Internal versus External Stakeholders
The success and the continuity of the organization operations rely heavily on the stakeholders. Companies usually have two major categories of stakeholders: internal and external. Despite the diverse roles and responsibilities of the two groups, they can either hamper and or facilitate the growth of the business based on how they are treated.
It is hard to tell between the internal and external stakeholder who is the most important. The above argument is based on the fact that each stakeholder plays a distinct and vital role that contributes to the running of the company. For example, investors or shareholders are external stakeholders who finance the operations of the company. On the other hand, the employees and the management are internal stakeholders who run daily activities of the company. Without investors, external stakeholders, the company will not be able to initiate its operations. In the same light, the organization without employees is like an empty shell even if when it has been financed to commence its activities.
From the stakeholder-organization relationship perspective, internal stakeholders are more important than external stakeholders. Internal stakeholders are directly involved in the financial and operational processes of the company, unlike the external stakeholders who are indirectly involved in the running of the organization. Besides, in some companies the management, the internal stakeholders are the financiers. It is important to note that management and employees mainly influence the organization’s decision and they are also likely to be impacted by the company’s strategy and growth. However, from the business continuity point of view, external stakeholders, and mainly, the customers are the most important for the organization. Customer generate revenue for the company that is used to pay employees in term of salaries and wages, and reward investors in the form of dividends.The organization treats the two groups of stakeholders differently based on the company’s goals and objectives. For example, research shows that Seattle Genetics treats its internal stakeholders well. Seattle Genetics is a biotechnology organization dealing with the development of antibody-based therapies for cancer treatment. The company has approximately 800 employees, and it offers them a variety of programs including seminars, job-related conferences, on the job training to boost job-related skills and tuition fee reimbursement (Thottam, 2018). Seattle Genetics operations and future relies primarily on its employees, and as such the organization has to invest in its workforce by developing their career goals. The treatment of employees at Seattle Genetics aligns with its positions on the types of employees the company hires. Seattle Genetics anticipates for enthusiastic employees who are team members and can achieve individual goals while preserving the spirit of collaboration.
Amazon treats its external stakeholders, and more so their customers well. Amazon’s goal is to serve customers better by giving them the best services. The seriousness of the company in meeting customer needs is rooted on the notion that customer is a king and as kings they never lie (Danziger, 2018). In the bid to meet customers’ needs, Amazon is always in the process of finding new approaches including innovating to solve customer problems. Besides, the company has a customer service team to give free months of prime services and gift vouchers to customers who have raised complaints (Morgan, 2018). Amazon believes that without a customer, Amazon will not continue operating in the foreseeable future, and as such it has always put the customer first.An organization cannot exist as entirely as a separate entity without the contribution of the stakeholders. Internal stakeholders, for example, the management and employees aligns the organization’s daily activities with the company’s vision and mission. On the other hand, the shareholders and customers provide the finance needed to keep the organization running. As much as all stakeholders may be necessary for the success of the organization, the external stakeholders, and especially the customers top in the list. Customers generate the revenue needed to maintain the company operations, and without profits, the company will close.