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Erschienen in:
Welcome to Corporate Responsibility Kapitel lesen Erstes Kapitel lesen

2017 | Supplement | Buchkapitel

10. The Rocky Road to Achieving Stakeholder Value in Business Strategy

The Beginning of an Ongoing Journey Navigated by PURPOSE

verfasst von : Linda O’Riordan

Erschienen in: Managing Sustainable Stakeholder Relationships

Verlag: Springer International Publishing

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Abstract

This chapter highlights the emerging but compelling aim to create long-term stakeholder value derived from entrepreneurial PURPOSE (the ‘why’) as the principle connector, harmoniser, and differentiator for generating responsible profits. Emphasising the human role as the fundamental basis for all organisational activity, this chapter critically reflects on the four generic steps presented in the Stakeholder Relationship Management Framework in the previous chapter (the ‘how’). Focused on the search for meaning as a key driver of individual purpose, this chapter draws attention to the requirement for a transformed corporate approach, which manifests itself in stakeholder values (the ‘why’) driving the organisation’s mission and vision. This approach both recognises the salience of profits for the long-term success of the business while augmenting the corporate commitment beyond a narrow shareholder focus to inclusively embrace a broader scope of stakeholder groups. The underlying rationale assumes that connecting the various stakeholder interests leads to greater value creation for all groups. While the aim to optimally leverage the corporate impact for their stakeholders is not new in the sense that in practice, the entrepreneurial spirit has been following this approach for years; the research outcome identifies that the current management tools for developing and measuring a stakeholder-connected resource investment strategy are underdeveloped. Because they primarily focus on a profit maximisation business purpose, their narrow approach is fuelling a disconnection between how successful entrepreneurs actually behave and how economic and business studies are comprehended and taught. This chapter concludes that to effectively manage sustainable stakeholder relationships, this theoretical, practical, and educational missing link in corporate approaches to responsible management requires connection in order to make organisations relevant for their stakeholders.

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Vorheriges Kapitel Conceptualising Stakeholder Relationship Management
Fußnoten
1
From the famous Sicilian work: The Leopard.
 
2
When economists refer to the ‘opportunity cost’ of a resource, they mean the value of the next highest-valued alternative use of that resource. While the word ‘opportunity’ in ‘opportunity cost’ is actually redundant because the cost of using something is already the value of the highest-valued alternative use, this concept has powerful implications for responsible business in the sense that decision-makers are reminded by this redundancy that the cost of using a resource arises from the value of what it could be used for instead (Henderson, 2016).
 
3
For clarification, in this regard, non-profit organisations by definition serve different interests and accordingly have an alternative purpose. They consequently operate under separate operating conditions which require tailor-specific management approaches and measurement criteria.
 
4
From among the various alternative labels, for brevity purposes, the term ‘CR’ has been adopted in this chapter to signify the concept of responsible management (as defined in Chap. 2) within a corporate sustainable stakeholder relationship setting.
 
5
The potentially paradoxical appearance of advocating the adoption of a particular value stance on the one hand (i.e. organisational purpose focused on stakeholder value creation) while simultaneously stressing the limitations of a normative approach underscores the complex nature of responsible management, as well as the importance of differentiation between individual and organisational units of analysis.
 
6
For clarification, while this approach proposes achieving competitive advantage via a shift in competitive strategy away from aggressive fighting or ignoring competitors as potential features of a transformed new logic of competition and differentiation, nevertheless the term ‘competitive advantage’ is chosen for its breath of possibilities and application in real-world business practice in contexts where direct collaboration with competitors is not a feasible or desired option.
 
7
Appreciating while doing so, that similar to profit, as noted in the previous point, the themes of responsibility, sustainability, and ethics are not the company’s direct purpose but instead key contributing factors to the successful achievement of that purpose.
 
8
With respect to the science of human motivation and the dynamics of extrinsic and intrinsic motivators, for example.
 
9
The tragedy of the commons scenario refers to an economic theory of a situation within a shared resource system where individual users acting independently according to their own self-interest behave contrary to the common good of all users (Hardin & American Association for the Advancement of Science, 1968).
 
