Tourism

Tourism Management
Management in
in the
the GMS
GMS
November-December
November- December2009,
2006,Cambodia
Cambodia

Trevor Sofield
Professor of Tourism
University of Tasmania
Australia.
Consultant : ITC

Stakeholder Analysis

Tourism Management in the GMS

November- December 2006, Cambodia

Definition of Stakeholders
Any group or individual who can affect or is affected by
the achievement of an organisations objectives.
(Freeman, R.E. (1984) Strategic Management: A Stakeholder Approach,
Boston: Pitman.)

Developers, businesses, neighbours, communities,

government ministries, non-governmental agencies,
etc and etc.

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PHNOM PENH PLAN

Stakeholder Analysis
Tourism Management in the GMS
November- December 2006, Cambodia

Narrow definitions of who

is a stakeholder look at
direct relevance to the
activitys core economic
interest, whereas broad definitions are based
on the premise that
companies and businesses
can be affected by, or can
affect almost anyone.

Mitchell, R.K., Agle, B.R. and Wood, D.J.

(1997) Toward a theory of stakeholder
identification and salience: Defining the
principle of who and what really counts,
Academy of Management Review 22
(4), 853-886.

Tourism
Tourism Management
Management in
in the
the GMS
GMS
November-December
November- December2009,
2006,Cambodia
Cambodia

Stakeholder Analysis

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PHNOM PENH PLAN

Is now a widely accepted part of

the code of corporate ethics
The concept hinges upon the
notion of fairness
Stakeholder management
requires, as its key attribute,
simultaneous attention to the
legitimate interests of all
appropriate stakeholders,
Minorities included, both in
the establishment of
organizational structures and
general policy and case-bycase decision making.
(Donaldson, T. and Preston, L.E. (1995)
The Stakeholder Theory of the
Corporation: Concepts, Evidence and
Implications, Academy of Management
Review 20 (1), 65-91).

Stakeholder Analysis
Tourism
Tourism Management
Management in
in the
the GMS
GMS
November-December
November- December2009,
2006,Cambodia
Cambodia

A diagnostic tool to identify key

stakeholders
clarify their
interests
comprehend their perception of the
problem
specify
their resources (supportive and
destructive)
outline their mandate

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Stakeholder analysis is a continuous

process

PHNOM PENH PLAN

Stakeholder Analysis
Levels of importance of stakeholders
Primary stakeholder: one who without continuing participation the

Secondary stakeholders: ones who influence, affect or are

Tourism Management in the GMS

November- December 2006, Cambodia

business cannot survive or the development/intervention succeed.

influenced by or affected by the business/development initiative but who
are not engaged in transactions with the business/development initiative
and are not essential for its survival
i.e. Those that affect vs those that are affected by.

Active versus passive stakeholders (eg farmers versus absentee

landlord)

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PHNOM PENH PLAN

Stakeholder Analysis
Helpful stakeholders to enlist:
Tourism Management in the GMS
November- December 2006, Cambodia

ADVOCATES Idea creators, designers

CHAMPIONS - to lead the change
SUPPORTERS - critical mass
DECISION MAKERS (to approve the
activation of critical change enablers
policies, funds, people)
OPINION LEADERS - decision-swayers,
special interest groups that sustain peoples
awareness of the need for change (lobby
groups, NGOs, media)

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Functions of Stakeholder Theory

(Donaldson and Preston (1994); Jones (1995)
Tourism Management in the GMS
November- December 2006, Cambodia

Stakeholder theory can also deal with conflicts and

trade-offs. These tend to increase when development
and population growth occurs, which makes resources
more scarce and therefore more highly valued.
This links into sustainable tourism which recognises
that multiple interests must be addressed and that
balances or tradeoffs must occur.

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PHNOM PENH PLAN

Problems with the Concept of Stakeholder Theory

Where does tourism begin and end?

Tourism Management in the GMS

November- December 2006, Cambodia

Involving every stakeholder in discussions

and negotiations can be an expensive task.
The broad definition: any group or individual who can affect or
is affected by the achievement of an
organisations objectives
presents problems as boundaries
become imprecise: a NGO in one country
may claim stakeholder status in another
country
It doesnt always address power relations
Subjectivity of deciding who is a stakeholder
Bringing stakeholders to the same table may
result in more not less conflict.

Benefits of Stakeholder Analysis

Tourism Management in the GMS
November- December 2006, Cambodia

1.
2.
3.
4.
5.
6.

