How Primary Stakeholders Help Build Resilient Organizations
Why is it that some organizations fall apart through disruption, while others seem to weather change after change, bouncing back stronger than ever?
Mostly, it comes down to organizational resilience. Some organizations are better positioned to adapt, persevere, and grow through uncertainty, like global crises, regulatory changes, and economic shifts. A lot of this comes down to factors like strong leadership, company culture, adaptation capacity, awareness, learning, alignment, and capabilities. But one aspect of resilience that’s often overlooked is an organization’s stakeholders.
In particular, primary stakeholders (the individuals or groups directly involved in or impacted by your work) can play a crucial role in building your organization’s resilience by providing essential support, resources, and knowledge.
So, we’ve put together some practical insights and strategies that’ll help you make a case for proactively engaging with primary stakeholders to help increase organizational resilience. But first, let’s start with a clear definition.
What Is Organizational Resilience?
Organizational resilience refers to an organization’s ability to adapt, recover, and thrive in the face of disruptions or challenges. Resilient organizations are generally prepared for a variety of potential events, but they’re also ready to respond quickly when unexpected issues arise.
In larger companies, there’s often more resources and capabilities to get them through tough times, but typically, these companies find it trickier to adapt quickly to change. And the opposite is usually true for smaller companies.
Regardless of company size, resilience is a dynamic trait that can change along with an organization and its external environment, so it’s something that requires ongoing effort.
While leaders are typically responsible for resilience, it can impact most roles in some way. It intersects with risk management, change management, organizational culture, business continuity, crisis management, and stakeholder engagement.
We’ve seen plenty of examples of organizational resilience over the last few years, thanks to a global pandemic, various supply chain disruptions, economic issues, and regional conflicts. Many organizations have successfully navigated major disruptions and challenges with the support of primary stakeholders.
One example of this is Unilever, a global consumer goods company that was significantly impacted by the COVID-19 pandemic, with their food solutions unit losing 70% of business overnight due to restaurant closures. Their employees worked together to quickly come up with new strategies to better meet changing requirements and accelerate digital transformation. They also made it clear through their messaging and actions that the business was “in it together” with their customers. Without this intentional stakeholder engagement, Unilever would have found it much harder to adapt and recover, and likely would have faced worse outcomes for their food solutions business (and its stakeholders).
How Primary Stakeholders Help Build Resilient Organizations
So, what role do primary stakeholder groups and individuals play in organizational resilience?
First: what are primary stakeholders? You may have come across the concept of primary vs secondary stakeholders when discussing how to classify your stakeholders. Your primary stakeholders are the people, groups, or companies that are likely to experience a direct impact from your project or work. Secondary stakeholders are less directly involved — though they may still experience some impacts by being connected to a primary stakeholder (like their workplace or a family member).
Due to their direct involvement, primary stakeholders are more likely to contribute to resilience by offering insights, providing support through challenges, and positively influencing reputation. To understand how they do it, let’s break each of these factors down.
Insights and Expertise
One of the major reasons to consult your primary stakeholders on a project is to tap into the insights that only they have. These insights can highlight potential risks and opportunities that help your organization anticipate and adapt to changes. After all, a large part of your organization’s resilience will come from good risk management — and that can only come from stakeholder involvement.
| For example, many Southeast Asian electronics manufacturers producing components for global tech companies would have dealt with multiple threats in recent years, including geopolitical tensions threatening trade routes, rising energy costs, and skilled labor shortages. If these manufacturers leveraged primary stakeholder expertise (rather than relying solely on internal analysis), they might have uncovered opportunities and risks they could take action on to avoid disaster and emerge stronger.
Insights and ideas like:
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Support During Uncertainty
When times get tough, who are you going to call on? Perhaps a few of your primary stakeholders are already coming to mind. That’s because certain individuals, groups, and organizations can play an important role in providing resources, guidance, and advocacy that will help you navigate a crisis and stay operational.
Examples of this include:
- Partnerships: A local council might partner with various businesses in the region to provide additional support, vehicles, and supplies in the event of a natural disaster.
- Advice: A hospital or health network might reach out to local universities for advice on how to handle a new disease or significant outbreak to ensure they get the best outcomes for patients and avoid spreading further illness.
- Advocacy: A school may reach out to key and leaders in the community for help with advocating for funding, policy change, or a new development to better support their students.
Remember: in every relationship, there’s give and take. So, make sure you invest in building strong stakeholder relationships early on, actively engage your stakeholders, and offer value to your primary stakeholders. Then if/when the time comes, you can confidently call on your key partners or collaborators for advocacy and support.
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Improving Your Reputation
When your organization is under the spotlight and facing public scrutiny, it can be difficult to advocate for or defend yourself. But if someone with an outsider perspective, like a primary stakeholder, is willing to defend you, this can significantly sway public opinion — especially if that group or individual is trusted within the community.
By building strong relationships with your primary stakeholders, you can build valuable social capital in the form of people and groups who will help to protect and defend your reputation when it matters most.
Strategies to Engage Primary Stakeholders for Resilience
So, how do you actually engage primary stakeholders in a way that will maximize organizational resilience? We’ve found there are four main strategies that any organization can implement — especially with the support of a system like Simply Stakeholders.
