INTD670-1403A-01: Leadership and Ethical Decision-Making
Who are the stakeholders in this situation?
Let’s start with well known Freeman's (1984) definition of stakeholder as "any group or individual who can affect or is affected by the achievement of the organization's objectives" (p. 46). From the corporate point of view there are quite a few stakeholders in this situation: UWEAR, Peninsula Hotel chains, Tom, Bill, Joe, company employees, UWEAR’s competitor THREADS4U, there are also families of company employees. Of course not all the stakeholders are equal, some are primary and some are secondary. And the main of company management is to create a classic “win-win” situation by trying to keep all stakeholders happy. Unfortunately the situation is quite difficult to solve. Joe Smith, a salesperson of UWEAR is desperate to have this year’s contract signed by Peninsula Hotel Chains, because this accounts for 50% of his territory sales. Joe was already under fire last year when he was desperate too and had to give Bill Bateman, a CEO of Peninsula Hotel Chains bottom low prices, which almost got Joe Smith fired. This year it is even tougher since THREADS4U are offering 10% price cut of last year’s prices just to win Peninsula Hotel Chains business back. The decision, action plan and dynamics of what should Joe do next must be done in consideration of stakeholders.
What are the responsibilities of each stakeholder to the company?
Bill Bateman, who is a CEO of Peninsula Hotel Chains has very obvious for CEO responsibilities, that include: maximizing profits, minimizing costs, keeping shareholders happy. As CEO of the company he needs to meet budget numbers assigned to each quarter, as well as annual numbers, otherwise his expertise as CEO is in questions. Of course Bill has to act within company procedures and guidelines established framework, but showing reports to owners/shareholders of the hotel chain with profit numbers growing, possibly more hotels building...