5 Key Stakeholder Groups and How to Engage Them Effectively

Need to identify your stakeholder groups and tailor your engagement to their needs, expectations, and preferences?

Identifying stakeholder groups is an important part of stakeholder classification, and a key part of the stakeholder planning process.

A stakeholder group refers to stakeholders that have similar roles or characteristics. Although you’ll engage with key stakeholders individually, you’ll also need to group your stakeholders based on their main role or relationship with your organization or project in order to efficiently and effectively engage with them.

There are many types of stakeholders that could be impacted by, have an influence on, or an interest in your project, organization, or work — both internal and external stakeholders. But most organizations will find they need to focus their efforts on the three, four, or five stakeholder groups that are most critical to the project or engagement.

In this guide, we’ll unpack five stakeholder groups that are most commonly referenced in stakeholder planning: investors, suppliers, customers, employees, and communities. We’ll expand on their role and importance, share examples, and discuss which engagement strategies tend to work best with each group.

So, if you’re looking to identify stakeholder groups, improve your stakeholder engagement, or get a headstart on a planned consultation, this guide is a great place to start.

1. Investor

Investors play an important role for many organizations and projects because they provide the necessary capital (an essential resource!) to start new projects or grow the business. This stakeholder group tends to be most concerned about risk, project/business performance, and external market forces. They may have some influence over company decisions via governance or voting rights, and may be able to provide strategic guidance or expertise. In particular, those investors that hold a stake in multiple entities may be able to provide a wealth of experience and diverse perspectives that help to guide strategies and inform decision-making.

Study: The Impact of Shareholder Engagement

This study looked at the extractive industry sector and the importance of shareholder engagement in a space where there are significant social and environmental impacts, and high financial and reputational risks. They found that companies were using shareholder engagement to implement, monitor, and advise companies on environmental, social, and governance standards, with investors able to influence the process through their knowledge, legitimacy, and pragmatic approach.

Investor Engagement Strategies

When tailoring your approach to engage your investors, consider the following strategies:

• Transparent Communication: Regularly update your investors via investor meetings, financial reports, stakeholder reports, and newsletters
• Gathering Feedback: Use surveys, consultations, and workshops to gather insights from your investors and ensure stakeholder alignment
• Advisory Boards: Establish advisory boards that involve your investors in any strategic decision-making

2. Suppliers & Vendors

As a stakeholder group, your suppliers and vendors can have a significant impact on your project, product, or service delivery. They provide the raw materials or services you need to operate, and carefully managing your supplier relationships will be key to managing risk, maintaining quality, protecting your reputation, and meeting your commitments as a business. You and your suppliers will need to discuss and negotiate costs to ensure profitability and financial stability for both parties, and collaborate on issues like sustainability, quality control, and schedules.

Study: Supplier Engagement for Sustainable Innovation

This study looked at how suppliers can help stimulate innovation for SMEs and become a valuable partner in the sustainable innovation process. By engaging and collaborating with suppliers to exchange information, best practices, and experiences, organizations could enjoy benefits such as operational cost savings, uncovering additional partnership opportunities, and finding better ways to meet emerging concerns of consumers.

Supplier Engagement Strategies

To effectively engage vendors and suppliers, you’ll likely benefit from the following strategies:

• Collaborative Initiatives: Work together on projects or programs, such as supplier development programs, innovations, or joint sustainability projects
• Ethical Practices: Implement ethical work practices, encourage transparency in your transactions (including further up the supply chain), and ensure fair trade practices
• Structured Communication: Develop processes for clear communication, like a Supplier Engagement Plan (SEP) that will support ongoing data gathering, evaluation, and feedback

3. Customers

Any business that sells products or services to customers should consider the importance of this stakeholder group. Even if they don’t directly influence your projects or products, your decisions may still have a significant impact on customers. That said, customer revenue will certainly impact the financial health of your organization, and your customers’ experiences, opinions, and choices can influence your brand’s reputation in the marketplace. When you treat your customers as stakeholders, they can become a valuable source of feedback that drives innovation, helps your company achieve sustainable growth, and gives you a competitive advantage. 

Case Study: Interviewing Customers to Understand Priorities

In this case study, researchers looked at the expectations of customers as a stakeholder of an agricultural enterprise. Customers were interviewed to understand what criteria they used to select agricultural product suppliers. Then researchers used questionnaires to group the criteria and order them by importance, with criteria including freshness, flavor, price, and product appearance. By viewing their customers as stakeholders, the company could identify key issues impacting customer satisfaction and loyalty — and dedicate resources to improving these specific areas. Nearly any type of business could undertake a similar research approach to discover the preferences and needs of their own customers as stakeholders, and use this to influence their decision-making, improve product/service quality, and increase their revenue as a result.

