Staking your claim

by Business Case Studies on Monday 14th December, 2009

Over time, the expectations of the stakeholders of a business may change. Shell, dealing with increasing energy use, is faced with providing for these needs in a responsible way. In its quest to balance the social, economic and environmental impacts of its work, Shell takes into account the needs and expectations of its shareholders, customers, employees, suppliers and society. With society's growing concerns over environmental issues, the company is rising to the challenge of providing the energy required in a way the meets both present and future generations.

Business activity affects many groups and individuals. These stakeholders have different needs. Through making sure the customers' needs are met, a range of other stakeholders can benefit also.

As Simon Cowell's X Factor has just reached its finale, we can consider how the needs of these stakeholders of this phenomenon may have changed. These include, the viewers, those companies adverting during the commercial breaks and the TV company. Unlike many reality TV shows, whose ratings fall over time, this year has been The X Factor's most successful run. It has managed to increase its viewing figures by 2 million per episode compared to last year. It seems, therefore, to be meeting the needs of the consumer. The second stakeholder to consider is the companies adverting during the commercial breaks. Rising figures for the programme benefits those organisations that promote their goods and services. As a result of this, 30 second advertising slots were reportedly being sold for up to £250,000 for the final on Sunday. Advertising and phone voting revenue means that the latest series of The X Factor has generated in the region of £100 million for ITV, another stakeholder of the programme. (The Sunday Times 13th December 2009)

Questions

  1. Define the term stakeholder.
  2. Using the case study explain how the needs of Shell's customers have changed over time.
  3. To what extent have all of The X Factor's stakeholders benefited from its success this year?
  4. What key stakeholder group does the X Factor not mention?

Answers to questions

  1. Define the term stakeholder. A stakeholder is an individual or group with an interest in the decisions made by an organisation.
  2. Using the case study explain how the needs of Shell's customers have changed over time – Greater requirement for energy particularly for transport as people travel more, ncreased concerns about pollution and environmental damage, Desire to use more 'green' fuels e.g. wind powered or bio-fuels.
  3. To what extent have all of The X Factor's stakeholders benefited from its success this year?

On the one hand:

  • Viewers have benefited from the entertainment 
  • ITV has benefited from the revenue generated 
  • Some of the contestants will benefit by having a kick start to their singing careers

However:

  • The BBC has had to compete for viewers e.g. Strictly Come Dancing and the Sports Personality of the Year 
  • Losing contestants – may be difficult for them to return to what they were doing before entering The X Factor

4. What stakeholder group does the X Factor not mention?

  • The contestants

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