Tourism Management in in the GMS NovemberDecember November

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Tourism Management in in the GMS November-December November- December 2009, 2006, Cambodia Trevor Sofield

Tourism Management in in the GMS November-December November- December 2009, 2006, Cambodia Trevor Sofield Professor of Tourism University of Tasmania Australia. Consultant : ITC Stakeholder Analysis Maasai market, Nairobi, Kenya (photo: Chris Grandt)

Tourism Management in the GMS November- December 2006, Cambodia Definition of Stakeholders “Any group

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 organisation’s objectives. ” (Freeman, R. E. (1984) Strategic Management: A Stakeholder Approach, Boston: Pitman. ) Developers, businesses, neighbours, communities, government ministries, non-governmental agencies, etc and etc. . . . PHNOM PENH PLAN

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

Stakeholder Analysis Tourism Management in the GMS November- December 2006, Cambodia § Narrow definitions of who is a stakeholder look at direct relevance to the activity’s 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. Vendors, Luang Prabang, Lao PDR Homestay village near My Tho, Vietnam

Tourism Management in in the GMS November-December November- December 2009, 2006, Cambodia Stakeholder Analysis

Tourism Management in in the GMS November-December November- December 2009, 2006, Cambodia Stakeholder Analysis • . . . 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 Levels of importance of stakeholders Primary stakeholder: one who without continuing participation

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 farmer versus absentee landlord) . . . PHNOM PENH PLAN

Functions of Stakeholder Theory (Donaldson and Preston (1994); Jones (1995) Tourism Management in the

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. . . . PHNOM PENH PLAN

Problems with the Concept of Stakeholder Theory Where does tourism begin and end? Tourism

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 doesn’t 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.

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 Doesn’t differentiate between those who own versus those with interest in tourism 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. . . . 7. PHNOM PENH PLAN

A Model for Stakeholder Analysis Tourism Management the GMS Tourism Management inin the GMS

A Model for Stakeholder Analysis Tourism Management the GMS Tourism Management inin the GMS November-December 2009, Cambodia November. December 2006, (Hardy 2001) . . . PHNOM PENH PLAN GROUP 1 N=x GROUP 2 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

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!

Summary Stakeholder analysis assists understanding of tourism as a system encompassing different interests such

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. END