Customer Engagement Strategies

Popular strategies for engaging your customer stakeholder group include:

• Personalization: Engage with specific customers to better understand specific customer needs and preferences, so that you can personalize your marketing and target your campaigns (this is one of those situations where stakeholder systems and CRMs will both come in handy!)
• Implement Feedback Channels: Regularly gather insights from customers via surveys, focus groups, and customer satisfaction tools (put some of these feedback mechanisms on autopilot so that they’re automatically triggered based on purchase activity)
• Customer-Centric Design: Don’t just gather feedback from your customer stakeholders — take action by developing products and services based on your insights into customer values and expectations

4. Employees

Employees are a key stakeholder group for any organization — no matter how big or small. Without the support of these internal stakeholders, your operations would quickly grind to a halt, especially when you rely on certain employees for specific knowledge and skills. Plus, because your employees are typically the direct point of contact with customers, they can have a significant influence on customer satisfaction, revenue, and how your brand is perceived. Employee feedback can deliver innovative ideas that boost performance and help your organization adapt to changing conditions. And strategically building relationships with employee stakeholders can help keep your workforce aligned, your company culture healthy, and your team onboard with any necessary change. 

Important note: employee stakeholder engagement is not the same as a typical “employee engagement program”, although there may be some crossover between the two. Employee engagement refers to how interested or motivated an employee feels towards their work, organization, or environment. But engaging your employees as stakeholders means consulting them about changes that may impact them, considering their perspectives and needs as stakeholders, and working to increase their buy-in or support for projects or initiatives.

Case Study: Improved Employee Performance and Engagement Despite Significant Change

In this case study, researchers looked at the impacts of the Toyota Australia plant closure on stakeholders — in particular, the local workforce. Toyota took a respectful approach towards closing its Melbourne assembly operations, generously allocating resources to prepare their workforce to transition to post-closure work and life. Over a four-year transition process, they saw improvements to employee performance and engagement, which suggests that this approach was effective in fostering employee goodwill and moderating the negative impacts of an impending closure. It shows that applying stakeholder theory to manage employees and guide leadership actions can have significant positive outcomes, even during periods of significant change in the workplace.

Employee Engagement Strategies

Some of our favorite approaches for engaging employee stakeholders include:

• Regular Updates: Keep your employees up-to-date on any projects, workplace changes, and opportunities to get involved
• Two-Way Communication: Establish communication channels where employees can share ideas, provide feedback, and voice their concerns
• Professional Development: Help your employees benefit from (and get excited about!) workplace changes that impact them by offering relevant training opportunities and career mentorship programs

5. Communities

The community stakeholder group typically refers to a group of people with a common geography (neighborhood, suburb, region, state, or country), although it can also refer to a community of shared interest (such as needs, abilities, religion, hobbies, values, customs). Nearly every location-focused project and organization should consider the local community as a key stakeholder group. These organizations will need to conduct appropriate community engagement to understand impacts, increase social acceptance, ensure corporate social responsibility, achieve sustainable outcomes, and maintain a social license to operate. In some cases, the community may also control access to critical natural resources or infrastructure, they may form part of your workforce (and maybe even your customer base), and many of them will hold concerns about environmental, economic, and social impacts. 

Case Study: Tailored Community Engagement Strategies for Clinical Trial Recruitment

In this case study, community engagement strategies were used to enhance the recruitment and retention of African American Women in a clinical trial study. The study team implemented key recommendations, including convening a community engagement studio, redesigning the recruitment advertisement, simplifying their language, and providing participant transportation. These changes enabled them to increase enrolment by 78% and meet recruitment goals 16 months ahead of schedule, while retaining 100% of participants. This shows how a clear understanding of the target community and implementing tailored engagement strategies can have a significant impact on project outcomes.

Community Engagement Strategies

We recommend starting with the following local community engagement strategies:

• Volunteer Programs: Set up opportunities for employees and internal stakeholders to participate in community service, build genuine connections, and give back to the local community in a meaningful way
• Sustainable Initiatives: Show local communities that you share their concerns by using your stakeholder engagement approach to support sustainability measures such as implementing environmentally responsible practices and transparently reporting on your impact
• Develop Local Partnerships: Actively seek out existing local organizations to collaborate with, providing them resources to address community needs and drive positive change

Managing Stakeholder Groups With Simply Stakeholders

Identifying and managing each of your stakeholder groups effectively will likely be critical to the success of your organization or project. It can allow you to tap into essential resources for your business operations, manage risks, get innovative feedback and ideas, boost sustainability, manage your impacts, and so much more.

We’ve only looked at five examples of key stakeholder groups here, but it’s already clear that different types of stakeholders will require different approaches to manage and engage them effectively.

Looking for an easier way to manage stakeholder groups? Check out Simply Stakeholders! Our stakeholder management platform includes practical features that help you separate your contact lists into segments for targeted communication, feedback gathering, and analysis. Plus, so much more. 

Explore our solutions for more effective stakeholder management or reach out to the team to book a demo.