Exploring the Links between Stakeholder Type, and Strategic Response to Stakeholder and Institutional Demands in the Public Sector Context

Abstract

The management of increased numbers of stakeholder groups with increased and conflicting demands requiresrefined information on who and what really counts to management in terms of these demands from multiplestakeholders. These requirements challenge stakeholder and institutional theory to effectively support thedecision making practice. The purpose of this paper is to examine links between stakeholder theory andinstitutional theory in a way not previously seen in the literature and present new propositions as a potentialextension of these theories. The study makes use of the Mitchell et al. (1997) stakeholder typology model andcombines it with the Oliver (1991) model which offers a typology of strategic responses to institutionalpressures. This is a conceptual paper which employs a literature based analysis and from this generates six newpropositions. These propositions can be tested in future research. The main implication is that the paper has thepotential to assist managers in dealing with multiple stakeholders’ interests. Several insights are provided forfurther research and for improvement in current practice.