In my opinion, organizations should be serving all groups of stakeholders – the shareholders, the employees, the customers, and the community, etc. Starbucks for example, has been successfully positioning itself as the leader in the coffee market by looking after various stakeholder groups. Their success can be seen through their proliferation of coffee shops in the recent years. It is not surprising that you are able to spot their subsidiaries, not only in North America, but also in Japan, Hong Kong, and most other parts of the world. While I was conducted a research on Starbucks for my marketing project, I learned that their mission is to be “the premier purveyor of the finest coffee in the world” (Wong, 2005). Yet, in their mission statement, not only have they valued being able to offer customers a total brand experience and create a good relationship with the employees, they have also emphasized directing the company into a role of being an environmental leader in all facets of its business. For example, they performed sales with a reusable coffee tumbler designed to commemorate the 100th anniversary in 1997 of the YWCA in Vancouver. Besides that, they have also actively supported organizations that benefit children welfare and AIDS outreach. Their customers have felt their philanthropy and this is proven by the statistics, which show that 10 percent of their customers visit the store twice a day and the average customer visits 18 times a month (Wong, 2005). The strength of such customer loyalty is a byproduct of their treatment to their community and environment. With corporate values serving the needs of all groups of stakeholders, Starbucks has succeeded with only a little advertising.
In addition, from the recent stakeholder approach to measuring effectiveness, it has advised us that we should strike a balance between all stakeholders as each organization has many constituencies that have a stake in its outcome. Since each party of stakeholders have an impact on the organization’s performance, it is beneficial to build strong relationships with them. However, each organization has only limited resources and can only focus on a few areas of their business. Diversifying their investments would result in weakening their competitive advantages. Thus, only under this situation, I think that the organization should prioritize serving a certain stakeholder group that will yield the most benefits. In today’s society, I think the most important stakeholder for most organizations is the environment. The reasoning behind that is because nowadays the environmentalists are gaining power. More and more people have grown aware of the organizations’ ethnics and their policies towards the environment. Hence, if organizations could have a more environment-friendly operating strategy, it could help corporations generate more goodwill and thus help attract more customers and make more profits. This way, not only the customers and the shareholders are satisfied, the employees would also be happy since their company is earning money. There are higher chances that they would be rewarded with higher wages, which consequently promote higher morale.
Nonetheless, as the contingency theory has stated that there is always no one best way, it may not be true that giving priority to the environmental group could help achieve organizational goals for some industries. It has to depend on the environments, availability of resources, market trends, and whichever industry the organization is in. Only after careful analysis one will be able to discover who they should really serve.
Reference:
Wong (2005) “Basic Marketing - A Global-Managerial Approach” Eleventh Canadian Edition