University of Groningen, Faculty of Economics and Business Master thesis, MSc Business Administration
Change Management
June 24, 2013
B.R.J. Bolmer Willem Drenthlaan 1
9501 JE Stadskanaal tel: +31 6 48457243 email: basbolmer@gmail.com
student number: 2244535
Supervisor/University:
Dr. J.F.J. Vos
Second supervisor/University:
Prof. Dr. A. Boonstra
Acknowledgement:
I would like to thank Prof. Dr. A. Boonstra, Dr. M.C. Achterkamp, and, in special, Dr. J.F.J. Vos for their
support while I was writing my master thesis.
2 ABSTRACT
The implementation of information systems within a healthcare organization can be quite a hardship.
Especially the promoters of such systems need to take into account that the implementation of an IS can involve many stakeholders. It is therefore important that these stakeholders are being managed appropriately, such that legitimate stakeholder claims are well considered. This study validates a model that explains how promoters and stakeholders can have transactional, as well as relational motives to cooperate with each other to solve occurring issues. The validation of this bilateral, double-motive model is done by analysing three different cases involving each a promoter and a stakeholder (-group). The results present some interesting findings on both the promoter’s perspective, as well as the stakeholder’s perspective towards cooperation, and contribute to our understanding of how promoter-stakeholder cooperation can occur.
Keywords: promoters, stakeholders, cooperation, issues, transactional motives, relational motives, health care information systems, IS projects.
INTRODUCTION
Todays’ companies constantly need to cope with the ever-changing environment in which they are competing. To respond to these changes companies invest in information technology to pursue fast and innovative initiatives to stay ahead of competition (Lu and Ramamurthy, 2011). Making sure that a company can obtain the benefits from IT-implementations has, however, been proven quite a challenge. While the results and benefits that can be gained from – successful - IT-projects are sometimes presented with much optimism, the implementation that follows can be quite a hardship (Montealegre & Kell, 2000; Chen, Law & Yang, 2009). Managing projects can be a complex task as it requires many factors that need to be taken into account. One of these factors is dealing with those who have a stake in the project, which will be the focus of this research.
Those who have a stake in an organizational objective are defined as stakeholders. According to
Freeman (1984, p. 46) a stakeholder is “any group or individual who can affect or is affected by the
achievement of the organization’s objectives.” In the context of a project, which can be part of
attaining an organization’s objective, many stakeholders can be identified. For example, when
implementing an information system in a healthcare context, stakeholders can be doctors, nurses,
the IT-department, management, governmental agencies, and patient-representatives. Identifying
these stakeholders is important because it shows who is affected by the project, but also who can
affect the project. Especially this latter characteristic of stakeholders can be crucial to a project’s
success, because it suggests that stakeholders could either actively support the project, or hinder it.
3 Besides the stakeholders, it is also important to look at those who promote the implementation of information systems (IS). Promoters of an IS are mainly project managers, general managers and implementers (Achterkamp, Boonstra & Vos, 2013). Their task is to identify the stakeholders that have an interest in the project, but also to keep relevant stakeholders satisfied. According to Mitchell, Agle and Wood (1997) managers can perceive various stakeholder groups differently and prioritize competing claims from these groups. This prioritization of stakeholders, and managing them accordingly, is becoming more and more important as the complexity of projects rises due to an increase in the number of relevant stakeholders.
While IS implementations can occur throughout all kinds of organizations, this research will specifically focus on the healthcare industry. Especially hospitals, because of their size and critical function within society, need to consider many stakeholders when implementing an IS. Literature also pays special attention to this sector by using the term HIT (Healthcare Information Technology) to identify healthcare leveraged by IT. Over the years much attention has been given to IT in healthcare, and with good reason. Research done by Romanow, Cho and Straub (2012, p. 4) shows that “health IT has been identified as an enabler of improved clinical outcomes, and a potential mechanism for lowering costs.” The authors, however, conclude that the “adoption of these technologies is halting and incomplete.” More research, including that which focusses on stakeholder cooperation within healthcare, can help to clarify why this is happening, and might reveal critical success factors that need to be taken into account to increase the success of health IT implementations.
Because of the complexity of IS projects it is not uncommon for issues to arise. To solve these occurring issues, stakeholders and promoters will need to work together to come up with a solution that is mutually acceptable. According to Vos and Achterkamp (working paper), stakeholder cooperation starts with an issue being under discussion. Roloff (2008, p.246) complements this by stating that “whenever a problem or challenge relates to several stakeholders, it is likely to have a complexity that cannot to be handled by one actor”, and then argues that in such a situation the organization involved “should adapt an issue-focussed stakeholder management approach that aims to solve the problem by communication and collaboration between the stakeholders of the issue.”
Issues can range from small requests involving only a few stakeholders, to a large project that affects several groups of stakeholders.
As some issues can have quite an impact, one might assume that stakeholders will do whatever they can to cooperate with a promoter to make sure that the issue is dealt with appropriately.