Proactive Engagement
A resilient organization is a proactive one, and the sooner you can identify and address potential risks and opportunities, the better. So, don’t wait for your stakeholders to come to you with update requests, issues, or project input. Instead, take a proactive approach and engage your stakeholders early on — especially when it comes to your primary stakeholders who may be associated with higher risk.
Actionable tip: Develop an engagement plan that includes regular check-ins and opportunities to provide feedback. Prioritize resources by engaging primary stakeholders early on, while providing passive opportunities for secondary stakeholders to get involved.
Transparent Communication
During crises or times of uncertainty, organizational leaders often need to make quick decisions and work with primary stakeholders to minimise potential impacts and disruptions. This works best when you’ve prioritized open, transparent communication with your stakeholders, because this leads to greater trust, fewer misunderstandings, easier collaboration, and a culture of sharing ideas, information, and resources.
Actionable Tip: Use stakeholder tools like the Stakeholder Communication Matrix to guide your interactions and ensure you reach the right people with the right information at the right time.
Feedback Integration
Both primary and secondary stakeholders can be a valuable source of feedback. After all, if you can tap into more perspectives and insights, you can:
- Make your decision-making processes more inclusive
- Increase confidence in your decisions
- Pick up on more risks or threats before they become a problem
Consider additional ways you can gather stakeholder feedback and take action on it by embedding feedback into your decision-making processes.
Actionable Tip: Use surveys, meetings, and digital platforms to gather input from stakeholders and incorporate it into your strategies.
Long-Term Relationship Building
Long-term, collaborative relationships are key to enhancing resilience. When you build strong relationships with your primary stakeholders, they’re more likely to:
- Place their trust in you
- Engage and collaborate with you
- Share expertise, feedback, ideas, and resources
- Communicate issues and concerns
- Support your projects and activities
- Remain loyal, even through challenges
- Share positive word-of-mouth recommendations
Actionable Tip: Use tools like stakeholder mapping to visualize relationships, strategically build your relationships, and measure indicators of relationship health, like interaction frequency and sentiment.
Measuring the Impact of Stakeholder Engagement on Resilience
In general, effective stakeholder engagement will positively contribute to organizational resilience by helping you build trust, mitigate risks, optimize resource allocation, and other benefits.
But a generalized list of benefits may not be enough to convince your organization’s decision-makers that it’s worth investing more time and resources into stakeholder engagement initiatives and tools.
You’ll likely need to measure the impact of your current stakeholder engagement methods in order to justify continued investment. And if you’re only just starting with stakeholder engagement, you’ll need to set some realistic KPIs upfront to demonstrate the value you expect it to deliver.
But if you can tie realistic engagement outcomes to greater resilience, it’s possible to assign real dollar values to the work you’re doing. For example, if you consistently engage with primary stakeholders every month, you might expect these stakeholders to respond 20% faster during a crisis so that you can make decisions and tap into important resources very quickly. You might also discover major issues weeks or months earlier by regularly asking your stakeholders for feedback. Depending on your organization and scale of the crisis or issue, a faster response could help prevent millions of dollars in losses.
Key Metrics to Track
The metrics you need to track will depend on your organization and specific goals for engagement. But if organizational resilience is one of your main reasons for engaging stakeholders, relevant performance indicators may include:
- Stakeholder satisfaction: Satisfaction scores like Net Promoter Score (NPS) and stakeholder sentiment can be useful indicators
- Engagement: Consider metrics like engagement percentages, engagement patterns, level of engagement, retention rates over time, and how feedback is being used
- Stakeholder insights: Track the number and quality of new ideas and opportunities uncovered through stakeholders, and the number of new risks identified by stakeholders (and the likelihood/impact of those risks)
- Issues discussed: Track what issues are coming up in feedback/comments and the depth of those discussions
- Stakeholder mapping dimensions: Track stakeholder mapping metrics like the level of influence, impact, interest, criticality, effort, and position (and how these are changing over time)
- Pre-crisis evaluation: Run surveys to see how stakeholders rate the organization’s ability to adapt to and recover from various potential challenges or events that may arise
- Post-crisis evaluation: Run surveys to see how stakeholders rate the organization’s handling and adaptability after a recent challenge or event
- Relationship health: Track the number of stakeholder relationships, types of relationships, and whether they’re getting stronger or weaker over time
In addition to the above metrics, ROI is another important success indicator. As we mentioned previously, you’ll find it much easier to justify further investment in stakeholder engagement if you can show real or feasible evidence that your activities are saving time, saving money, reducing costly risks, increasing sales, boosting shareholder value, retaining talent, and tapping into costly resources and opportunities you’d otherwise miss out on.
Engage Primary Stakeholders with Simply Stakeholders
It’s clear that primary stakeholders have an important role to play in organizational resilience — and that engaging them effectively is the best way to open up communication lines, build trust, and encourage collaboration.
Resilience isn’t something you can build on your own (or overnight). It requires a long-term investment in your relationships and shared commitments between your organization and its stakeholders.
Ready to make that investment? Start to uncover the real (and future potential) impact of your engagement and how it relates to resilience factors like primary stakeholder relationships, risk management, collaboration, and resource-sharing. Then evaluate your current practices (like analysis, mapping, feedback, and reporting) so you can find better ways to engage stakeholders and increase organizational resilience.
