The idea that business organisations have a range of stakeholders other than shareholders is obvious. Yet stakeholder theory has not guided mainstream marketing practice to any great extent (Polonsky, 1995). To use the theory/practice distinction provided by Argyris and Schon (1978), it is a theory espoused rather more than a theory practiced in action.
Research by Freeman and Reed (1983) traced the origins of the stakeholder concept to the Stanford Research Institute. They suggest a SRI internal document of 1963 is the earliest example of the term’s usage. This document included customers, shareowners, employees, suppliers, lenders and society in its list of stakeholders. The stakeholder concept has attracted considerable interest in the strategic management literature, especially since the publication of an influential text (Freeman, 1984) that contained a deceptively simple but broad definition of stakeholders (p. 46), namely: “. . . all of those groups and individuals that can affect, or are affected by, the accomplishment of organizational purpose”. An important dialogue on stakeholder theory has emerged over the past decade, especially in articles and contributions to the Academy of Management Review, starting with a critique from Donaldson and Preston (1995) that argued that three associated strands of theory might converge within a justifiable stakeholder theory, namely descriptive accuracy, instrumental power and normative validity.
Stakeholder theory is clearly an important issue in strategy (e.g. Carroll, 1989; Donaldson and Preston, 1995; Harrison and St John, 1996; Useem, 1996; Campbell, 1997; Harrison and Freeman, 1999). However, within the strategy field there is not a great deal of agreement on the scope of stakeholder theory (Harrison and Freeman, 1999). In particular, there is still a debate regarding which constituent groups an organisation should consider as stakeholders. For example, Argenti (1997) suggested an infinite number of potential groups while Freeman (1984) has argued that there is excessive breadth in identification of stakeholders.
Recently Polonsky et al. (2003) concluded that there are “no universally accepted definitions of stakeholder theory or even what constitutes a stakeholder” (p. 351). However, they see two rival perspectives: one where stakeholder intent means “improving corporate performance”, and another where it means “maximising social welfare and minimising the level of harm produced within the exchange process” (p. 351). While these aims may never be entirely reconciled in practice (Gioia, 1999), the dominant assumption that the pursuit of “profit” is for the shareholders effectively denies legitimacy to other claims to the meaning of profit as a “shared benefit”, or as a“shared good” (Smithee and Lee, 2004).
Relationship-based approaches to marketing offer a reformist stakeholder agenda with an emphasis on stakeholder collaboration beyond the immediacy of market transactions. According to different authors, this involves creating exchanges of mutually beneficial value (Christopher et al., 2002), interactions within networks of relationships (Gummesson, 1999), or mutual commitment and trust that may or may not be achievable (Morgan and Hunt, 1994). Relating is connecting, and at its simplest level, a relationship is a state of being connected. A critical question arises: “With whom are you connected, and why?”. These questions require judgments about particular relationships – and strategic value choices.
This article explores the development, extension and use of the “six markets” stakeholder model (Christopher et al., 1991) and proposes a framework for analyzing stakeholder relationships and planning stakeholder strategy. The article is structured as follows. First, we review the role of stakeholders in relationship marketing. Second, we discuss the development and refinement of the six markets model, and describe how the model has been...