However, this is not as straightforward as it might seem. Promoters and stakeholders each have their
4 own perception towards a possible cooperation with each other (Vos & Achterkamp, wp). This means that the promoters will weigh whether they will want to cooperate with a stakeholder, and vice versa. What is remarkable though is that within the field of stakeholder theory there has been given significant attention to the actions a firm can take towards stakeholders, while it remains largely unclear how stakeholders can actively engage management (Laplume, Sonpar & Litz, 2008;
Mattingly, 2007).
To contribute to the existing stakeholder theory regarding stakeholder cooperation, and to provide promoters and stakeholders with more practical insights into how cooperation occurs, this research will examine how both parties cooperate with each other, and how they each can influence the cooperation process. This will also help to reveal more about how stakeholders can engage promoters. The following research question will be used for this research:
“What motivations do a promoter and a stakeholder (-group) have to cooperate with each other during an issue in a healthcare IS implementation, and how do these motivations affect the cooperation process?”
While this research question can serve as a guideline, it is still broad and does not clarify how a concept such as cooperation will be measured. To help make this more explicit, an existing framework will be used to explain how cooperation can occur and what factors could influence it.
Also, the concept of promoter is fairly new and unrecognized. It is therefore appropriate to explain the underlying idea of this concept first, before relating it to the existing literature. While normally a literature review serves as a starting point to explain the different variables, this research will begin by explaining the framework. By doing so, a better understanding of the proposed concepts in the framework will lead to a refined research question and a more pervasive literature review.
THE FRAMEWORK
The objective of this research is to try and reveal how stakeholders and promoters cooperate with each other during the implementation of an IS in a healthcare related context. To do so in an adequate way, the promoter-stakeholder cooperation grid developed by Achterkamp et al. (2013) will be used. The reason for choosing this model (see: Figure 1) is that it has already been developed on the basis of fundamental stakeholder theory (e.g. Freeman, 1984; Mitchell et al., 1997; Graves &
Waddock, 2000), and it is introduced as a model that could help in understanding how promoters
cooperate with stakeholders and vice versa. This research aims to improve the model where possible
and to gain a better understanding of the variables affecting the cooperation between promoters
and stakeholders.
5
Promoter’ssalience (7)
Promoter’s reputation (8) Stakeholder
willingness to cooperate with
promoter (9)
Impact of issue on stakeholder
(6) Stakeholder
salience (3)
Stakeholder reputation (4) Promoter’s
willingness to cooperate with stakeholder (5) Impact of issue
on system (2)
Promoter-Stakeholder cooperation (1)
BILATERAL PERSPECTIVE
DOUBLE-MOTIVE PERSPECTIVE
Promoter’s perspective
Stakeholder perspective
Transactional motives Relational motives
Figure 1: Promoter-stakeholder cooperation grid
Key features of the framework
Before explaining the relationships proposed within the framework, two new concepts will be clarified. First, the use of the term promoter will be explained as an actor with whom stakeholders can cooperate. Secondly, the use of transactional and relational motives as influential factors for cooperation will be explained. Then, these concepts, including the stakeholder, will be brought together in order to explain how cooperation can occur according to the model.
The promoter
The term promoter was first coined by Witte (1973), who argued that to increase the success of innovative changes, specialized persons are needed to facilitate the change process. According to Witte, a promoter is “a person that actively and intensively helps to advance an innovative process.”
(Hüsig & Mann, 2010, p.183). Two types of promoters can be identified, those who have hierarchical
power and those who have know-how and expertise. The former can use his or her power to
overcome “will barriers”, since he or she can use power as a means to punish those who resist the
innovation and protect those who support it. The latter type of promoter can use his or her
knowledge and expertise to overcome “skill barriers” as a means to “assist other employees to
understand new problems and use their expert knowledge as argument against antagonists.” (Rost,
Hölzle & Gemünden, 2007, p.341).
6 Another mention of the term promoter comes from the research by Boonstra, Boddy and Bell (2008). While they do not specifically address Witte’s definition, it does have some strong resemblances. Boonstra et al. use the term to address those that are in favour of a certain inter- organizational system (IOS) and represent their interest through the system they promote. The goal of promoters is to “manage a project in a way that increases their chances of a successful outcome.”
(p.103). To do so, promoters will need to make sure that they manage the different interests of the stakeholders involved. Because, as will be explained later in this paper, stakeholders have their own motivations to become involved in the project and to exert their influence where possible.
The term promoter is also used in research done by Achterkamp et al. (2013). The authors use it as a collective term to signify those that promote a system; promoters can, for example, be project managers, general managers, and implementers. In this sense it is very similar to how Boonstra et al.
(2008) use the term. According to Achterkamp et al. one of the most important challenges a promoter faces is that of managing the relationships with the different system’s stakeholders.
Because of the rising complexity of an IS implementation, promoters face the challenge of determining with which stakeholders they will want (or need) to cooperate. Achterkamp et al. define promoters as “those whose aim and responsibility it is to actively promote the introduction of the system.” (p. 3).
