Developing A Salient Relationship with Stakeholders

Coffee beans - office stimulant

[We’re pleased to welcome Anabella Davila and Christiane Molina of Tecnologico de Monterrey. Anabella and Christiane recently published an article in Business & Society, entitled “From Silent to Salient Stakeholders: A Study of a Coffee Cooperative and the Dynamic of Social Relationships.”]

A less-bureaucratic, hierarchal relationship, that is based on moral commitment to stakeholders, may benefit long-term understanding and solution of stakeholder claims, according to the article “From Silent to Salient Stakeholders: A Study of Coffee Cooperative and the Dynamic of Social Relationships,” published in the journal Business & Society, coauthored by Anabella Davila, a research professor and the leader of the Strategy and Management in Emerging Economies Research Group at EGADE Business School, Tecnologico de Monterrey, Mexico and Christiane Molina, professor at the Undergraduate School of Business, Tecnologico de Monterrey, Mexico State Campus.

This study of an indigenous coffee farmers’ cooperative association, which was once isolated and then began to compete on the fair-trade global market, notes that the “silence” of stakeholders is the result of an unequal relationship that is not focused on satisfying their needs. Since 1940, the Union of Indigenous Communities of the Isthmus Region (UCIRI, in Spanish), made up of small, independent farmers from the Tehuantepec Isthmus region (state of Oaxaca), had worked in government programs that promoted the coffee industry. However, it was not until they created a formal cooperative association in 1983 that UCIRI started to gain salience as a stakeholder of government agencies and fair-trade organizations.

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The study centers on how interactions and relationships are developed between organizations and stakeholders, especially when the stakeholders come from communities at the periphery of society and economic activity. By analyzing data on the UCIRI’s past evolution, the authors found that the unequal, hierarchal, bureaucratic relationship between government agencies and coffee farmers was less effective for understanding and tending to their demands, including better living conditions. As “silent” individuals, small farmers were invisible in the stakeholder network, but when they became part of a formal group, they took their first steps toward “salience.”

In addition, it was thanks to mediation by the Dutchman Francisco VanderHoff Boersma, who had a strong moral commitment to the development of the communities in the region that UCIRI began to develop links with foreign fair-trade organizations and to move toward this market niche in the 1980s. This collaboration allowed the cooperative to export to Europe and the United States and to work with large distributors.

Thus, the authors stress the importance of individual mediators and a moral commitment when building a strong, lasting relationship that allows the demands of marginalized stakeholders to be satisfied. A less bureaucratic, hierarchal relationship—based on a moral commitment to stakeholders—benefits long-term understanding and stability of the relations between stakeholders and the organization.

Besides gaining “salience” within the coffee industry, the UCIRI members were empowered and earned recognition from authorities, becoming an important actor in the promotion of fair trade in Mexico.

The abstract:

Theoretical and empirical research on stakeholder behavior tends to focus on specific actions or responses in the context of the organization–stakeholder relationship. Despite increased efforts to look beyond the dyadic organization–stakeholder relationship, research still favors the perspective of the focal organization. The taken-for-granted assumption of the organization–stakeholder relationship may limit our understanding of how organization–stakeholder linkages are formed and evolve over time. By adopting the perspective of the stakeholder, this article examines organization–stakeholder relationship formation and tracks changes in the salience of stakeholder groups otherwise considered to be nonstakeholders. This research draws from a case study of small coffee producers in Southern Mexico who formed a cooperative and developed salience within their stakeholder network after a long history of diverse individual, organizational, and institutional arrangements. The findings suggest that the replacement of bureaucratic stakeholder relationships (i.e., those based on inequality, transactions, and hierarchy) with relationships characterized by strong moral commitment to stakeholders’ claims (in this case, the improvement of the community’s economic and social welfare) enabled independent farmers to transform into an integrated, solid, and worldwide competitive group of coffee producers.

You can read “From Silent to Salient Stakeholders: A Study of a Coffee Cooperative and the Dynamic of Social Relationships” from Business & Society free for the next two weeks by clicking here.

Want to stay current on all of the latest research from Business & SocietyClick here to sign up for e-alerts! You can also find the journal on Twitterclick here to read through Business & Society‘s latest tweets!

*Coffee image attributed to Lilian Wong (CC)

How Coca-Cola Uses Social Media to Promote Corporate Social Initiatives

19792301106_fa09faba36_zWhat is the most effective way for companies to implement corporate social marketing (CSM)? In the Social Marketing Quarterly article “Examining Public Response to Corporate Social Initiative Types: A Quantitative Content Analysis of Coca-Cola’s Social Media,” authors Lucinda L. Austin and Barbara Miller Gaither suggest that the effectiveness depends upon the the corporate social initiative (CSI) type and the message content more than anything else. The abstract for the paper:

Corporate social initiatives (CSIs) are increasingly important in boosting public acceptance for companies, and emerging research suggests corporate social marketing (CSM) could be Current Issue Coverthe most effective type of CSI. However, scholars caution that CSM is not a one-size-fits-all. Through a content analysis of Coca-Cola’s social media posts on potentially controversial topics related to sustainability, health, and social change, this study explores how CSI type and message content influence public response to an organization’s social media corporate social responsibility posts. Posts emphasizing socially responsible business practices generally received the most favorable public response, while posts focused on cause promotion were received the most negatively. Findings also suggest that CSM is less effective when the issue and advocated behavior change appears to be acting against the company’s interests.

