Stakeholders, 'Leagues of an Octopus,' Called Strategy
Advice / Strategy
Stakeholders, 'Leagues of an Octopus,' Called Strategy
Farooq Omar, Member, Business Consultant, Pakistan
The topic is the importance of stakeholders identification as measurable metrics in the process of forming strategy. In the absence of this 'often neglected effort, some of the key and crucial 'inputs' value enablers are missed, and this gap follows all the way to its outcome in many forms, E. G, disasters, crisis, and poor organizational perfomance.
In my opinion and a bit of experience, a business when classified as an enterprise has to confront effectively with the question of ‘how to engage its stakeholders identity’? That means, not only, it is extremely important to recognize the true value of stakeholders at hand to deal with, but how best to manage them according to their varied needs.
Business entities, almost all start to think about goals first, as it is generally associated with the ‘vision of the company. Unfortunately, this vision is variably and invariably owned by the managerial stakeholders. Though, ‘non stakeholders can be worthy stakeholders but ‘not or wrongly identified’ in many forms. This purely reflects the ‘insider’ story board’ of the organization and the some external stakeholders tends to be off sight till the company starts its planning already.
Without the realization of the worth of neglecting other type of stakeholder’s interest into consideration and include in its ‘so called goal program – a prereq to strategic planning as usually perceived. In Many given scenarios ‘ecology’ of a place is also a stakeholder, since it has a value which has to be met in order to go any further. Strategists tends to take triad of customer (end-user) – Money stakeholders – organization itself, though, even the quality of air we breathe is a stakeholder in green initiatives projects & businesses, as it plays very crucial and intricate role in how the strategy will/should be designed and implemented. This stakeholder’s value in terms of its worth to impact in setting different kind of value enablers to create chain of objectives, which if calculated and adapted well form will have high probabilistic long term sustainability in the form a envisioned strategy. The real value in this approach is the ‘inherent agility’ to change, adapt, improve, discard, modify or reduce different intensities of resources of value multipliers proactively, as, almost all types and sub-types of stakeholders are taken into account. That can also reduce the ‘bumps caused by the uncertainty’ factors and mitigate risk. That will allow strategy based on lower risk = Performance.
This evolves a sure weakness and a serious flaw in the beginning stage of organizational goal planning and it leaves its long unending blood trail till its journey, passing through the value chain to all the internal and external stakeholders. And, its loss is extremely difficult to calculate as it is ‘intangible’ value which was there, but never identified, so never realized, not on the financial books, nor the degree of interest met or given/taken by the stakeholders.
So many failures or lack of meeting the benchmarked interests of the ‘defined stakeholders’ becomes a plague for many organizations in the longer run and diminish their capacity to cope with external growth rate of change and to compete. Such problems are mostly arising as the management’s initiatives are more on massive gathering and crunching the data. Leaving strategic planning with issues of finding the right direction, and all the time and resources are wasted trying to create strategic plans.
I believe that little and insufficient time is given while developing and implementing strategies (not tactical plans) in truly trying to identify the needs and expectations of all internal and external stakeholders whose different degree of involvement holds value with exclusive importance and are crucial components of value enablers throughout the strategy formulation and execution. The failure to engage all stakeholders effectively on continuous basis is a good recipe for a poor strategic planning, strategy development and its implementation.
The secret of having a successful strategic intent must involve ‘Stakeholders mapping’, according to where it fits and its worth in different timeline, and create an stakeholders priority and optimizing framework to extract the best direction to accomplish, acquire and disseminate the ‘estimated expectations’ across the board of all involved. Business is all about wishes, hopes, dreams and expectations and realization of all, and in current times, if can be in the shoes of Mr. Maslow, I would categorize the needs satisfaction in terms of ‘accomplishment’.
The crux of my notion is the importance of inducting and integrating all stakeholders (including their differentials in value) in the earliest stage of plan – planning – strategic process (strategies), is likely to have better probability of success. Last, but least, competitors are taken as ‘threats conventionally’, I would take them also as a stakeholder, whose needs and wants needs have to be maintained for good industrial health and room for more innovative growth and higher rate of return.
Thus, Success of strategy = (1+2+3+4+5+6+7+8+9) > 47, (see fig above) in numerical value is expected to be well formulated and executed. Margin of outreach (Delta adjustments are not considered, but extremely crucial on continuous basis.
This article only serves as a basic qualitative source to try to answer the correlation of stakeholder’s evaluation and quantification to have a priority based optimization in the initial stages of goal programming, and it is imperative to develop dashboards for key and expected stakeholders and updated continuously throughout the business cycle services or plan initiation.
Calculate each value and worth outcome and fill in the gaps, followed by the strategy formulation and execution. I did not get into quantitative description of strategy formulation based on my approach, as it was not the intent, and also is a massive task for now. And, I just wanted to point out many that developing strategy is not a ‘marketing jargon’ and its attachments which one has to cope with. I have to excuse for not being able to paste the introductory fig here due to some glitch. If someone is interested, kindly send me your email id and I will attach & mail back!
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