This research will use the term promoter as it is being used by Boonstra et al. (2008) and Achterkamp et al. (2013). This means that the term promoter will describe those that are responsible for the introduction of an IS, and whose main goal it is to manage the different stakeholders that can affect or are affected by the IS. To remain consistent throughout this paper, the term promoter will also be used to reflect synonymous terminology used by other academics. For example, Spence, Jeurissen and Rutherfoord (2000) found that organizations are willing to increase their cooperation efforts with stakeholders when they perceive an issue to be relevant for the business. Relating this to the promoter’s perspective, one could argue that, because promoters represent the interest of the organization, they will also be more willing to cooperate with affected stakeholders.
Transactional and relational motives
The grid displayed in Figure 1 can be seen as a model that provides a bilateral, double motive
perspective on promoter-stakeholder cooperation. The bilateral perspective signifies the importance
of the fact that two parties should be taken into consideration before cooperation can occur. The
double-motive perspective explains that these two parties can have different motives to cooperate
with each other. The choice for having transactional and relational motives stems from the rationale
that the parties on either side “can be (dominantly) motivated by individual issue-based reasons
7 leading to flexible, one-issue interactions, or driven by the desire to establish lasting relationships in which a series of sequential and cooperative exchanges are created.” (Vos & Achterkamp, wp). This means that cooperation can result from short-term motivations, as well as long-term motivations.
The short-term, transactional motives determine the actor’s timeframe: solving the issue in a beneficial and timely manner is an important factor for considering cooperation. As will be explained during the literature review, the transactional motives for both a promoter and a stakeholder are influenced by the level of perceived salience. Thus, put simply, how important is the other party for this one issue? The long-term, relational motives take into account the possible future benefits that can be gained from cooperating. When a party cooperates based on relational motives, it is seen as an investment in a lasting relation (Mattingly, 2004a). This also means that the actor is more
“motivated by the perceived benefits of having a cooperative relation with its counterpart”
(Achterkamp et al., 2013, p. 3), than by the solution of the issue at hand.
The framework’s components
As can be seen in Figure 1, the model shows nine blocks in a 2x2 grid. The first block is positioned in the centre of the grid: the promoter-stakeholder cooperation (1). According to Vos and Achterkamp (wp) “cooperation is a two-way process in which both management, the organizational representative(s), and the stakeholders reach decisions about their mutual engagements.” (see also:
Williams, 2010). It is the cooperation with stakeholders which makes it possible for organizations to strengthen existing sources of value and come up with possible new forms of value creation (Freeman and Philips, 2002). This cooperation is, however, contingent on several different factors.
These factors can be viewed through the two different perspectives, the bilateral and the double- motive perspective. Because of the cooperation that both parties can engage in, it is almost self- evident that a bilateral perspective is of importance when looking at how we can gain more understanding of how cooperation materializes. However though, as Vos and Achterkamp (wp) mention, the “stakeholder literature tends to be biased towards the management perspective […]
whereas the bilateral approach has received only little attention.” This seems to suggest that, up till now, literature has largely excluded the stakeholder perspective.
Moving on to the next block puts us in the promoter’s perspective of the grid and shows the
second block: impact of issue on the system (2). The term issue refers to “the subject under
discussion between an organization and its stakeholder(s).” (Vos & Achterkamp, wp). Issues can have
various forms and are often the result from organizational activities. It is something that requires a
stakeholder and the promoter to cooperate with each other, and for the promoter it is of importance
to assess what the impact of the issue on the system will be. The model proposes that the impact of
8 the issue on the system moderates the relationship between stakeholder salience (3)/stakeholder reputation (4) and the promoter’s willingness to cooperate with the stakeholder (5). Blocks three and four refer to the transactional and relational motives of the promoter. The transactional motives are based on the issue under discussion, and a promoter might ask him- or herself: “how beneficial is cooperating for this one issue?” On the other hand the promoter might have relational motives to cooperate with the stakeholder. These motives are based on a promoter’s expectation that a stakeholder will “contribute a great deal of asset value in solving future issues.” (Vos & Achterkamp, wp). The motives that result from the perceived stakeholder salience (3) and stakeholder reputation (4) can both affect the promoter’s willingness to cooperate with stakeholder (5).
On the other side of the grid is the stakeholder’s perspective. As can be seen, there is quite some resemblance with the promoter’s perspective. There are, however, some essential, underlying principles that result in a different perspective towards cooperation from the stakeholder’s point of view. Just as with the promoter, the model proposes that the issue moderates the motives influencing the stakeholder’s willingness to cooperate (impact of issue on stakeholder (6)). The concerns for stakeholders are, however, not to what extent the issue impacts the system, but rather how much it impacts themselves. As Rowley and Moldoveanu (2003, p. 207) argue: “stakeholders have interests [and] mobilize to protect or enhance those interests.” Regarding an issue, stakeholders can thus ask themselves: “what’s in it for me?” The motives that a stakeholder can have to cooperate with a promoter can also be transactional (promoter’s salience (7)), as well as relational (promoter’s reputation (8)). As was the case for a promoter, a stakeholder will also question the cooperation based on possible short- and long-term results. The differences, though, are the underlying principles of how a stakeholder determines a promoter’s salience and reputation. This will, however, be discussed in more detail in the theoretical section of this paper. What is important to note about the model is that it only shows a one-on-one relationship between a promoter and stakeholder. How stakeholders might influence each other in their motives is not taken into account.
