United Kingdom

Improving Stakeholder Engagement 

Many organisations and people around the world are increasingly looking to businesses to create a new model of responsible capitalism; where the needs of a wider base of stakeholders are met sustainably both now and in the future.

Few businesses have the depth of understanding of the needs of these stakeholders needed to really address them nor a way of keeping track of them over time. We believe that the successful business of the future that genuinely creates value for itself and its stakeholders will need to work effectively with these stakeholders and invest in those relationships.

 

Even leading businesses, who are committing considerable resources to engaging with stakeholders, often still only focus on the satisfaction of those stakeholders and rely on vague or qualitative descriptions of the needs of the stakeholders. KPMG and that of Relationships Analytics®(RA) have found that conventional stakeholder ‘engagement’ measures satisfaction in a very limited sense. This often gives a general sense of ‘happiness’ but not a deeper understanding of the drivers of that happiness (or not) and where improvements can be made. To complicate matters further, we find that there is often a different perception of the strength of a relationship depending on which side is being asked to comment.

 

Few are able to consider the actual effectiveness of those relationships in delivering mutual benefit through communication, clear understanding and a sense of shared goals. In our view, a business that does not have an effective dialogue with its stakeholders will struggle to meet their needs.


KPMG and RA have worked together to help our clients take a more consistent, unbiased and in depth view of their relationships with key stakeholders. Perhaps most importantly, KPMG has used this approach to help clients understand and influence the drivers of effective relationships with stakeholders to promote better, higher quality dialogue that helps both parties meet their needs.

 

Our approach to measuring the effectiveness of relationships (the Relational Proximity®), is designed to analyse relationships across five drivers, which characterise all relationships whether between organisations or individuals. It is this tool and these drivers that KPMG and RA use to analyse clients’ relationships with their stakeholders and then work with them closely to enhance future performance.

 

KPMG has worked with clients to help them:

 

  • Understand their business critical relationships and identify specific actions that can improve these relationships. By measuring the ‘distance’ in the relationship between two people, groups or organisations, we can determine how well each can understand the intentions and performance of the other.
  • Identify the opportunities for taking greater responsibility in the effectiveness of their relationships – the more remote decision makers from other stakeholders, the less they feel responsible for them. Through greater proximity, groups can understand and interact with each other more effectively.
  • Provide those in a relationship with the language to measure, explore and understand the 20 different drivers that can impact the effectiveness of that relationship.

Case study

Our client is a specialist medical manufacturing business that was moving from a high volume, low margin operating model to one with strategic customers and a focus on R&D led innovation and higher margin products.

 

The business was half way through its transition model with a number of new strategic customers on board but was still reliant on its original customers to provide a stable base revenue.

 

It wanted to understand whether its old customers had been alienated by its change of approach, but also needed to establish if its new strategic partners shared common goals with them and how they could create more aligned approaches.

 

We conducted a detailed analysis of seven of the most important relationships with key external customer groups to understand where the strengths were and where specific aspects of relationships could be made more effective.

 

This gave the business comfort that its historic customer base was still engaged and loyal whilst identifying opportunities to strengthen the relationships with the most important strategic customers further. We created a tangible action plan to support these activities.

 

Relational Proximity® and Relational Proximity Framework™ is a registered trademark of Relational Research Limited and can only be used under license from Relational Analytics Limited.  

 

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Ben Wielgus

Ben Wielgus

Senior Manager

KPMG in the UK

020 7694 8573

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