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The resources of the organisation

Expectations and influence of stakeholders

stakeholder can be defined as someone who has an interest in the well-being of the organisation. A typical list of stakeholders for a large company would include shareholders, employees, managers, customers, locality,suppliers, government and society at large.

Strategic planning and management cannot be achieved without regard to stakeholders.

  • In a profit-making organisation, management might have a choice of adopting a high risk/high return strategy or a low risk/low return strategy. It’s important to know which the shareholders want.
  • In a not-for-profit organisation, such as a hospital, managers need to know what the government and potential patients want. How much resource should go into heart operations, how much into hip replacement, etc.

The beliefs and assumptions within an organisation

Culture affects the interpretation of the environmental and resource influences; so two groups of managers, perhaps working in different divisions of an organisation, may come to different conclusions about strategy, although they are faced with similar environmental and resource implications.

Which influence prevails is likely to depend on which group has the greater power, and understanding this can be of great importance in recognising why an organisation follows, or is likely to follow, the strategy it does.

A consideration of all relevant features

A consideration of the environment, resources, expectations and objectives within the cultural and political framework of the organisation provides the basis for strategic analysis of that organisation.

However, to understand its strategic position, it is also necessary to examine the extent to which the direction and implications of the current strategy and objectives that it is following are in line with, and can cope with, the implications of the strategic analysis