After a year of pre-planning and lots of hard work, you’ve finally got the funding your business needs. The money is in your bank and you are ready to invigorate the business and pursue the growth you’ve imagined for so long, but you’re feeling like the road in front of you is less clear than what you’d thought. For so many businesses, when new funding comes along – so often, it solves an immediate need – and there is often a watershed moment for your business to utilise these funds as quickly as necessary, which is great. That’s what it’s intended for. But, at the same time, comes a set of responsibility far greater than the satisfaction of any immediate capital requirement, and that is the need to manage your new shareholders, and stakeholders in the business, effectively. Fortunately, we have been working with businesses in this situation for many years, and as we have done for them, we can help to prepare you for the pre and post funding process, and the responsibilities that accompany. In this blog, we will explore stakeholder expectation, and provide tips on how to increase your confidence in your ability to deliver to them.
What is it?
Stakeholders are any individuals or businesses that are affected, or can affect, a particular element of your business. When it comes to investment, those who have given substantial money and time are those who have the keenest interest in your business growing. Whilst that is totally understandable, keeping everyone happy is often much harder than it sounds. We will elaborate on the main methods of effectively managing your stakeholders, seeing you through to long-term success and long-term relationship.
The process of identifying key stakeholders should take place as early as possible when your business is on the up. The things to consider are interest in your project, proximity to your business, needs and concerns and their expectations of what you are capable of. Carefully mapping who you have to consider in big decisions will allow for a more thoroughly examined process, with less chance of pitfalls regarding stakeholders after it is put in to action. It is also vital to get a broad understanding off all of your staff, suppliers and management team. This analysis of internal stakeholders will allow you to confirm you have the correct resources and committed staff to move forward with your big plans.
Interest and influence
Varying levels of influence will allow you to assess how a particular stakeholder will react or involve themselves with your project team or managers. The level of influence can range from supporting you with positive sentiment to actively arguing against your projects, possibly with other community members. Those with high influence, main investors and managerial assistants, have significant power to alter projects, be it their time frame or even their eventual outcome. Medium level influencers, such as certain investors, have considerable interest in the project but are less able to incite change within a project, and will likely let you take the lead. Lower level influencers have little ability to alter any situations you create, but still have a vested interest in your success.
Similar to mapping your stakeholders, you must assess how certain groups will react to different project decisions and how to avoid entirely preventable negative conversations and scenarios unfolding. A key factor for changes to stakeholder opinion is when the business travels in a direction they were not anticipating. An important way to stop this is by ensuring all stakeholders understand your business plan and how you envision the future to look. Targeted communication, mitigation and outright alternative solutions should be assessed when exploring potential issues within projects. This could include loud construction works, environmental issues, and disruption to local area or changing normal business activities at short notice. The combination of stakeholder mapping and exploration of potential trigger points will prepare you for any future communication issues you may face within projects.
After all of this mapping and exploration of who your stakeholders are, you must create a mitigation plan. This plan showcases what risks you are able to accept, share or avoid in your business and how you plan to reduce the impact of any of these risks. It is important to separate your negotiable and non-negotiable. Small changes to plans or profitability may be acceptable for you to keep your investors and stakeholders happy. Importantly, preparing to find a happy equilibrium when having discussions with concerned stakeholders will ultimately be in your favour, as they are likely to increase their buy-in to future projects and improves the credibility of your management structure.
Remember – your stakeholders are there for a reason. They believe in your business, and want to see you succeed. They, if managed correctly, can become your closest ally when you need it most. Their experience, wisdom and insight can help leverage your business even more. Evaluate ways in which you can leverage the positive perception these stakeholders have of your business and promote their advocacy and confidence towards your projects.
We work with many clients long after they have been awarded their funding, and that is because they recognise their newfound responsibility to be accountable to stakeholders for all their spending, and the growth of you business. Work with us to ensure you stay compliant, deliver more than what is expected by your shareholders and gain the confidence necessary to improve your business’ future.