You can read “Examining Public Response to Corporate Social Initiative Types: A Quantitative Content Analysis of Coca-Cola’s Social Media” from Social Marketing Quarterly free for the next two weeks by clicking here. Want to know all about the latest research from Social Marketing Quarterly? Click here to sign up for e-alerts!

*Coca-Cola image attributed to Aranami (CC)

Tweet All About It: Using Twitter as an Inexpensive Communication Tool

Twitter BirdIn recent years, social media has changed the way that companies and customers interact. For many companies, social media platforms like Facebook and Twitter provide new avenues for marketing and customer service interaction at a relatively low-cost. For nonprofits in particular, social media seems to be an effective communication tool to cultivate relationships with stakeholders. In their article, “Twitter as a Communication Tool for Nonprofits: A Study of Sport-for-Development Organizations,” published in Nonprofit and Voluntary Sector Quarterly, Per G. Svensson of Louisiana State University, Tara Q. Mahoney of State University of New York at Cortland, and Marion E. Hambrick of University of Louisville delve into the ways that nonprofits utilize Twitter to reach out to stakeholders. Analyzing the tweets of nonprofit organizations, the authors set out to identify how social media can be used to promote a call for action among stakeholders.NVSQ_72ppiRGB_powerpoint

The abstract:

Previous research suggests sport-for-development organizations strategically aim to engage people through social media in hopes of generating increased offline support (Thorpe & Rinehart, 2013). Using the framework set forth by Lovejoy and Saxton (2012), the purpose of this study was to explore how nonprofit organizations use Twitter to disseminate information, build engagement, and facilitate action. A content analysis of 3,233 tweets revealed a larger proportion of interactive communication, yet one-way communication was the most common function. Overall, the use of social media to facilitate action among stakeholders was scarce, but the way organizations used Twitter to provide information, interact with followers, and create a call for action varied considerably among them. Interestingly, these differences were not associated with annual revenue, organizational age, targeted social issues, or number of countries of operation. This study has important theoretical and practical implications, and provides a first look at how sport-for-development organizations use Twitter.

You can read “Twitter as a Communication Tool for Nonprofits: A Study of Sport-for-Development Organizations” from Nonprofit and Voluntary Sector Quarterly for free by clicking here. Want to know about all the latest research from Nonprofit and Voluntary Sector Quarterly? Click here to sign up for e-alerts!

Environmental Proactivity: An Economic Booster for Firms?

[We’re pleased to welcome Jesús Valero-Gil of University of Zaragoza. Professor O&E_Mar_2012_vol26_no1_Cover_Final.inddValero-Gil co-authored an article with Pilar River-Torres, Concepcion Garces-Ayerbe, and Sabina Scarpellini of University of Zaragoza in the September 2015 issue of Organization & Environment entitled “Pro-Environmental Change and Short- to Mid-Term Economic Performance: The Mediating Effect of Organisational Design Change” .]

 The relationship between environmental proactivity and financial results in firms has been widely studied, and different conclusions have been obtained. Both from a theoretical and an empirical perspective, numerous authors have come to different and opposite results. This phenomenon inspired a new work in the topic. Given this lack of consensus, the idea that the relationship between environmental and financial performance is not as obvious as it might seem arises. The complexity of the relationship between pro-environmental measures and performance, suggesting that there are certain moderating and mediating variables in this relationship.

The abstract:

The aim of this study is to contribute empirically to the understanding of the economic effects of pro-environmental change in firms. First, we analyse whether pro-environmental changes performed in different sections of firms’ value chain (products, processes and supply and distribution channels) generate positive economic returns in the short- to mid-term. Second, we analyse whether measures implemented by firms to improve environmental performance (pro-environmental change) have been complemented with changes in organisational design, and whether these changes help increase short- to mid-term economic performance. Through an analysis of a sample of 303 firms, we have collected empirical evidence that confirms that pro-environmental change improves short- to mid-term business performance both directly and indirectly, through the mediating effect of improvements in organisational design that often go hand in hand with these processes.

You can read “Pro-Environmental Change and Short- to Mid-Term Economic Performance: The Mediating Effect of Organisational Design Change” from Organization & Environment free for the next two weeks by clicking here. Want to know about all the latest research from Organization & Environment? Click here to sign up for e-alerts!

Why Some Corporations Choose To Be Socially Responsible

clean-home-2-1193877-mDo you know what makes your pans non-stick or your toothpaste and hand soap fight bacteria? According to the European Commission Department for Health and Consumers, products like these can contain chemicals such as pesticides that cause cancer, reproductive and developmental issues, endocrine disruption, and environmental issues. While the EU has developed Registration, Evaluation and Authorization of Chemicals (REACH) to address this issue, the United States Government Accountability Office has made no recommendations for creating a similar program. So why would a company then choose to create their own regulations for their products? Authors Caroline E. Scruggs and Harry J. Van Buren III investigate in their article “Why Leading Consumer Product Companies Develop Proactive Chemical Management Strategies” from Business and Society.

