Success with your startup has a lot to do with your ability to manage relationships with stakeholders. The Mendelow Matrix is an important tool for the aspiring entrepreneur. Stakeholders include anyone who might have an interest in or influence on your business. Stakeholder mapping provides a useful project management tool for understanding these relationships. The aim is to make the best possible use of them to further our business aims. As you enter the world of business the actions you take affect different kinds of people.
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A stakeholder is anyone, as an individual or a collective such as organisation that has an interest or is concerned with the actions of a business to the extent they are affected by or they can influence it. A business is likely to have numerous stakeholders including directors, shareholders, employees, customers, creditors, the government and the community in which it sits.
A business will frequently find that different stakeholders have different priorities, this often leads to conflict. For example, an employee would like to be paid more. A business will therefore need to find a way to balance the conflicting priorities of its stakeholders.
If a stakeholder has a financial interest this will increase the level of interest, are they an investor who may consider their investment to be at risk or possibly an employee, their employment is their livelihood so would not want to risk that.
As an example; employee may be averse to an organisation investing in new technology to increase automation thus placing jobs at risk. If a stakeholder does not have alternative options to dealing with or working with the organisation, this would increase their interest.
Likewise, an organisation may supply a product that cannot be obtained elsewhere. Instances like this would increase customer interest. If an employee lost their job, they may not immediately find another so employee interest would increase if their employment was considered at risk. Power is determined by whether the stakeholder can take action that will make an organisation sit up and think. Employees can strike, withhold their labor which can be incredibly disruptive to an organisation and its business potentially damaging relationships with customers.
Investors can withdraw their investments especially if the organisations approach to risk is no longer aligned with their own. What are stakeholders? This group are likely to have the significant influence; they may be the driver behind the change or strategy. They will likely have the power to stop the change or strategy going ahead if they are unhappy. High Interest and Low Power; this group have an interest in what is happening, however they are unlikely to have the power to influence change.
This group should be kept informed. Whilst they have little power themselves they could attempt to join forces with a group with power. By keeping them satisfied they are less likely to gain interest and exercise their power to influence. Low Interest and Low Power; this group is unlikely to have an interest in the organisation and direction; this is often due to their lack of power to influence a situation. They are likely to accept the position and show little if any resistance.
An essential strategic project management tool What factors may dictate whether a shareholder may exercise power?
Does the stakeholder have the power? Banks and other finance providers can call for repayment of overdrafts or loans. Bizzle Dizzle bizzledizzle. We will assume you are happy to accept this, but you can opt out if you wish at any time. Accept Reject Read More. Cookies on This Site. Necessary Always Enabled.
A stakeholder is anyone, as an individual or a collective such as organisation that has an interest or is concerned with the actions of a business to the extent they are affected by or they can influence it. A business is likely to have numerous stakeholders including directors, shareholders, employees, customers, creditors, the government and the community in which it sits. A business will frequently find that different stakeholders have different priorities, this often leads to conflict. For example, an employee would like to be paid more.
Stakeholder Analysis is the first step in Stakeholder Management, an important process that successful people use to win support from others. Managing stakeholders can help you, too, to ensure that your projects succeed where others might fail. In this article and video, we'll look at that crucial first step — Stakeholder Analysis — in more detail. Then you can move on to our next article to plan your stakeholder communications.
What Is Mendelow’s Matrix And How Is It Useful?
The objectives of an organisation will be governed by its key stakeholders. These key stakeholders be determined using stakeholder mapping. Mendelow's matrix is a popular method for performing stakeholder mapping. Stakeholder mapping can help deal with stakeholders' conflicting demands. It identifies stakeholder expectations and power and helps in establishing political priorities. The process involves making decisions on the following two issues.