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A PRACTICAL REVIEW OF EFFECTIVE STAKEHOLDER DIALOGUE

Budi Santoso

Dosen PNSD Kopertis Wilayah II Palembang

ABSTRACT

Corporate Communications or Public Relations managers cannot

make organizations more effective unless stakeholder dialogue functions as an integral part of the organizations. This article explains that people who are around and by that, have strong

influence towards the organizations, called stakeholders, should be treated in excellent ways. Dialogue is one ordinary method organizations usually do in dealing with stakeholders,

particularly when the organizations are having problems. It is about communicating with stakeholders in a way that takes serious account of their views. Writer suggests two extensive

ways how to have an outstanding dialogue to reach intended best outcomes, namely, constructing clear messages and identifying the stakeholders themselves. Writer believes that if

organizations know the ins-and-outs of their stakeholders as well as send understandable and unambiguous steps before and when conducting dialogues, first-rate results will be at hands.

Keywords: Corporate Communications, stakeholder, Dialogue

INTRODUCTION

Organization is a medium where many people interact and communicate

in such expected favorable atmosphere, creating and living in a

multifaceted system. An organization also functions as a medium to

gather various clients with different personal purposes and objectives,

even though in general they have the same organizational ones.

Nonetheless, these clients are interrelated to their goals and by that,

interdependence in terms of administrative and production services

provided by the organization.

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Some key factors which have significant influence in an organization are

stakeholders. This terminology has been popular since organizations get to

know that their internal and external publics are very influential.

Professional organizations especially in form of international or

multinational companies usually have a corporate communications

department. Before we continue to discuss about building an effective

dialogue with stakeholders, we should know the basic concept of

stakeholder itself.

WHO ARE STAKEHOLDERS?

Stakeholders can be considered of as any group or individual who can

have effects on, or who can be affected by, a corporation or its routine

activities, particularly related to plans, production, marketing, and

distribution. We can also believe of stakeholders as groups or individuals

who characterize value propositions for the organization and who

consequently must be attended to as part of a sound commercial

approach to building loyalty with customers, employees and investors.

Stakeholders are sometimes divided into (i) primary stakeholders, or those

who have a direct stake in the organization and its success, and (ii)

secondary stakeholders, or those who may be very influential, especially in

questions of reputation, but whose stake is more representational than the

previous one. Secondary stakeholders can also be surrogate

representatives for interests that cannot represent themselves, i.e., the

natural environment or future generations. This should not be assumed to

be a comprehensive or exclusive list. Because of the number and

spectrum of stakeholders, organizations often start by defining a narrow

group of key stakeholders with whom they seek to engage.

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Nevertheless, relationships with stakeholder groups are typically neither

static nor uniform. The map of stakeholders may look dissimilar from issue

to issue, and new stakeholders can emerge on the scene unexpectedly. An

individual or organization may have several different stakeholder

relationships with a company as well as interrelationships with other

stakeholders. Moreover, in a world of networks based on internet

connectivity, alliances between stakeholders in business may grow,

change or fall down with equal rapidity. This is why many leading

businesses focus more on developing the requisite organizational mindsets

and capabilities needed to build trust-based relationships with their

stakeholders than on static mapping of relationships and priorities from

the company’s perspective.

THE BOUNDARY OF STAKEHOLDER DIALOGUE

Dialogue is an exchange of views and opinion to explore different

perspectives, needs and alternatives, with a view to fostering mutual

understanding, trust and cooperation on a strategy or initiative.

Stakeholder dialogue offers a tool to engage people in serious discussion,

and a designed and facilitated process for groups to initiate dialogue with

those persons and institutions that have a stake in their activities.

There are many forms of stakeholder engagement. Dialogue is about

communicating with stakeholders in a way that takes serious account of

their views. It does not mean involving stakeholders in every decision, or

that every stakeholder request will be met. It means that stakeholder

input should be acknowledged and thoughtfully considered. It is about

giving stakeholders a voice, listening to what they have to say, and being

prepared to act or react accordingly. Though dialogues are, in effect,

simply meetings, it is important to remember that they provide a powerful

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tool to listen and learn more about stakeholders. They also offer a

mechanism to share one’s own thinking and to maintain and/or strengthen

relationships.

Today, business has to make decisions in a more demanding and informed

global society. Increasing competition, more domestic and international

pressure to be transparent and changing societal expectations make it

impossible for companies to operate without being in close contact with

those around them. Among companies, there has been a sharp increase in

stakeholder engagement activities as they have come to realize that

people or groups outside the core areas of influence can also be

stakeholders. The traditional circle of stakeholders has expanded.

Previously, the principal groups were shareholders, employees, suppliers,

customers, contractors, authorities, media, the financial and the direct

community. This group has now grown to embrace a wider range of

actors such as youth and religious groups, NGOs, IGOs, global institutions,

and many more (Kluver, 2007). A well planned and designed stakeholder

dialogue should focus on several steps, which are constructing clear

messages, and identifying the stakeholders.

CONSTRUCTING CLEAR MESSAGES

Planning is an unavoidable requirement to obtain effective dialogue and

long-lasting engagement with stakeholders. Planning is not merely about

creating it but also how to maintain it. Be prepared to be as open and

transparent as possible. An organization should identify the problems they

have, analyze their supporting data and inventory resources, as well as

determine their objectives. All those items, then, are formulated to

develop effective messages to be shared with stakeholders. Determining

relevant knowledge and issues that exist at the time the plan is made is

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also important, thus the messages may not be unclear and out of

question.