As can be seen from the model, the stakeholder’s willingness to cooperate with the promoter (9)
combined with the promoter’s willingness to cooperate with the stakeholder (5) results in a possible
promoter-stakeholder cooperation (1). Having explained the different blocks and relations in the
model, it is now possible to define a more refined research question, as it became clear how
different perspectives and motivations can influence a possible cooperation between a promoter and
a stakeholder. Whereas the previous research questions was rather abstract, the following question
(including sub-questions) will allow for a better analysis of the proposed relationships within the
model and will help to gain a better understanding of how cooperation can develop:
9
“How do transactional and relational motives influence the cooperation process between a promoter and a stakeholder (-group) during an issue in a healthcare IS implementation?”
Relevant sub-questions that will be answered are:
“From the perspective of a promoter, how does stakeholder salience and stakeholder reputation affect a promoter’s willingness to cooperate with a stakeholder?”, and “From the perspective of a stakeholder, how does promoter’s salience and promoter’s reputation affect a stakeholder’s willingness to cooperate with a promoter?”
In the next section the theoretical review will be discussed, in which the different variables will be explored more thoroughly. By doing so we can gain a better understanding of how promoters and stakeholders can have both transactional and relational motives that affect their willingness to cooperate with each other.
THE THEORY BEHIND STAKEHOLDER COOPERATION
To gain a better understanding of how the theory regarding stakeholder cooperation has progressed, a thorough theoretical review is helpful. Additionally, this section will help to reveal what other academics have written about the proposed concepts of the model.
Stakeholder theory
Freeman (1984) revolutionized the concept of stakeholders when he published his book Strategic
Management: A Stakeholder Approach. The term stakeholder has since become an important aspect
of how organizations do business (Parmar, Freeman, Harrison, Wicks, Purnell & Colle, 2010). Because
of the significant contributions made to stakeholder theory based on Freeman’s ideas, this research
will also take his definition as a point of departure for discussing stakeholder theory. The
fundamental assumption of stakeholder theory is that an organization has to take into account
different groups of stakeholders to which it has a responsibility (Parmar et al., 2010). Crane and
Matten (2010, p.61) state that “the main starting point is the claim that corporations are not simply
managed in the interest of their shareholders alone, but that there is a whole range of groups, or
stakeholders, that have a legitimate interest in the corporation as well.” Thus, the responsibility of a
corporation is not solely making profits for its shareholders; it is also about serving a much broader
interest. Ever since the definition of Freeman, stakeholder theory has been given increased attention
by academics. This is not only because of the apparent responsibility organizations have, but also
because an organization can gain something from having a beneficial relationship with its
stakeholders. For example, Mattingly (2007, p. 20) observed that, in case of stakeholder cooperation
with public interest groups, having a healthy relationship with stakeholders helps to “secure the long-
10 term sustainability of the enterprise.” Complementing this, Verbeke and Tung (2013, p. 529) argue that significant research has shown that “devoting appropriate attention to all legitimate stakeholders is important to achieve superior performance.”
To leverage the benefits that can be gained from stakeholder cooperation, promoters will need to try and manage the stakeholders of their organization, or as Boonstra et al. (2008, p. 101) argue:
“promoters need to understand stakeholder attitudes and develop a strategy for managing them.”
The aim of this is to “change aspects of a system, or of its context, to encourage stakeholders to take a more positive attitude towards [the change].” (p. 108). A first step in managing stakeholders is proposed by Mitchell et al. (1997), who suggest that assessing stakeholders on their level of salience will help to determine to what extent they can affect organizational activities. The level of salience consists out of three attributes a stakeholder can have, namely power, legitimacy and urgency. A promoter perceives these attributes differently per stakeholder, and can therefore prioritize stakeholders accordingly. Because of the possible power stakeholders can have, “those advocating a new [IS] need to ensure that enough influential stakeholders support the project because they believe it will serve their interest.” (Boonsta et al., 2008, p. 108). Thus, promoters will need to make sure that they keep salient stakeholders (high on power, legitimacy, and urgency) satisfied in order to gain their support.
The need for managing stakeholders has emerged as a response to the received criticism on stakeholder theory. According to Laplume et al. (2008, p.1161) the “’can affect’ criterion [of Freeman’s definition] causes the term stakeholder to lose much practical significance.” This is also emphasized by Phillips and Reichart (2000), who argue that the definition of Freeman causes ambiguity in determining which stakeholders need to be considered by the organization. If one would interpret the definition quite literally, should all living entities that can affect the firm then be considered by management? To help promoters, literature has provided several tools that can be used in practice to manage stakeholders (e.g. stakeholder map, commitment charts, and the power- interest grid). However, while this is particularly useful for managers, it remains largely unclear how stakeholders, in their turn, can contribute to building a relationship with an organization (Aaltonen &
Kujala, 2010).
