The power and interest of your stakeholders

By - Olivier
24 Nov 2022 12:03

Stakeholder mapping and how stakeholders impact on your business

The objective of all corporate activities is ought to be the maximization of shareholders’ wealth [Shareholders’ Wealth Maximization principle (SWM)]. Managers and directors need to consider risks and make influential short-term decisions to reach long term goals and ultimately increase the company’s share value.

However, business operations are influenced by many stakeholders which all have different levels of power over the business and levels of interest in the organization. 

On one hand, the power of stakeholders is defined as the ability to influence the business strategy. They have an active participation in the company and are regularly consulted. On the other hand, the interest of a stakeholders is how concerned they are about the success of the organization. 

To ensure that resources are used efficiently, management will need to understand each stakeholder’s position and analyze their influence over the business. This can be done using the grid below:

(Mendelow, 1991)

1)    Minimal Efforts [Low power, Low interest]

Low to no level of engagement is needed by the company with stakeholders that have low power to influence the business strategy and low interest. No excessive communication is needed.


2)    Keep Satisfied [High power, Low interest]

The stakeholders that have high power to influence the business strategy but low interest need to be treated with care and pleased with the company’s performance. The line between satisfaction and boredom is small and therefore, your message should be delivered to them but not in excess.


3)    Keep Informed [Low power, High interest]

The stakeholders that have low power to influence the strategy but high interest are important for the good running of operations. These stakeholders need to be adequately informed and discussions are required to understand if any major issues are arising or potential improvement areas. The strategy must also be acceptable to them.


4)    Key Players [High power, High interest]

Stakeholders with high power and high interest need to be managed closely. It is important to engage with them and make substantial efforts to keep them satisfy. Their views are essential and their participation is required.


Stakeholder mapping can be challenging as it does not take into account the legitimacy of each stakeholder and potential change of circumstances that would affect levels of power and / or interest.

BYRD Consulting can help you understand your stakeholders’ position and ensure the necessary resources are attributed to each.