectation or demand from the firm is a reliable and high quality product at the lowest cost (Sloman, Sutcliffe, 2004). The suppliers on the other hand have a considerable power over the firm, as they control the basic products or services required by the firm in its value chain. The power of the suppliers and their claims in the firm differ based on the availability and the level of competition in their products and services. In case of a supplier having a monopoly in the market, the supplier will have a high level of claims in the firm’s activities and will not be affected profoundly due to other stakeholders (Sloman and Sutcliffe, 2004).

However, in an open market with a number of suppliers, the firm and its