Internal and External Stakeholders Role in Company

Business success depends on many factors that are important to consider. The talented management of work processes enables organizations to maximize the value of their results and meet the business strategy they set. Among the factors related to the companys work, stakeholders stand out. This concept includes individuals, groups, or organizations that may affect or be affected by the businesss decisions, processes, or results. Activities relevant to the needs or objectives of stakeholders are essential for the achievement of organizational goals. Stakeholders can be internal and external, depending on their interest in the business. Even though internal stakeholders are more often distinguished as primary, companies should strive for a balance in their treatment.

Companies work and contact various stakeholders, and depending on the type of influence they have, they can be internal and external. Internal contributors include those directly involved in the organizations activities and who are part of it (Internal stakeholders vs external stakeholders, 2020). For example, employees, managers, owners, and investors are the businesss internal stakeholders. External ones do not work with the firm directly, are not aware of its internal processes, and the businesss activities do not affect them directly (Internal stakeholders vs external stakeholders, 2020). Suppliers, customers, communities, governments, and lenders are examples of external stakeholders. Organizations must pay attention to relationships with all of them to achieve success.

Stakeholders have different degrees of responsibility and authority when participating in the business project. Their involvement can range from periodic participation in surveys and focus groups to full sponsorship of a project involving the provision of financial, political, or other support. The influence of internal contributors is usually more substantial since they affect the decision-making process in the organization and are primary stakeholders (Internal stakeholders vs external stakeholders, 2020; Leonard, 2019). For example, according to Bedwell (2018), if managers do not treat employees as important stakeholders, the business will suffer significant losses. At the same time, external stakeholders often reflect the interests of society, and ignoring them can lead to a halt in business activities (Leonard, 2019). These arguments illustrate the importance of taking into account all the interests of these groups and individuals.

Stakeholders may actively participate in the activities of the company or have interests that may be affected both positively and negatively during its work. Different stakeholders may have to compete and opposing expectations that may create conflicts within the project. For these reasons, it is important to understand who is interested in the company, what degree of their influence, and, based on these data, to develop relationships with them.

Sometimes stakeholders can also hinder the success of the project poorly performing work or actively creating obstacles. These stakeholders require the attention of managers, as well as the creation of plans to respond to any potential problems. Moreover, the importance of stakeholders can change during different periods of activity. For instance, if the supplier refuses to provide the raw materials necessary to start work, then the problem becomes the managers priority. In another situation, there may be a high level of personnel turnover due to unfavorable working conditions, and the focus of managers shifts to this issue. Thus, planning, flexibility, and balance in relationships with internal and external stakeholders are essential.

Modern companies are increasingly aware of the importance of their stakeholders, both external and internal. For this reason, they make considerable efforts to gain their trust and fidelity. An example of a company that takes good care of its employees, and internal stakeholders, is Google Corporation. They make an effort to make employees feel part of the team and also care about their continuous education, safety, and health (Krapivin, 2018). Their sports fields, free food, and payment programs are among the most famous in the world. Google has created an organizational culture focused on the happiness of employees and set a clear goal for them.

The business also pays more attention to external stakeholders and not only looks for quality suppliers but also analyzes and changes its influence on communities. For example, Salesforces CEO Keith Block and founder Marc Benioff are working with the San Francisco City Council to address the local homeless problem through resource mobilization (Ashworth, 2019). Apples CEO, in turn, drew attention to how the company affected the environment and hired an employee to work in this area (Ashworth, 2019). Thus, modern business companies are increasingly aware of their responsibility to communities as external stakeholders.

Thus, stakeholders are all people involved in the business, those who influence it, and those who fall under its impact. Internal ones are directly involved in the companys activities, and external ones have only some impact. Organizations depend on all stakeholders, but the degree of influence may vary in different situations. For this reason, managers should constantly analyze their stakeholders and develop partnerships with them. More and more modern companies understand the significance of this aspect and direct their resources not only to gain profit but also to satisfy the interests of their stakeholders.