Theories of Management
The two theories comprising the dual theory of management are:
What are the ownership theory and the stakeholder theory?
Government officials are (normally) this kind of stakeholder.
What is external and non-market stakeholder?
What is a stakeholder analysis?
What is the process of identifying relevant stakeholders and understanding both their interests and the power they may have to assert those interests?
What is attention?
The external environment of business is ____ and _______.
What is dynamic and ever-changing?
The ownership theory explains the role of the corporation is to:
What is to maximize long-term market value and earnings for shareholders with the only social responsibility of the corporation being to maximize their profits?
What is the difference between a stakeholder and a stockholder?
What is:
Stakeholder: persons and groups that affect, or affected by, an organization's decisions, policies, and operations
Stockholder: individuals or organizations that own shares of a company's stocks (one kind of stakeholder)
What are the three determinants of stakeholder salience?
What are power, legitimacy, and urgency?
What drives business success?
What is value creation for ALL stakeholders?
The stakeholder theory explains the role of the corporation is to:
What is to create value for society by considering all groups and individuals that are influenced by the decisions of the firm?
Provide 3 examples of external, market stakeholders.
What are:
Stockholders, Customers, Creditors, Suppliers, Wholesalers and Retailers
The intersection of keep satisfied is made up of those who possess ____ power and ____ interest.
What is high power, low interest?
What is the extent to which a stakeholder's actions are seen as proper or appropriate by the broader society?
Name three of the forces that shape the business and society relationship.
changing societal expectations, growing emphasis on ethical values, explosion of new technology, globalization, evolving government regulation of business, dynamic natural environment
Explain the three main arguments for the stakeholder theory.
What is:
Descriptive argument: Managers must maintain other aspects, rather than strictly financial roles, of the business to ensure consistent results
Instrumental Argument: Companies that consider all stakeholder groups, like employees, customers, and communities, perform better financially
Normative Argument: All stakeholders that contribute any value to the firm have a moral right to some of the firm’s rewards
What is:
Example answer: The government investing in several banks during the financial crisis of 2008, becoming a shareholder of these firms and moving from an external, nonmarket stakeholder to an external, market one.
Explain the nature of interest and the nature of power for employees of a company.
What is:
Interest: maintain a stable employment in firm, receive fair pay for work, work in safe, comfortable environment
Power: union bargaining power, work actions or strikes, publicity
What is the explosion of new technology?
The pharmaceutical company Novartis states it "places a premium on dealing fairly with employees, commercial partners, government authorities, and the public and the success in its business ventures depends upon maintaining the trust of these essential stakeholders". What theory of management does Norvatis follow?
What is the Stakeholder Theory of the firm?
Provide an example of a person playing multiple stakeholder roles at once.
A person who may work at a company but also live in the surrounding community, own shares of the company stock, or purchase the company's products.
Provide a real-world example of a coalition being used to enhance stakeholder power and influence on an issue.
What is:
Example answer: Critics of a Mitsubishi salt plant in Mexico using the internet and media to mobilize over 50 organizations worldwide to pose a boycott of the company and cancel the plans of the plant.
How might managers utilize a stakeholder map?
What is to see quickly how stakeholders feel about an issue and whether salient stakeholders ted to be in favor or opposed?
How might various forces of the dynamic environment of business affect a fast fashion brand, such as Shein?
What is:
Example answer: Growing emphasis on ethical reasoning and actions:
Consumers are increasingly prioritizing sustainability and ethical production. Fast fashion is often criticized for its environmental impact and exploitative labor practices. Social media activism amplifies these concerns, potentially leading to boycotts and reputational damage.