Stakeholders that can affect an organization can either be internal (e.g. sales department, senior
management, or the IT-department) or external (e.g. society, governmental agencies, or
competitors) (Freeman, 1984). So far, research has only given limited attention to the influence that
these stakeholders can exert on organizations. One of the first authors that has addressed this
matter has most likely been Frooman (1999), who came up with a model in which he identified four
11 distinct strategies that stakeholders can use to influence organizations. He argues that the influence of a stakeholder depends on two questions, is the stakeholder dependent on the firm? And, is the firm dependent on the stakeholder? Within his model the strategies in which the firm is dependent on the stakeholder are especially interesting to look at, as they imply that stakeholders can be in a position from which they can exert a considerable amount of influence. For example, by applying the proposed direct/withholding strategy, stakeholders can prevent the organization from gaining access to critical resources that they control (Aaltonen & Kujala, 2010). Consequently, by being able to do this directly, stakeholders can put more pressure on an organization to conform to their demands (e.g. a successful boycott exercised by consumers) (Frooman, 1999). That stakeholders can influence organizations in such a (negative) way is one of the reasons why stakeholder theory has been given so much attention. Organizations will want to keep their stakeholders satisfied, as they might otherwise suffer from the possible consequences.
Ultimately, a healthy cooperation between the organization and its stakeholders, from which both can gain value, is mutually beneficial. Achieving such a cooperation, however, depends upon the issue at hand. As Vos and Achterkamp (wp) argue, an issue is “the driver for cooperation:
cooperation only takes place when an issue is under discussion.” In the next section the impact and occurrences of issues will be discussed.
Issues
Issues are the subjects under discussion between a promoter and a stakeholder and can “result from different organizational activities, occur in different points in time, and can thus have various forms”
(Vos & Achterkamp, wp). Issues can affect stakeholders, which in turn can motivate them to undertake action. For example, Lampe (2001) argues that “ultimately, conflict, or at least the potential for conflict, gives the stakeholder concept meaning and a reason for being” (p. 165). While issues do not necessarily have to result in a conflict, promoters should be aware that the issue can lead to stakeholder concerns that need to be dealt with. From a different perspective, issues can also create a positive collaboration process between a promoter and a stakeholder, as the two work together to resolve the issue at hand. This form of collaboration can lead to increased stakeholder satisfaction and could increase the willingness of both parties to also cooperate during future issues (Graves and Waddock, 2000).
Issues regarding an IS in a healthcare context can have quite an impact. The healthcare sector is
information intensive and still too often issues occur that result in “missing, inaccurate, incomplete,
illegible, and inconsistent medical information” (Lahiri & Seidmann, 2012, p.634). The need for a
good IS within a healthcare organization is important because, unlike other industry sectors,
12 employees need the clinical information of clients before they can perform their tasks. D’Souza and Sequeira (2011) argue that because of the importance of information processing, healthcare organizations need to make sure that they have a well-designed IS. Lapoint and Rivard (2005) looked at the level of resistance stakeholders can experience whenever a new IS is implemented. They found that issues over-time can change the behaviour of stakeholders towards the system. These behavioural changes range from adopting the new system to aggressively resisting it.
The impact of an issue can differ from the perspective of the promoter and the stakeholder and could therefore also influence their willingness to cooperate with each other, as it “influences the motives’ significance in each situation.” (Vos & Achterkamp, wp). Where stakeholders will assess the issue based on how it affects their own interest, promoters will mainly look at how the issue affects the system (assuming that they have no direct self-interest in the issue). For example, Spence et al.
(2000) found that organizations are willing to put in more effort when they perceive the issue to be relevant for the business; this includes an increased cooperation with the affected stakeholders.
The double-motive perspective that this research applies shows how an issue can affect both transactional, as well as relational motives. The former is quite straightforward, as it emphasizes the issue at hand. Thus, what motivations do a promoter and a stakeholder have regarding this one issue. The latter can be more complex, as it takes into account the possibility that a promoter and a stakeholder may have “a history of mutual interaction and/or expect to cooperate in the future.”
(Vos & Achterkamp, wp). The relational motives therefore address a much wider scope by looking at how issues were dealt with in the past, and how cooperation might develop in the future.
Promoters perspective
From a promoters perspective it is important to know which stakeholders should be taken into consideration when an issue occurs. Who can affect, or is affected by the issue at hand? The willingness to cooperate with stakeholders depends on the promoter’s perception of their salience and reputation. As mentioned, these two attributes result in a promoter’s transactional and relational motives.
