Even though the terms stockholders and stakeholders are sometimes used interchangeably, there is quite a distinct difference between the two. It is notable that stockholders are individuals who purchase and own stocks of a respective organization. Stakeholders, however, include employees, suppliers, customers, and other parties involved in the functioning of an organization (Banton, 2021). In management, the stakeholder approach represents the practice of managing parties to develop and implement processes that satisfy the needs of stakeholders to ensure long-term success. The stockholder approach entails the social responsibility of a business to increase its profits. In the context of the United States Federal Government, the stakeholder approach applies because the entity involves the collaboration between different stakeholders while the aim is not always to gain profit.
In the stakeholder approach, the degree of participation among different groups can range, with the organization noting any imperfections to create valuable opportunities for improvement. I agree with the approach because it has allowed to emphasize the active management processes, build meaningful relationships, and promote shared interests (Ramakrishnan, 2019). The stakeholder approach is beneficial because it enables to create a higher-quality workforce, with job satisfaction playing a huge part in the establishment’s ability to foster innovation and new ideas that can benefit the public. Federal government employees who feel satisfied with their work are more likely to be long-term thinkers and generate potentially valuable ideas. All the information that is being generated within such an approach is used for the benefit of everyone in terms of finding new ways of satisfying the needs of the public, which is served by the government and the stakeholders, governmental officials working within it.
References
Banton, C. (2021). Shareholder vs. stakeholder: What’s the difference?
Ramakrishnan, R. (2019). Theories of stakeholder management. SSRN Electronic Journal.