P2 stakeholders- Define stakeholders including an explanation of the difference between those that are internal and those that are external.??
Definition of stakeholders
Stakeholders are groups or individuals that influence activities in the business. there are two types of stakeholders internal and external. Internal stakeholders are people that benefit financially from their contributions to the business success as they are within the business. Example of internal stakeholders is employees, directors, shareholders and internal customers. External stakeholders are affected by the consequences and actions of the business success and are outside of the business. Examples of External stakeholders are competitors, banks, external customers, the government, suppliers, consumer, sponsors and trade unions.
Internal and external stakeholders – DFC (delicious fried chicken)
Internal and external stakeholders – British heart foundation
Employees are an internal stakeholder, the influence that they have over the business is that employees are the ones that provide and determine the quality of customer service, the productivity of the business, and the quality of the business. It wishes to provide excellent services and good quality food therefore, the employees’ actions that affect the success of the business’ purpose.
Another internal stakeholder for this business is the owner, they influence the business by making the critical decisions and providing detailed information for the employees as thy need to follow strictly. The owner also keeps the business efficient in their productions in order to satisfy customers , therefore this stakeholder affects the purposes of business and is a very important stake holder. The owner should be capable of training the new and current employees in how to provide standard customer services, along with service provision. Furthermore, DFC is a sole trader business therefore, they would not have enough expenditure to spend on hiring staff, such as an accountant, or a human resources department, this means that the owner must fill out such task, managing the finances, and managing the recruitment of employees and firing them.
Another internal stakeholder are the directors, where they influence the organisation by making important and critical decisions, providing the detailed information for their employees. In order to keep the business efficient in their productions. The way that it affects the purpose of a business is that the directors are the ones who will make the decisions on what specific topic that they will address. Along the decisions on who they will hire, which will effectively execute their purpose. Directors influence the purpose of the organisation by making the decisions on how they should operate their actions; therefore, they are the ones who provide the results of how efficient they are.
Customers are another external stakeholder; they influence the business by deciding the types of products sold from the business. Businesses are capable of satisfying the needs and wants of people as everyone has different preferences.
Supporters are another external stakeholder, as their influence over a business is that they are the ones that finance the operations that in a business. Supporters influence businesses because the advertise that they make are for them.
Another external stakeholder are suppliers, the influence they have over the busine ss, is that they are the ones who deliver and provide the stock for businesses. The quality of the stock that is delivered to the business has to be good quality, without any damages to the products, if not they are not allowed to sell damaged or faulty stock to customers. Furthermore, the punctuality of the stock arriving to the business has to be on time. Unless they will not be able to sell their food to customers causing the business to lose income and profits.
The government is an external stakeholder it influences how the organisation operates with their business. The government funds some non-government organisations (NGO) giving them money to operate Furthermore, the government implements rules and regulations, by making laws and issuing taxes which keep businesses and organisation in control following conducts and legal acts, keeping them operational and ethical. For example, a legal act, which says workers, do not work more than 48 hours a week on average, unless they choose to. This law is known to be called the ‘working time directive’ or ‘working time regulations’ for the safety of the employees.
Competitors are another external stakeholder because; they influence the business by competing against them, in order to be the leading business within the market. Therefore, the business has to find a way in order to compete against the competitors and be ahead of them within the market. They will conduct market research in order to be better than their competitors will. The prices that the competitors put on their menu will decide how much the business will put their prices, meaning that the competitors influence this business by how they use their marketing strategies but also how they are going to conduct their business in order to best their competitors.