Transactional motives
The transactional motives concern a promoter’s “perception that the stakeholder characteristics are beneficial for the outcome of the issue at hand and that cooperation is therefore desirable” (Vos &
Achterkamp, wp). Solving the issue in a beneficial and timely manner is the “key driver of considering
cooperation.” Mitchell et al. (1997) proposed that three attributes of stakeholders determine to
what extent promoter’s prioritize competing stakeholder claims, namely: power, legitimacy, and
urgency. These three attributes combined, result in the level of salience perceived by a promoter.
13 Greater salience is assigned to those stakeholders that are perceived to possess greater power, legitimacy and urgency than others.
According to Laplume et al. (2008) the three attributes of Mitchell et al. (1997) have received considerable empirical support. For example, Parent and Deephouse (2007) found that in determining the level of salience, power is most influential, followed by urgency and legitimacy. Their results indicated that power was rarely absent, and they concluded that “power is usually necessary for stakeholders to be identified by managers.” (p. 17). Mattingly (2004b) found that all three attributes contribute towards the salience construct.
According to Mitchell et al. (1997) urgent claims from a salient stakeholder give management the mandate to act and “give priority to that stakeholder’s claim.” Stakeholders that are perceived to express a high level of urgency, because they are concerned with the issue at hand, have the power to influence organizational activities directed at the issue, and have a legitimate claim regarding the issue, should be dealt with accordingly (Vos & Achterkamp, wp). Consequently, this perceived level of a stakeholder’s salience determines the transactional motives for a promoter to cooperate with the stakeholder.
Relational motives
Besides short-term motives, promoters can also have long-term motives that increase their willingness to cooperate with certain stakeholders. These relational motives are based on the reputation of a stakeholder. According to Vos and Achterkamp (wp), literature “offers little on stakeholder characteristics indicating relational assets as observed by the [promoter].” However though, with the prospect of assistance during future issues, benefits could be obtained from having a good relationship with stakeholders. Mattingly (2007) observed that, in case of stakeholder cooperation with public interest groups, having a healthy relationship with stakeholders helps to
“secure the long-term sustainability of the enterprise.” (p. 20).
Stakeholder reputation can be derived from two aspects of the salience model, namely: power and
legitimacy (Vos & Achterkamp, wp; Mattingly, 2007). By establishing a lasting relationship with
powerful and legitimate stakeholders promoters can expect to receive support from them during
possible future issues. Urgency, in this sense, is of lesser importance, since the relational motives
take into account the long-term benefits. This is also argued by Harrison, Bosse, and Phillips (2010,
p.70) who found that the beneficial effects of generalized reciprocity (based on a long-term
relationship) tends to increase over time as compared to the effects of immediate reciprocation
(based on a short-term relationship).
14 While promoters might value the relational assets, power and legitimacy, as useful for future issues, this does not necessarily mean that the particular stakeholder will also provide these assets when required. According to Vos and Achterkamp (wp) “future benefits … are more uncertain than assets associated with a current decision, and a cooperative arrangement between two parties can only be viable if these parties acknowledge their obligations between each other.” Hayibor (2012) argues that the relationship between a promoter and a stakeholder might deteriorate over time, which can result in a lack of willingness on the part of the stakeholder to continue to deal with the promoter.
Because of the uncertainty of whether or not stakeholders will share their relational assets, stakeholder reputation will also contain the likelihood that these assets can be obtained. The indicator of this likelihood is defined as reliability. Reliability has a close connection to urgency because it determines “the chances that the potential contribution to the issue (as indicated by the stakeholder’s power and legitimacy regarding the current issue) are captured.” (Vos & Achterkamp, wp). But since urgency is about the issue at hand, reliability will be used to define the possibility to capture relational assets in the future.
Stakeholder perspective
As was already briefly touched upon, not much is known about the perspective of the stakeholder.
Nevertheless, while literature might be limited, it is known that stakeholders “have their own particular views about organizations, which form the basis for their interaction with these institutions” (Vos & Achterkamp, wp). Promoters will need to take these different perspectives into account in order to effectively manage stakeholders. However, how a promoter assesses and perceives a particular stakeholder might not be reciprocal, as a stakeholder might perceive the promoter completely different.
Transactional motives
The transactional motives of stakeholders translate into how they perceive a promoter’s salience.
Thus, how much power, legitimacy and urgency does the promoter have? One can assume that the
higher the promoters’ salience, the more willing a stakeholder would be to cooperate. The rationale
for this is that if a promoter is salient, the stakeholder might perceive the promoter as having
considerable influence. This can then be beneficial for the stakeholder, because being on good terms
with the promoter, might – indirectly – lead to being able to exert more influence. As Achterkamp et
al. (2013, p. 4) argue, the transactional motives are quite straightforward as these are “reasons to
become involved in the issue in order to attempt to influence the promoter’s actions and outcomes
regarding the specific issue.”
