MANAGEMENT ESSAY Management Essay Management Essay I have worked with various companies who fully apply the theory of stakeholder management, and I have realized that it is the most critical thing to the success of every project in such organizations. The stakeholder theory suggests that as a unit of analysis, if we adopt the relationships between the business and various individuals who affect or affected in the process, then we have a better chance of dealing with these main tribulations. First, from a stakeholder point of view, any business can be is a sett of relationships among the groups that have a common interest in the activities that makes up the business.
This is about how stockholders, bondholders, banks, societies, and managers interact together to create trade value. To understand the business, one has to know how these relationships interrelate and change over time. It is an executive responsibility to manage and shape these relationships to create the value for stakeholders to manage the distribution of that value (Freeman 2010). Another challenge that arose was the conflict of interest by the stakeholders; the organization managed this by looking for a way to re-think problems, and the needs of the broad groups of stakeholders addressed.
This is done by creating more value to each member. In cases where tradeoffs have to be done, then the executive must figure out how to make the tradeoffs, and then focus on how to balance the tradeoffs on each side (Freeman 2010). Effective management of stakeholder relationships helps the business to survive and expand in capitalist system, but it must also reflect on the moral attempt because it concerns questions of values, potential harms, choice, and benefits for a large group for groups and individuals (Gomez 2010).
A description of management, which takes attention on the creation, alignment, and maintenance of stakeholder’s relationships better, equips practitioners to develop value and avoid the moral failures. The use of theory in understanding stakeholders cannot provide specific comparisons in terms of their production since it has some commonality across the uses. However, they can be given enough diversity to allow them to function and a prober array of settings to serve specific purposes.
This stakeholder perspective used in various disciplines, which include law, public administration, heath care, ethics and environmental policy (Freeman 2010). Many organizations have applied this method in managing their organizations. However, some prefer using other methods rather than the stakeholder methods because; it is an excuse for managerial opportunism. The main claim is that the provision of many groups by this method who management can claim their purpose benefit, this theory makes it more easier to engage in individual dealings and be able to defend it than when the shareholder concept was the solitary reason.
This method is also fare in that the managers who have a duty only to shareholders are more able to judge their performance and determine whether they have managed well or poorly. Unlike the previous managerial opportunism, the current one done under the banner of the shareholder maximization, minimizes the chances of the management team from underestimating the roles of the stakeholders in the companies to create their own benefits. The stakeholder theory is creating more accountability from the managers since they have more obligations as well as care to many constituencies, thus minimizing them from dealing with personal issues due to lack of time. This theory is also concerned with the distribution of financial outputs.
This is done automatically by depicting who receives the resources of the company first stating the reasons behind who gets what and why. Freeman (2010) claimed that the distribution process is the part of the story, and that a critical part of the shareholder is theory is only about process and procedural values that stakeholders equal say on how resources allocations process takes place and that such justice affects how they view the distribution of their own resources thus making them certified.
This enables them to positively contribute to the organization they feel the process is fair. Project can further be dependent and problematical by the stakeholder management framework in that, differentiation of legitimate stakeholders from illegitimate is not easy. It is a common misconception that stakeholder theory casts a very large net in terms of who is considered a perfect shareholder (Freeman 2010). This is because a stakeholder is any person who can lead to some changes in an organizations objectives and goals.
The issue of primary and secondary shareholders also affects this theory and hence this brings the idea of dependence in the project. This framework fails to address problems in an organization because the recent financial crises show the consequences of separating ethics from capitalism. The stakeholder’s management system advocates this and hence makes it difficult to much with the current trends and emerging issues in the globe. This method also follows only one principle hence makes it difficult to compare with other marketing strategies.
An old system needs to be upgraded to merge the current market demand and changes in technology around the globe as well as avoiding biasness to the stakeholder’s ability. Reference List Freeman, R. 2010. Strategic management: A stakeholder approach. Boston: Pitman Publishing Inc.