Page 5: Stakeholder conflict
Different groups of stakeholders can have conflicting interests. Here are four examples of potential conflicts involving BT stakeholders:
- As part of its Next Generation Access programme, the company needs to install new optical fibre cables to be able to provide super-fast broadband services across the country. This may be welcomed by customers, who will get a better service, but may cause disruption and traffic delays due to roadworks while the cables are being laid.
- BT's investment in community activities might be contentious. Some shareholders may object to the company investing in activities that will not contribute directly to profits.
- Another potential clash results from BT's pricing policy. Customers naturally want low prices, but shareholders may feel that higher prices would generate greater profits.
- BT has a policy of no compulsory redundancies. This provides security for employees. However, shareholders may feel that the policy could adversely affect the company’s profitability and performance.
Directors and managers at BT must try to manage these conflicts in a way that keeps stakeholders happy. This often involves finding a solution that strikes a balance between competing interests. On occasion, it will not be possible to satisfy everyone. At least one of the stakeholder groups will feel that they are losing out. However, good decision-making involves keeping all parties happy with the outcome.