Nonprofit organizations are accountable for many facets of its organization including serving the good of the public, the legal and financial responsibilities, and professional activities (Blaser & McClusky, 2005). Most important of these is stakeholder management. Bourne and Rowlinson (2008) defined stakeholders as.

[The] individuals or groups, who have an interest or some aspect of rights or ownership in the project, can contribute in the form of knowledge or support, or can impact be impacted by, the project, its work or outcomes (p. 3).

In managing stakeholders, nonprofit organizations must interpret and understand stakeholders influence and expectations against the mission and values of the organization (Balser & McClusky, 2005). Van Til (1994) noted that nonprofit organizations find themselves in a complex and competitive environment, and as such, they are accountable to many stakeholders including volunteers, congregants, government officials, funders, board of directors, staff, and directors. This being the case, it is imperative for nonprofit organizations to manage and negotiate their stakeholder relationships (Blaser & McClusky. 2005).

There are advantages to managing stakeholder relationships within organizations (Valdez, 2013). For example, communicating, identifying, and satisfying stakeholder needs leads to increased sales (Valdez, 2013). In like fashion, commitment to stakeholders (employees, for instance) can improve productivity thus reducing absenteeism and decreasing the turnover rate. In the business setting, a lack of stakeholder management can lead to several disadvantages. Lack of communication and uncomplimentary public opinion can become problematic if not detected and managed (Valdez, 2013).

Bourne (2008) noted that stakeholder management is about relationship management. Furthermore, effective management with an organization’s circle of stakeholders is critical to long term wealth, value, and survival (Bourne, 2008). Bourne (2008) puts forth a model that can assist organizations with stakeholder relationship management. This model includes five steps in managing stakeholder relationships; ““Identify, prioritize, visualize, engage, and monitor” (Bourne, 2008, p. 4-6). Through this model, management can provide the level of relationship engagement that can positively influence stakeholders perceptions, what they expect, and how they act (Bourne, 2008).

Crystal J Davis is a servant leader, blogger, and researcher. She holds a Doctorate in Management specializing in Organizational Leadership. Dr. Davis is passionately engaged in Servant Leadership and selfless service to the nonprofit and public sectors having served both large and small organizations throughout her career and her consulting business. Follow her @DrDavis2126 (Twitter), and Lead.From.Within. (Facebook)

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