Communicating issues with stakeholders via dialogue is not a short simple

activity. The organization should think about and prepare the continuity

of the dialogue early. Long-term engagement is needed to establish

deeper relations to them (Curtin and Gaither, 2007). Yet, this needs a

consultation with them on how or if they want to keep communication

after the dialogue is done.

Building engagement through good messages, on my perspective,

demands several things. Firstly, messages that are going to be conveyed

in the dialogue must be constructed as clear and realistic as possible. If

stakeholders do not get the distinct points of the dialogue or if they

assume that the issues are not as important as they think, a dead end

may happen. Therefore, when the process of dialogue is taking place,

openness and transparency of the messages share must put ahead. This

shows that organization favorably respects them and really needs their

inputs.

Secondly, the messages should reflect both organization’s expectations

and stakeholders’ as well. Organization, of course, expects good results or

constructive output from the dialogue, which meets their interests. But

they must not leave the stakeholders’ behind. However, by understanding

stakeholder’s expectation may facilitate organizations to predict some

possibilities that may concur in the dialogue. Making prediction enables

organizations to arrange some back up plans to strengthen their position

in the dialogue. But still, the dialogue should be directed to get a win-win

solution. Thus, stakeholders are not treated as opponents

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Thirdly, messages should be formulated as being flexible and open to

improvising in the program based on stakeholder desire. Flexible does not

mean that organization easily change their plans or decisions. It is more to

adjust favorably the position to the most profitable existing circumstances.

Previous Insightful comments (if any) from involved stakeholders must be

seriously considered as useful input for organization’s needs. And also

important to allow enough time for planning, planning and more planning.

IDENTIFYING STAKEHOLDERS

Organizations, especially the big ones, deal with various stakeholders. This

stakeholder ranges from the most influential to the less ones. As what

Freeman (1984) in Coady (2007) said that investing time and resources in

addressing stakeholders interests is viable managerial activity. This

means that organizations should really pay attention in describing their

relations with stakeholders who relate closely to the problems they are

facing. It is because not all stakeholders will be equally likely to

communicate with or affect the organization (Grunig & Repper, 1992).

However, it is important to know that identifying stakeholders is not as

easy as it might seem. Start thinking about the longer-term engagement

process early and consult your stakeholders on how or if they want

continued communication

Given that stakeholders are various and even multilayer, an organization

should clearly classify their stakeholders’ involvement. Identifying

stakeholders by prioritization may be very useful. This fact requires an

organization to carefully choose them by making priorities according to

their relative importance to the organization (Curtin & Gaither, 2007).

Therefore, knowing the key stakeholders by their involvement to the

issues or problems is a must. What concerns they have and what

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consequences an organization could possibly have on them. Grunig and

Hunt (1984) in Coady (2007) framed a linkage model which is useful to

distinguish different position of stakeholders. This model may be utilized

to assort stakeholders into several segmentations, and thus, easing

organization to prepare good treatment for each. Harrison (1982) in

Grunig and Repper (1992) suggested that practitioners in the

organizations can scan the environment from conducting or using public

opinion polls, studying the mass media and specialized media, reading

scholarly or legal journals to calling on experts in the organization.

Focusing on the quantity of stakeholders is not recommended.

Stakeholders should be invited on the basis of their attributes and ability

to be thought provoking. Categorizing stakeholder’s level of power,

legitimacy, dependency, support or urgency, for example, can give clear

data for organization about stakeholder’s positions. Organizations should

prioritize the most significant stakeholders that hold all the attributes.

Mitchell et al (in Coady, 2007) called them definitive stakeholders. This

kind of stakeholder has power to shape organizations’ decisions as well as

influence others to change their positions.

Besides that, an organization should also take into account the fast

changing of situation and other influential publics that may influence the

stakeholder’s position. Media coverage on social-political issues, for

instance, may possibly intertwine stakeholders’ opinions and attitude.

Stakeholders may support the organization’s plan at first but can

potentially endanger it if they are carried away by and believe in media

analysis. Important to know that media themselves are intervening public

an organization may deal with.

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CONCLUSION

To sum up, I concluded that constructing clear messages and identifying

stakeholders before communicating issues with stakeholders as elaborated

in this paper are very important in achieving effective dialogues. However,

Communicating the issues through dialogue does not mean that an

organization involve the stakeholders in any decisions or meet with their

all requests. It is more about providing them with favorable situation to

get distinct information. But last but not the least, Focus on quality not

quantity. It means that participants should be invited on the basis of their

credibility and ability to be thought provoking

Bibliography

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Relations. The Hague, The Netherlands: The Hague University of Professional

Education.

Grunig, J., & Repper F.C. (1992). Strategic Management, Publics, and Issues? In J.

Grunig (Ed.), Excellence in Public Relations and Communicaition Management.

New Jersey: Lawrence Erlbaum Associates.

Kluver, R. (2007). Globalization, Information, and Intercultural Communication.

Retrieved Januari 22, 2008, from acjournal: www.acjournal.org

Patricia A Curtin, TK Gaither. (2007). International Public Relations: Negotiating

Culture. Identity, and Power. UK: Sage Publications.

WBCSD. 2007. Stakeholder Dialogue: The WBCSD Approach to Engagement retrieved on 23 November 2007 from The World Business Council for Sustainable

Development (WBCSD) Website: http://www.wbcsd.org/DocRoot/sY0gbwlH9OPo3doLXocI/stakeholder.pdf