Question

The key point of the question is 6000 traditional bank jobs to go and 2000 new digital position created as NBA aims to move 60 percent of its business online over three years. redundancies are expected to cost up to $800 million. despite record underlying cash profit of $6.6bn, shares fall on cost blow out. Question: Describe the main stakeholders who will be affected by the job cuts? Describe each stakeholder, their concerns and how they are likely to beeffected. Using Stakeholder Theory, explain the likely motivations for the each stakeholder group (basing your discussion on your application of Stakeholder Theory).

Answer 1

Stakeholder theory was first described by Dr. F. Edward Freeman, a professor at the University of Virginia, in his landmark book, “Strategic Management: A Stakeholder Approach.”

Dr. Freeman suggests that a company’s stakeholders are "those groups without whose support the organization would cease to exist."Here are few stakeholders who will get affect as a result of company's decision to digitise:

Employees: Employees are primarily affected as stakeholders in terms of their economic well-being. As a result of digitisation 6000 traditional jobs are lost. Employees are affected by the business decision as this decision affect their job security.

But due to digitisation the new job creation should not be ignored. Employees should be motivated to adapt to the new changes and their brighter prospects in future. For the job losses that could not get avoided. the management should make sure that they do not get any problem during the transitional period (financially).

Shareholders: As a result of fall in share price shareholders get affected. The value of their investment comes down shreholders should be motivated and communicated that the changes that are happening in share price are temporary and the possible changes that digitisation is going to bring in future.

Customers: As a result of ongoing turbulence in the market the customers may feel insecurity. Proper communication should be made on part of company.

Government: These are less important stakeholders but we want to keep on our side. We want to be compliant with regulations and avoid disputes and prosecutions.