Integration of Total Quality Management into Stakeholder Management Policy and Harmonization of their Interests

Dalia Susnienė, Povilas Vanagas

Abstract


The paper presents the organization as a collaboration of multiple and diverse constituencies and interests, referred to as stakeholders. Stakeholder view of the organization integrates stakeholder relationships within a company’s resource base, industry setting, and sociopolitical arena into a single analytical framework. Although it is not that difficult to envision a stakeholder focus in running a business, it is exceedingly difficult to implement such a focus. The key relationships for a business go far beyond the relationships with its customers to include the relationships with its employees, as well as those with suppliers and partners, investors and market analysts, and even government regulators, trade associations and other entities that influence the general business climate in which a given business operates. The paper introduces an integrated strategy for building a network of collaborative stakeholder relationships based on fundamental shift in management philosophy and attention. Singular needs and interests of stockholders are replaced by a focus on understanding and balancing the interests of all company’s key stakeholders. It is not easy to find mutually beneficial relationship between organization and its stakeholders. Quite often building a network of reciprocal relationships with all stakeholders is not simple. In most companies, competitive pressures keep all eyes focused on the short term goals, making it extremely difficult to bring long-term issues to the forefront. Traditional accounting systems based on financial measures of performance make it difficult to assess the impact of intangibles like relationships or reputation. And collaboration means letting go out of control, which is always difficult for corporate managers schooled in the art of competition. There comes total quality management which can throw the new light on cooperation between stakeholders and organization offering new solutions in harmonization of these relationships. Comparing the characteristics of total quality management it is further deducted that the business aim of long term success will be accomplished if management acts to optimise quality of product and service to customers, subject to meeting the needs and expectations of non-customer stakeholders. Thereby it can be deducted that total quality management focus on customers together with emphasis on employees, suppliers, shareholders and other stakeholders aims to safeguard mutual wealth consequently strengthening the priority of all stakeholders. That means there must be found optimum in quality, when it does not threaten to violate the needs of other stakeholders. From total quality management perspective there are three different concepts on how to satisfy different stakeholder interests: accommodation of interest, alignment of interest and balancing of interest. Establishing ground rules to ensure respectful interpersonal communication helps create a “safe” environment within which individuals feel free to express their views, without fear of “looking stupid”, being criticized, or otherwise sanctioned. Through positive long-term relationships, companies identify “win-winwin” opportunities that serve the corporation as well as stakeholders and society.


Keywords


stakeholders; harmonization of stakeholder needs and interests; total quality management; cooperation; relationships; satisfaction.

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Print ISSN: 1392-2785
Online ISSN: 2029-5839