What is a Stakeholder?
Traditionally, stakeholders are defined as those who have an interest in the activities of an organization. They are potentially or actually affected by the actions of the organization, or can have an affect on the organization. Lately the term ‘stakeholder’ has also been used to mean those people or groups who have an interest in a problem or project domain, like the pollution of a river or the revitalization of a town’s economy.
The potential or actual impacts can be positive and negative. The table below shows examples of the kinds of impacts that could define a stake in a company.
What is the Stakeholder 360?
The first step in the Stakeholder 360 is to define which organizations should be interviewed. Then the leaders of the organizations are interviewed about their relations with other organization and their interests in the focal issues or focal organization. The interview data is converted into graph showing the socio-political network among the stakeholders and the issues. These graphs immeditately suggest strategies for moving towards a pattern of social capital that better promote collaboration towards sustainable development.
360 of What?
The ‘360’ refers to the 360 degrees of a circle. It is a metaphorical way of saying that every stakeholder is encircled by a network of other stakeholders. The Stakeholder 360 is intended to measure all of the relationships of all of the stakeholders in the network with each other — everyone with everyone — therefore, ‘360’.
The stakes can be in a company or other focal organization (e.g., a municipal government) or they can be in a shared concern (e.g., community economic development, pollution of a shared lake).
There are several criteria that indicate the boundaries of a network. The single best way to define the boundary is to get out and ask questions. In the “snowballing” technique, interviewers ask each stakeholder who else they think is a stakeholder. Then they try to talk to those people. Eventually they encounter nominees whose stakes are so small that they do not want to be interviewed. By that point the interviewers have probably already interviewed the core of the network.
Examples of how a company has impacts on stakeholder groups
Examples of how stakeholder groups have impacts on a company
Focus on Group Level
The Stakeholder 360 focuses on the group level. People have more socio-political impact when they work in groups. The groups do not necessarily have to be formal organizations. For example, in a study in Papua New Guinea, we treated clans as stakeholder groups and interviewed the elders as the representatives of the clans. However, we would not treat “citizens” as a stakeholder group for a city council, nor “customers” as a stakeholder group for a consumer products company. The reason is that they are not organized into a group that articulate a collective stance. At times, a single individual can be treated as a stakeholder, with the implicit assumption that they have a high level of influence potential in a socio-political sense. For example, sometimes experts, politicians, or celebrities fall into this category
Census Completeness, Not Sample Size
People familiar with public opinion research sometimes question the small number of interviews involved in Stakeholder 360 studies. They forget the difference between a sample and a population census. The Stakeholder 360 does not involve a random sample survey of stakeholders. Instead, it attempts a census of them. The “sample size” is irrelevant because there is no sample. Instead, there is a census. In terms of the number of interviews conducted, what is important is that the census includes all of the members of the stakeholder network.¹
Multiple Methods are More Strategic
Samples and censuses each have their strengths.² It is often a good idea to use the Stakeholder 360 in conjunction with a random sample survey of some unorganized population like customers or citizens. Stakeholder group leaders tend to be mass opinion leaders. Sample surveys can tell you how broadly legitimate the views of different groups are perceived to be. Elected government stakeholders are especially interested in these kind of findings. The Stakeholder 360, by contrast, gives insights into where public opinion is headed next. It also taps into more highly articulated versions of each opinion tendency and trend.
1 The methodological question is not whether enough groups were interviewed to estimate population means. Rather, it is whether all (100%) of the concerned groups were interviewed.
2 See Boutilier (2000) for a conference paper on the advantages of multiple methods in research with customer stakeholders.