15 While a stakeholder could exert more influence through a salient promoter, this could also have certain drawbacks. Salient promoters can take on quite a dominant position, which might lead to the stakeholder being excluded from cooperation. As Granovetter (1973) exemplifies, if a promoter is a central player in the stakeholder network he or she will be able to exert more control. Through a case analysis, Huse and Eide (1996) also discovered how organizations can diminish the power of stakeholders as they demonstrated how networks of business ties allow for corporations to take on a dominant position and to reduce the power stakeholders have. As the authors metaphorically explain: “when large influential networking corporate locomotives are moving, the road is made while they are moving, and stakeholders have no option but to approve the movement.” (p. 234).
According to Laplume et al. (2008, p. 1166) these kinds of power abuse by organizations highlight the more “the darker side of stakeholder management.”
Nevertheless, while a promoter might enjoy considerable salience, this does not necessarily take away the willingness for a stakeholder to cooperate with him or her. According to Vos and Achterkamp (wp) the issue at hand can play an important role, as “it needs no explanation that stakeholders will be more willing to put efforts in interacting with management if the issue has a major impact on them … impact can be the sole motivation for stakeholders to pursue involvement regardless of the [promoters’] reputation.” Stakeholders have certain interests that they are willing to “protect or enhance” (Rowley & Moldoveanu, 2003, p. 207). When these interests are not met, or issues interfere, stakeholders “may impose sanctions on (i.e., take action against) the [focal organization].” (Hayibor, 2012, p. 221).
Relational motives
Besides transactional motives, stakeholders can also have relational motives that influence their willingness to cooperate. The relational motives are based on how stakeholders perceive a promoter’s reputation. Thus far, literature has focussed mainly on organizational reputation, which seems to imply a stronger emphasis towards how external stakeholders perceive the organization.
Nonetheless, Puncheva (2008, p.272) argues that “corporate reputation is a valuable intangible asset
that needs to be managed as it influences stakeholders’ perceptions and preferences of companies”,
and that it encompasses “all of [the organization’s] stakeholders.” (see also: Fombrun & Van Riel,
1997; Wartick, 1992). Because promoters promote the interest of the organization, the assumption is
made that this will influence the stakeholders willingness to cooperate with the promoter; arguing
that, in line with Puncheva (2008), stakeholders will be more inclined to cooperate with the
promoter if he or she has a higher reputation.
16 A promoter’s reputation consists of three attributes, namely: competence (in arranging, engaging in, and influencing the process of cooperation), responsiveness (to stakeholder ideas and initiatives) and fairness (in the cooperation process). According to Vos and Achterkamp (wp) a stakeholder values a promoter’s reputation by relating these three attributes to the promoter’s past performances. The importance of these past performances is demonstrated by Choi and Shepard (2005), as they have demonstrated that stakeholders are more likely to support organizations that they perceive as older, more cognitively legitimate, well liked, reliable, accountable, and strategically flexible. Organizations will also need to make sure that (past) issues are dealt with adequately and that they do not leave any actions that caused a negative response from stakeholders unresolved.
According to Hayibor (2012, p. 246) “past actions against [a focal organization] may also lead to the development of an infrastructure that is supportive of future actions”. Thus, previous successful actions against an organization create a platform from which stakeholders are confident to act again when necessary.
The three attributes of a promoter’s reputation can be derived from various studies related to stakeholder cooperation. For example, Hosmer and Kiewitz (2005) argue that, in order to gain support from stakeholders, their claims should be dealt with in a fair and just way, resulting in the
“fair distribution of the benefits, the allocation of harms, and recognition of rights.” (p. 85). Cheng and Mattor (2006) complement this by arguing that if a promoter is not acting in a fair and competent way it will hamper the collaboration process. Besides the expected fairness, it is also of importance that a promoter is responsive. Beierle and Konisky (2000) found that in situations where promoters exerted a high level of control, flexibility and responsiveness were important in order to come to a successful collaboration process with stakeholders. Competency is also of importance, as Walls, Rowe and Frewer (2011, p.243) argue that, for promoters to engage stakeholders, the interaction process “should be competently enacted in a manner allowing appropriate interactions and exchanges of knowledge/information.”
The relational motives focus, unlike the transactional motives, on the long term relationship with
the promoter. This means that a stakeholder will look at how it can strengthen the relational assets
he or she has with a promoter. Relational assets, which consist of the attributes competence and
responsiveness (Vos and Achterkamp, wp), can be of importance, as the stakeholder might need to
cooperate with the promoter during future issues. Or, it could even be the case that the stakeholder
might attach more value to the relationship than to the outcome of the issue. The likelihood that the
relational assets will also be achieved during future issues depends on the responsiveness and the
fairness of the promoter.
17 Cooperation between a promoter and a stakeholder (-group)
Having discussed the different motives that could influence the willingness of both parties to cooperate, we will now look at what cooperation actually means and what it is about; if cooperation occurs, what is it that the promoter and stakeholder do? Yukl, Lepsinger and Lucia (1992) found that there are eleven influencing tactics that can be used to pursue someone to cooperate. These tactics include: rational persuasion, inspirational appeal, consultation, collaboration, apprising, personal appeal, coalition tactics, pressure, ingratiation, exchange and legitimating tactics. These tactics can be used in one-on-one interventions (i.e. dyads), which is a similar approach compared to the model used in this study. According to Fable and Yukl (1992) not every tactic is equally effective. In their study they tried to reveal to what extent each tactic results in commitment, compliance, or resistance. The results showed that three tactics - legitimizing, pressure, and coalition tactics – almost never lead to active participation. Inspiring and consultation, on the other hand, are two tactics that seem to result in a much higher level of participation and almost no resistance.
