[Recently I participated in a virtual meeting of the Commission on Public Relations Measurement & Evaluation. I came away impressed by the quantity and quality of work that the Measurement Commission has produced since it was organized with the Institute in 1998. All of the research is available free on this website. Here, a founding member comments on stakeholder management.
– Bob Grupp, IPR President and CEO]
Thoughts on Stakeholder Management
By John Gilfeather
In June, I left a job at a major global marketing research firm where my title was Executive Vice President, Stakeholder Management, North America. The title had a couple of curiosities about it. One was that my duties did not extend to Canada or Mexico, so “North America” was a bit of title inflation.
The other curiosity was that many people with in the firm and among the firm’s clients did not really know what stakeholder management meant. “Stakeholder” is not a word that is used much in marketing. In marketing, you have consumers, shoppers, customers, prospects, segments, niches – but not stakeholders. Part of the reason is that traditional marketing communications is outbound persuasion. Here is the product/service. Here are the features and benefits. Here are the competitive advantages and the unique selling proposition. Now buy the product or service.
At a big company meeting where I was supposed to introduce what was new and exciting in my area, I decided to confront the issue of lack of understanding of stakeholder management. I started by asking the question, “How many of you have a very clear understanding of what Stakeholder Management is all about?” I think fewer than half of the audience of 250 raised their hands. I conceded the point.
After all, we do not use the term stakeholder management in our personal lives. When I go to the supermarket, I have never overheard two people leaning over their shopping carts talking about how Sally or Joe was having stakeholder management problems. I strongly recommended that my colleagues not go home and tell their significant others, “You are an important stakeholder and I promise to pay more attention to managing our relationship.” Done that. Been to the emergency room.
These thoughts are offered as an introductory note to one of my favorite papers on the IPR website – namely, Brad L. Rawlins’ Prioritizing Stakeholders for Public Relations. This is a short, concise paper that packs a powerful punch. The thinking is organized into four logical steps.
- First, before prioritizing, make sure everyone knows who all the stakeholders are and what (conflicting) agendas they are bringing into the game.
- Second, Professor Rawlins provides guidance for prioritizing stakeholders based on their attributes of legitimacy, power and urgency.
- Third, he overlays the concept of involvement; i.e. the extent to which individual stakeholders personally connect with the situation or issue.
- Fourth, is the real payoff – a set of guidelines for communications to different types of stakeholders.
So stakeholder management is not an arcane practice. It is actually something we engage in every day. Professor Rawlings has given us an excellent summary of the science beneath the art of stakeholder management.
Where have I heard that before?
7 thoughts on “Thoughts on Stakeholder Management”
I am very happy to learn that stakeholder management is being given some attention by PR professionals. If stakeholder management approaches are used more often by PR professionals, some of our programmes will be more successful.
This goes to John, what would you say is the role of public relations in stakeholder management in NGO?
your insights are… well… down right insightful. Having spent most of my career in senior marketing positions in major Fortune 500 companies, I am astounded how little my marketing colleagues understand and embrace the concept of stakeholders. It is therefore, no surprise to me why the tenure of CMOs is so short.
Re: Rawlins–This is an interesting paper, but the current town hall debates on healthcare reform show that Grunig’s original taxonomy categorizing stakeholders according to levels of problem recognition and constraint is difficult to apply, at times confusing and often inadequate to describe what is happening in complex situations.
While there is a high degree of “problem” recognition and a low degree of constraint among the publics attending these meetings, the problems are largely manufactured and the participants seem to operating from a very low knowledge base. This suggests that, while they qualify as stakeholders in Grunig’s definition, attendees have clearly been motivated by messages intended to disrupt the progress of healthcare reform legislation. In that sense, they are “publics” in the traditional sense.
Nor do I necessarily agree with the author’s statement, “the public relations profession evolved from journalism.” Public relations evolved from many areas of endeavor, as reflected in the many areas of endeavor it comprises now.
John, it is surprising that companies have not yet completely understood the influence different stakeholders have on the bottom line of an organization. Consider the impact that the lack of company loyalty and commitment of two Domino’s Pizza employees had on brand reputation and sales of their products. Since companies can no longer hope to control information that affects brand and reputation images, it more important now than ever to consider relationships with all key stakeholders.
I agree with you that Brad’s paper is an excellent and very useful guide, and I always use it in my classes on Global Relations and Intercultural Communication at NYU. I constantly refer to it as a seminal perspective with my Italian colleagues when I am home.
I am not that surprised that a global research marketing firm has yet to come to grips with the stakeholder relationship management concept. From my perspective marketing, social and political research firms are in need of a radical rethinking of their business model much more heavily than public relations firms.
Just to name a few issues:
What are they doing to review the concept of representative samples?
What are they doing to appreciate the fact that public opinion is disappearing?
What are they doing to focus on publics’ behaviors rather than opinions given that the two are less and less correlated?
What are they doing to cope with the fact that more and more people are either refusing to answer or simply lying on purpose?
And, as “public relators” and therefore a growing customer group of research firms, what are we doing to make sure that we are not making our own decisions based only or mostly on this flawed information?
Going back to stakeholder relationship management, I think it is mostly our role, and the Institute’s of course, to bridge the gap between theory and practice and to enable our colleagues to be more than just ‘buzz wordish’ about this in their day-to-day activity.
I have just finished writing a chapter on global public relations for John Doorley and Fred Garcia’s new edition of Reputation Management, which is due to appear in January which attempts to articulate a ‘scrap-book’ process approach to stakeholder relationship management, which I consider to be one of the two pillars of 21st century global public relations (the other being the generic principles and specific applications paradigm). If interested you may peruse a draft at http://alturl.com/6fnq.
It is the superficial treatment given to stakeholders (except of course their “king customers” who “are always right”) by the marketing dept that has led to the myopic view of stakeholder relationships.
I gather from the above that you were frustrated by the lack comprehension of what Stakeholder Management is from your audience.
If you have any good friends among these “marketers” I recommend you recommend to the book “Stakeholders: Theory and Practice” by Andrew L. Friedman and Samantha Miles.