10
For clarification, the pragmatic stance adopted in this book advocates that realising this mission could be construed as the individual decision-maker’s only valid ‘obligation’. Likewise, the only binding duty of academic researchers and business educators could be interpreted as the ‘responsibility’ to illuminate and contribute valuable solutions for connecting the theory of business with its real-life application. By definition, matters of ethics remain critically valuable in this scenario as hygiene factors or fundamental expected customary givens. Control of these matters can be ensured at the corporate level via governance and compliance systems, and/or at the macro-level, potentially via ‘soft’ guidelines, such as the UN Global Compact and the ISO 26000 principles , as well as by ‘hard’ legal regulation.
 
11
Explained above in greater detail.
 
12
Jobs was undoubtedly lauded for his ability to create value for his customers via connecting creativity with technology. His remarkable feats of engineering driven by imaginative innovation encouraged those in his internal working relationship network to speak candidly, often brutally so, in his aim to create the innovative solutions that resulted. Clearly, in his approach, his personality and his products were inherently connected via his passion, perfectionism, obsessions, artistry, and compulsion (Isaacson, 2013).
 
13
For clarification, this process is inherently implied in the four steps of the new Stakeholder Relationship Management Framework (Version 4) for connecting stakeholder interests to create responsible profits, which was presented in the previous chapter.
 
14
The term ‘hygiene factor’ is borrowed from Frederick Herzberg’s (1959) original concept in his book The Motivation to Work in which he proposed the term to reflect those motivators which are considered to signify maintenance factors (i.e. necessary to avoid dissatisfaction but that by themselves do not provide satisfaction). In line with Herzberg’s original meaning, the term is implied here to comprise an adaptation, in the sense that here, hygiene factors represent the accepted behavioural norms as opposed to something distinctive. This interpretation does however recognise that ethics and sustainability can serve as contributing factors to personal satisfaction at an individual level.
 
15
In ‘tragedy of the commons’ resource depletion, individual users acting independently according to their own self-interest behave contrary to the common good of all users, thereby ultimately creating a situation of instability in which the demand for a resource outweighs its supply.
 
16
Rather than quantity and efficiency.
 
17
For clarification, as noted in this and previous chapters, while the measurement and management tools proving this claim require further development, the rationale adopted in this book is that the suggested stakeholder orientation can be understood as a valid approach simply because it ‘makes good business sense’.
 
18
Values can be understood as comprising the ideas, standards, or conduct which are recognised by a community as desirable and which provide orientation for the people in a community.
 
19
This includes the requirement to develop new perspectives and evaluation tools to appraise for example, cultural and other macro-level or industry-specific factors, in addition to the organisation and individual level focus addressed here.
 
20
For further details, please refer to the PPPP framework discussion in the previous chapter.
 
21
For clarification, because they are based on TBL or triple top line (TTL) values (Elkington, 1997; McDonough and Braungart, 2002), or the PPPP framework outcome areas, the three principles of multiple, collaborative, and connected value within the SVC concept are, by definition, interrelated in the sense that they combine commercial innovation with inclusive value creation and allocation. As a result of the inherent synergies and value creation potential between these principles discussed in greater detail in previous chapters, their precise isolation is problematic (Ćwicklicki & O’Riordan, 2017).
 
22
Ban Ki-moon is a Korean name. Because the family name is Ban, this reference is listed in the list of references under Ban (2011).
 
23
In the words of Shakespeare (1992), “…for there is nothing either good or bad, but thinking makes it so”[!] (Hamlet, Act 2, Scene 2).
 
24
People, planet, prosperity, and profits – please refer to Chap. 9 for further details.
 
25
A process which took three times longer than the lifespan of those who were building those same cathedrals.
 
26
Finding Nemo is a 2003 American computer-animated comedy-drama adventure film produced by Pixar Animation Studios and released by Walt Disney Pictures.
 
27
Such as those recently highlighted in The Economist.
 
28
Including artificial intelligence (e.g. such as self-driving cars) and its implications for responsible management.
 
29
See O’Riordan and Zmuda (2015, p. 499) for further details.
 
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Metadaten
Titel
The Rocky Road to Achieving Stakeholder Value in Business Strategy
verfasst von
Linda O’Riordan
Copyright-Jahr
2017
Buch
Managing Sustainable Stakeholder Relationships

Print ISBN: 978-3-319-50239-7

Electronic ISBN: 978-3-319-50240-3

Copyright-Jahr: 2017

DOI
https://doi.org/10.1007/978-3-319-50240-3_10