Who,exactly, are your stakeholders?

STAKEHOLDER

We insisted on this subject so many times. Startupping for us is the art of involving someone with the development of an idea able to create value.

But exactly with who are you supposed to communicate?

With stakeholders, obviously, one may say. A stakeholder is anyone with an interest in your business.

But sometimes this area of business planning is neglected and even the word “stakeholder” is so generic and hazy.

A more common and widespread way to consider the problem is: a stakeholder is anyone we could meet along our entrepreneurial journey and that shows, proves or somehow pretends to have something to say about us and the way me manage our business. Or maybe, someone we would like (in our dreams) to have as stakeholder.

We believe that in reality stakeholder engagement is a value creating/mandatory activity to be performed on a regular basis since the very first moment in your startup development.  At least for two very good reasons:

corporate identity: you can engage with third parties only if you know who you are. Any entity willing to communicate with another one should beforehand define its identity. There is no communication if there is not a well defined “me” area and and therefore an external environment to relate with (“the others” area) So is in business too.

risk management: excluding some specific and internal risk factors, strictly connected with technical aspects related to the supplied service/product, all the rest is somehow originated by the nature of the relationship with stakeholders. Probably, the same concept of risk is deeply linked with stakeholders. If risk is defined by the likelihood of an event and the caused damage, is clear that the concept of damage is bonded (and it changes accordingly) with stakeholder’s perspective. Damage for customers (not getting what they paid for)  damage caused to investors (not getting their reward),damage caused to community (f.i   the environmental impacts). So is important to involve them in their risk management approach: the sooner, the better.

But who these stakeholders might be?

  • Investors – owners, bank, VC or investor
  • Business consultants – someone providing specific and valued knowledge
  • HR – management/owners and staff; the interest of human resources in the business’ performance is therefore obvious; addictionally, management may have extra concerns concerning risk and liability (depending on startup’s liability status, the owners might have risk to their personal wealth)
  • Customers – increasingly looking forward to know everything not just about your product/service but instead about the firm itself, and moreover about you as a founder. This means that nowadays there are increasingly more ways a customer may assume to be affected/influenced by your company’s behaviour. Take into the due account this aspect!
  • Suppliers – and moreover outsourcers, controlling specific and value-adding processes of your value chain
  • Government, authorities and certification bodies– concerned about business health, business compliance and reputation, impacts on society, local community , public health and on environment and of course in having firms able to pay taxes.
  • Media

And, once you started with this stakeholder management process, what about your goals?

They should be at least some of the following:

increase their risk tolerance towards having a relationship/investing/collaborating with your firm

increase their trust, not just in your product/service nor in the firm, but in you as a manager and/or as a founder

increase their commitment, for instance with your vision, your business model or just your value proposal

making them always willing to tell you the truth about you and your company: this topic is of course strictly related with the concept of trust and with your ability of making them feeling comfortable when communicating with your firm’s representatives.

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3 pensieri riguardo “Who,exactly, are your stakeholders?

  1. In Entrepreneurship education we define a stakeholder as anyone who has an economic interest in your business. This would, of course, include investors and banks, and might include suppliers. A supplier would be a stakeholder if he gives the business credit terms. A customer wouldn’t generally be referred to as a stakeholder. Do you see it differently?

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    1. yes, I’m actuallly focusing on a wider cluster of subjects, who, as referred in the article, may pretend to own a stake in the company’s business…. a bit in the line of CSR spirit, I guess that, especially for a startup, the stakeholder community could be bigger than that. Customers very often are also supporters and the very first marketers of a startup, or even more if you think to crowfunding ….. Beyond that, the article rekates the definition of stakeholder not just to the concept of economic interest, but to the concept of risk (in a bi-directional way)

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