If you run a product or service-based brand, it's important for you to complete the main types of documents before you register your business. One of the most crucial documents is a stakeholder analysis.
What Are Stakeholders
A stakeholder is either an individual, company, or association that has an interest in either investing, participating, or supervision your business. Keep in mind that every single stakeholder will play a role in your business and aims to gain from your company.
What is a Stakeholder Analysis?
A stakeholder analysis is basically a strategy to identify who are your stakeholders and analyze their interests and influence on your brand. It's a valuable tool that allows you to understand the requirements and needs of your stakeholders and helps you to prioritize them according to the value, power, interest, and relationship they have with your brand.
What Is The Benefits Of A Stake Holder Analysis?
Effectively performing a stakeholder analysis has many benefits for your business, among them:
- It helps you understand and outline your stake holder's needs so you can be better prepared to address them when the time comes. When you are running a business, you need to minimize surprises as much as possible and be well prepared to tackle issues head-on, and a stakeholder analysis helps you do so.
- Stakeholder analysis helps you lay out your stakeholders according to their priority and influence by identifying the most important ones that you need to focus on first.
- It helps you expand your understanding of not only who your stakeholders are, but also their expectations and concerns that may affect the way you run your business. This is particularly important when it comes to powerful stakeholders that serve as a supervisory role such as licensing organizations and government associations that set rules and standards that need to be followed and updated regularly.
- A great visualization tool that helps you to see how each stakeholder is connected. Perfect for visual learners.
- Great to identify and work on limitations such as licensing, funding, and time constraints.
01. External Stake Holders
An external stakeholder is any individual or organization that is external to your brand and not directly involved in your brand's internal operations.
External stakeholders include:
- pressure groups that can influence the company
- Social media influencers hired to promote products
- Retails stores give products at wholesale prices
02. Internal Stake Holders
Internal stakeholders are any individuals or organizations that directly play a role or influence your brand's products, services, and decisions.
Internal stakeholders include:
- Trade unions
03. Value Exchange
Another great element of a stakeholder analysis is a 'value exchange' in which you analyze what each stakeholder provides for your brand and what value you provide in return, either an exchange of resources, guidance, or services.
This will help you understand which stakeholder is more important and get your expectations clear. From time to time, you would get back to the value-exchange section and see whether the value has been met so you can determine if you still want to maintain your relationship with each stakeholder.
I'll take my skin serum product as an example but this can be applied to any other product-based brand. In the graphic below, I've laid out the value exchange of the stakeholders.
04. Stakeholder Power vs. Interest
Another element of the stakeholder analysis is incorporating a section on the 'power vs. interest' of your stakeholders. This helps you determine which stakeholder has more power and influence on your business and which one needs to be monitored regularly.
The graphic below can be used as a good example to outline what roles each stakeholder plays, and which ones you need to:
- Keep satisfied
- Manage closely
- Monitor with minimum effort
- Keep informed
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About The Author
Noor is a second-year business student at Tredu. She is also studying for Diploma in International Smart Industry at TAMK. She is passionate about marketing and content creation. She recently launched her YouTube channel specializing in holistic healing.
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