Can improve quality, efficacy and evaluation of policies and

projects
Can improve assessment of social and political impacts of
policies and projects
Allows for differences in opinions to be identified
Doesnt differentiate between those who own versus those with
interest in tourism so does not automatically exclude non-owners
Makes managers responsible for more than profit maximisation
(the triple bottom line)
Its relevance for identifying multiple objectives and concerns (e.g
between economic, social and environmental viewpoints and
between different interests of different stakeholders)
A way in which the need and interests of people who are underrepresented politically and economically can be highlighted.

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7.

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A Model for Stakeholder Analysis

Tourism
Management
the
GMS
Tourism
Management
inin
the
GMS
November-December
2009,Cambodia
Cambodia
NovemberDecember 2006,

(Hardy 2001)

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PHNOM PENH PLAN

GROUP 1

N=x
GROUP 2

N=x

N=x

GROUP 4
GROUP 3

N=x

any boundary
(indicative diagram only. There could be
many more arrows representing many
more relationships)

A general model for

Stakeholder Analysis,
applicable at any scale.
Multiple arrows represent
interactions, reactions
and feedback between
stakeholder groups.
N represents the number
of different stakeholders
that may exist within any
stakeholder group.
The outer circle
represents any boundary regional, local or state.

A Model for Stakeholder Analysis

Tourism Management in the GMS
November- December 2006, Cambodia

(Hardy 2001)
What do we mean when we say a stakeholder group is mixed?

GROUP 1;
Accommodation
Sector

N=8

Suppose Group 1 represents the accommodation sector, there

may be two 4-5 star hotels, an eco-lodge, a backpacker lodge,
an airport transit motel, a tented safari camp, and 2
community home-stay lodges (N=8).
Some of their objectives and interests will be VERY different
and they may experience greater difficulty agreeing among
one another than with representatives from other groups of
stakeholders.

N=5

GROUP 3
COMMUNITY

Suppose Group 3 represents the community sector, there may

be farmers, landless peasants, small stallholders, and homestay lodge owners. As with other groups of stakeholders,
within this group there will be different interests and
objectives. Note that the home stay lodge owners can be
located in two different groups, and their interests within the
two groups may not be identical!

Tourism Management in the GMS

November- December 2006, Cambodia

Strategic Analysis of Stakeholders

Assess:
Interests, aspirations (share the vision?)
Problem perception (each one sees different
aspects of the same problem which aspect?)
Resources (capable and motivated to participate
and contribute?)
Roles. Ways to enlist participation in the project
(How to involve them in the project so that
envisioned changes can happen?)

Summary
Stakeholder analysis assists understanding of tourism as a
system encompassing different interests such as
environmental, financial, community and tourists
satisfaction interests.
It is therefore an appropriate tourism planning method to
identify multiple objectives as it presumes no one stake
predominates.
However it raises the issue of: Where do stakeholders start
and end?

Tourism Management in the GMS

November- December 2006, Cambodia

Stakeholder management is a methodology within which

sustainable tourism development can be delivered.
It is an essential component of Value Chain Analysis
where stakeholders and their interests must be identified,
and partnerships between them forged to maximize
poverty alleviation.

Stakeholder Table: Public Transport example

Stakeholder
Interests
Problem
Resources
Role /
Perception
Mandate
Many delays
Frequent bus
breakdowns
Frequent
accidents
Impolite drivers
Dangerous
driving

Willingness
to pay for
improved
services

Private Car
owners

No traffic
jams and
safe roads

Too many
accidents
caused by
buses

May consider Not

use of public applicable
transport if
reliable and
safe

Mayor of
Port
Rarorialofa

Reliable, lowcost public

transport
system

Citizen
complaints
about public
transport system
Increased traffic
jams

Veto power
in Council
Commands
popular
support

Car emissions,
obese people

5,000 members To lobby Mayor

Tourism Management in the GMS

November- December 2006, Cambodia

Passengers Safe,

reliable, and
reasonable
public
transport

Bicycle Power Reducing pollution

For the Future for healthy living

Not
applicable

To manage
City of Port
Rarorialofa

and change
public opinion

Tourism Management in the GMS

November- December 2006, Cambodia

EXERCISE
Identify 4 stakeholders involved in the
Kokoda Track tour

Groups Interests

Problem Resources
Role /
Perception
Mandate

1.
2.
3.
4.

END