The abstract:

Scholars have studied the various pressures that companies face related to socially responsible behavior when stakeholders know the particular social issues under consideration. Many have examined social responsibility in the context of BAS_v50_72ppiRGB_powerpointenvironmental responsibility and the general approaches companies take regarding environmental management. The issue of currently unregulated, but potentially hazardous, chemicals in consumer products is not well understood by the general public, but a number of proactive consumer product companies have voluntarily adopted strategies to minimize use of such chemicals. These companies are exceeding regulatory requirements by restricting from their products chemicals that could harm human or environmental health, despite the fact that these actions are costly. They do not usually advertise the details of their strategies to end consumers. This article uses interviews with senior environmental directors of 20 multinational consumer product companies to investigate why these companies engage in voluntary chemicals management. The authors conclude that the most significant reasons are to achieve a competitive advantage and stay ahead of regulations, manage relationships and maintain legitimacy with stakeholders, and put managerial values into practice. Many of the characteristics related to the case of chemicals management are extendable to other areas of stakeholder management in which risks to stakeholders are either unknown or poorly understood.

Click here to read “Why Leading Consumer Product Companies Develop Proactive Chemical Management Strategies” from Business and Society. This article is Open Access and free for viewing and sharing! Want to know about all the latest research like this from Business and Society? Click here to sign up for e-alerts!

5 Traits of an Effective Executive

What personal qualities are likely to define a successful effective? In a new article published in Compensation & Benefits Review, former Pfizer worldwide head of human resources Bruce R. Ellig explores five key qualities in detail, along with problem areas that negatively impact performance. Here, he describes current challenges facing execs in “The Need to Succeed”:

CBR_42_1_72ppiRGB_150pixWExecutives are subjected to more scrutiny now than in years past due to several well-publicized accounting scandals and the lack of a solid linkage between CEO pay and stock performance. There is also a conviction that the job of the executive today is tougher than it has ever been. Government intervention, shareholder dialogue and the visibility of executive compensation are all becoming more important. Executives realize they must continually prioritize the events affecting them—taking only as much time to analyze the data as is cost-effective, given the problems confronting them. Furthermore, they must be prepared to modify each decision, or alter its impact, as events and additional data make the earlier action inappropriate. Many must continually fight with themselves not to overindulge in an area of their own interest and expertise at the expense of less attractive but more significant issues.

Read the article, “Attracting, Motivating and Retaining Executives: Lessons From Years as an HR Executive,” forthcoming in Compensation & Benefits Review and now available in the journal’s OnlineFirst section.

Do you have a paper to submit? Compensation & Benefits Review is now seeking submissions on executive pay, health care/retirement benefits, high performance work practices, and many more topics. Click here for details and instructions on submitting your paper for publication in the journal.

Mental Weight Lifting for Business Students

If you’ve read the news this week about declining MBA applications, you’ll likely welcome a fresh perspective on business education. Dr. Jennifer Kohn of Drew University, in a new article and corresponding podcast in the Journal of Management Education, draws from a centuries-old text—James Madison’s Federalist #10, a seminal work in political theory—to deliver specific practical lessons for managers. The result is what Dr. Kohn calls “mental weight lifting” for students training for success in today’s competitive business world:

Madison’s first lesson is that in order to identify factions, managers must first determine their organizational objective. This is often easier said than done, both for big picture corporate strategy as well as daily meeting agendas. Second, Madison provides a cogent argument that it is better to manage the effects of factions than to try to prevent their causes. Madison argues that the causes of factions are rooted in the very human nature and freedom that fuels the dynamics of society and business. In other words, hiring “yes men” and severely limiting what employees can do would be like a dictator extinguishing liberty, “. . . a remedy worse than the disease” (p. 55). Madison’s third critical lesson is that managers are not immune to developing adverse interests of their own. So what is a manager to do?

Click here to listen to the interview with Dr. Kohn and here to read the article, “Federalist #10 in Management #101: What Madison Has To Teach Managers,” published on September 17, 2012 in JME. You can also subscribe to the podcast on iTunes.

Jennifer L. Kohn is an Assistant Professor at Drew University.  She brings a combination of business, government and academic experience to her teaching and research.  She is a strong advocate of the Liberal Arts having applied her undergraduate philosophy degree from the University of Massachusetts at Amherst to jobs ranging from campaign manager to consumer advocate to senior administrator for the Division of Cardiology at New York Hospital-Weil Cornell Medical Center.  Jennifer found the philosophy in math earning an MBA in Finance and Statistics from the New York University Stern School of Business and her Ph.D. in Finance and Economics from the Rutgers Business School.  Her research is in applied microeconomics in the fields of health care, risk management and econometrics.

Gordon Meyer is Associate Professor of Management and Chair of the Department of Management and Marketing at Canisius College in Buffalo, NY. He has a masters degree in organizational behavior from Brigham Young University and a Ph.D. from the New York State School of Industrial and Labor Relations at Cornell University. His research interests include management education and pedagogy, and he is an Associate Editor of the Journal of Management Education.