Stakeholders and objectives - Business A Level Study Notes
Overview
Imagine a school play. Lots of different people care about that play, right? The actors, the director, the parents, the audience, even the person who sells tickets! Each of these people wants something different from the play – maybe a great performance, maybe proud parents, maybe to make some money. In business, it's exactly the same! This topic helps us understand all the different groups and individuals who have a **stake** (meaning they care about or are affected by) a business. We'll also look at what each of these groups wants the business to achieve – these are called their **objectives**. Understanding stakeholders and their objectives is super important because businesses need to keep many different people happy to succeed. It's like a juggling act, trying to balance everyone's needs and wants!
What Is This? (The Simple Version)
Think of a business like a big, busy ant colony. Lots of different ants are doing different jobs, and lots of other creatures might live nearby or visit. All these different ants and creatures are stakeholders – people or groups who have an interest in, or are affected by, what the ant colony (the business) does.
Now, each of these stakeholders has something they want the ant colony to achieve. These are their objectives (their goals or what they want to happen). For example:
- The Queen Ant (the owner) might want the colony to grow bigger and stronger.
- The Worker Ants (the employees) might want good food and a safe place to live.
- The Ant Lion (a customer) might want easy access to food (the ants!).
So, stakeholders are all the people and groups connected to a business, and objectives are what those people and groups want from the business. It's all about who cares and what they care about!
Real-World Example
Let's imagine a local bakery, 'Sweet Treats'. Many different people care about this bakery, and they all want different things:
- The Owner, Mrs. Henderson: She's invested her money and time. Her main objective is to make a good profit so she can pay her bills and maybe open another shop one day. She also wants happy customers and a good reputation.
- The Bakers and Shop Assistants (Employees): They work there every day. Their objectives include getting a fair wage, having good working conditions (not too hot, safe equipment), and maybe opportunities to learn new baking skills.
- The Customers: They buy the delicious cakes and bread. Their objectives are tasty, fresh products at a reasonable price, good customer service, and a clean, friendly shop.
- The Suppliers: These are the people who sell flour, sugar, and eggs to Mrs. Henderson. Their objective is to be paid on time and for 'Sweet Treats' to keep buying their ingredients regularly.
- The Local Community: People who live near the bakery. Their objectives might be that the bakery doesn't cause too much noise or traffic, and maybe that it supports local events or charities.
- The Government: They set rules and collect taxes. Their objectives are that 'Sweet Treats' follows health and safety laws, pays its taxes, and employs people (reducing unemployment).
See how everyone has a different 'wish list' for Sweet Treats? Mrs. Henderson has to try and keep as many of these people happy as possible!
How It Works (Step by Step)
Businesses deal with stakeholders and their objectives in a few key steps: 1. **Identify the Players:** First, the business needs to figure out who all its **stakeholders** are. This is like making a list of everyone who cares about your football team – players, coaches, fans, stadium owners, etc....
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Key Concepts
- Stakeholders: Any individual or group who has an interest in, or is affected by, the activities of a business.
- Objectives: The specific goals or targets that a business or its stakeholders aim to achieve.
- Internal Stakeholders: Individuals or groups who are part of the business itself, such as owners, managers, and employees.
- External Stakeholders: Individuals or groups outside the business who are affected by or can affect its operations, such as customers, suppliers, and the government.
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Exam Tips
- →When asked to identify stakeholders, always categorise them (e.g., internal/external) and explain *why* they are a stakeholder.
- →For each stakeholder, clearly state their primary objective(s) and provide a brief explanation of *why* they hold that objective.
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