Climbing the ladder to success. Learning Aim: To understand business decisions and stakeholders. A* Evaluate how stakeholders could influence a businesses decisions Assess the conflicts that may occur between the stakeholders Discuss why a stakeholder has an interest in a business Identify who stakeholders are A B C Climbing the ladder to success.

What is a stakeholder? A stakeholder is an individual or a group which has an interest in and is affected by the activities of a business; stakeholders have an interest in how the business operates and whether or not it is successful.

Who are the stakeholders? Business owners Other external groups (e.g. pressure groups) Shareholders Competitors Managers & employees The media Customers Banks and other finance providers Suppliers Government Local community

What stakeholders are interested in? Mainly interested in… Shareholders / Owners Return on investment + profits and dividends Success and growth of the business Proper running of the business Managers & Employees Rewards, including basic pay and other financial incentives Job security & working conditions (e.g. holidays) Promotion opportunities + job satisfaction & status – motivation, roles and responsibilities Customers Value for money Product quality & customer service Suppliers Continued, profitable trade with the business Financial stability – can the business pay its bills? Banks & other finance providers Can the business repay amounts loaned or invested? Profitability and cash flows of the business Growth in profits and value of the business Government The correct collection and payment of taxes (e.g. VAT, Income Tax) Helping the business to grow – creating jobs Compliance with business legislation Local community Success of the business – particularly creating and retaining jobs Compliance with local laws and regulations (e.g. noise, pollution)

Climbing the ladder to success Who are the stakeholders of Beauchamps? A*: Evaluate how these stakeholders can affect the schools decision making A: Assess any conflicts that may occur B: Discuss why they may have an interest in the school C: Identify the stakeholders of Beauchamps Climbing the ladder to success

Stakeholders of Beauchamps Students Governors Teachers Parents Competitors Local Community Non-teaching Staff Essex County Council

Potential conflicts between stakeholders Business Decision Supported By? Opposed By? Cut jobs to reduce costs Shareholders Banks Employees Local community Add extra shifts to increase factory capacity Management Customers & suppliers Introduce new machinery to replace manual work Customers Increase selling prices by 10% to improve profit margins

Scenario Stakeholders supporting Stakeholders Opposing Government has decided to make cuts in funding to education Government The governors have mad e a decision to reduce teacher pay in order to spend the money elsewhere in the school. (For example educational visits to bring the curriculum to life) The school have made a decision to cut lunch breaks from one hour to half an hour to save teaching hours and pay Teachers strike for additional pay.

Climbing the ladder to success Potential conflicts between the stakeholders at Beauchamps A*:Evaluate how these stakeholders could influence the schools decisions A: Assess any conflicts that could occur between these stakeholders B: Discuss why these stakeholder have an in the school C: Identify potential conflicts between the stakeholders of Beauchamps Climbing the ladder to success

Climbing the ladder to success Look at the following statements referring to stakeholders and write down which groups of stakeholders it affects. Statement 1: A decision by those who run the business to introduce a system for monitoring the amount of pollution that it creates. Statement 3: A decision is made to cut cost by restructuring the business which results in redundancies. A*: Evaluate how important stakeholders opinions are to a business A: Analyse whether these impacts are positive or negative B: Examine how they affect this group of stakeholders C: Identify which group of stakeholders it affects Statement 2: A decision is taken to switch the sourcing of raw materials and components from the UK to a firm in Malaysia which reduces costs and boost profits. Statement 4: The introduction of a system which puts the staff at the heart of the decision making process in an effort to improve productivity and quality, allowing the business to reduce prices. Climbing the ladder to success