Arnstein (1969) developed a similar approach to achieve different levels of participation, and is
known for developing the ‘participation ladder’. According to Arnstein there are eight levels of
participation, ranging from manipulation (nonparticipation) to citizen control (citizen power). While
the ladder seems to focus on federal programs, this does not take away the underlying rationale that
there can be different levels of participation that could affect how cooperation occurs (e.g. using only
manipulation will not lead to a fruitful cooperative process). Arnstein argues that the lowest levels of
participation are nonparticipation. Nonparticipation includes manipulation and therapy and is not
being used to “enable people to participate in planning or conducting programs,” but instead “enable
powerholders to ‘educate’ or ‘cure’ the participants.” (p. 217). The middle area is labelled as
Tokenism, and includes informing, consultation and placation. Here the stakeholders may “hear and
be heard. But under these conditions they lack the power to insure that their views will be heeded by
the powerful.” The last three levels are categorized under citizen power and are partnership,
delegated power, and citizen control. Here the stakeholders do have a degree of power and can also
use this to participate in the decision-making process. Relating this to the model of this research, we
can assume that the level of cooperation depends on the level of participation given to the
stakeholder. Stakeholders who are only allowed to listen to what a promoter has to say do not have
the same influential power as those who can also voice their concerns. This could indirectly influence
the willingness to cooperate, as those with almost no influential power will most likely be less
inclined to cooperate with the promoter than those who do have that power.
18 METHOD
For this research a case study approach was used to explore and explain the relations between the different variables of the model of Achterkamp et al. (2013) (see: Figure 1). According to Yin (1984), case studies can involve either single or multiple cases, and numerous levels of analysis. This research applied a case study approach by looking at multiple cases within the healthcare sector, and taking into account the promoter’s perspective as well as the stakeholder’s perspective in an issue.
According to Parent and Deephouse (2007, p.4) case studies are very appropriate to answer “how”
and “why” questions. For example “how did this stakeholder affect you?” and “why was that stakeholder so important?”. By having used this approach “deeper insights into stakeholder theory”
were provided. While there is no ideal number of cases one should look at, the aim of this study was to analyse at least three cases, which, according to Eisenhardt (1989), is a minimum.
Organizations
The data gathering took place in May 2013 and concerned two organizations located in the north of the Netherlands (area Groningen/Drenthe). The selection of organizations and issues was based on their relevancy and cross-case diversity. The latter selection criterion was important because polar type cases result in a better understanding and greater explanatory power of the proposed model (Eisenhardt 1989). The former selection criterion helped to ensure that the issue was related to an IS implementation and involved a promoter and at least one stakeholder (-group) (i.e. a dyad). The two organizations that participated in the research each were involved in an IS implementation. The promoter for each case was selected based on his responsibility over the project, and his involvement in the issue. Based on the promoter’s recommendation relevant stakeholders were selected.
The first organization (organization (A)) provides residential care to elderly and handicapped. The organization provides full-time care as well as on-demand care. The latter is designed for clients that can still live independently, but may require assistance when necessary. The organization has about 150 employees and around 200 volunteers. Among the employees are nurses and carers that provide the different care packages (full-time or on-demand). Furthermore, the organization is very depended on its front desk, as it is the central pivot of the organization when it comes to communication. This department forwards all external and internal calls to the right persons.
The second organization (organization (B)) is a supplier of prostheses and orthoses to clients that
suffer from a disability (as a result from a deviation in the neuromuscular and/or skeletal system) or a
missing body part. The organization provides these prostheses and orthoses mainly to their own
clients, but it also has good relationships with hospitals in the area (e.g. a cooperative relationship for
the revalidation of clients). The organization has around 340 employees and has locations all across
19 the Netherlands. The main location houses mostly staff functions such as the IT-department and administrative departments, while the other locations provide care to the organization’s clients. The employees at these locations are highly specialized in their own field of expertise and provide custom-made prostheses and orthoses specially designed for their clients’ needs.
Cases
The first issue (case 1) was related to the selection of a new telecommunication system at organization (A). Because of the expansion in a new area, management had decided that it wanted a new telecommunication system that linked the new location with the main location. By centralising the system at the main location, costs would be reduced by saving money that would otherwise be spend on a separate system at the new location. Because the front desk provided the bridge between external to internal calls as well as internal to internal calls, it was important that they were provided with a system that met their needs. To facilitate this, the promoter had to cooperate with the stakeholders of the front desk to select a new system. For this issue, the project leader (head of the technical department) who was responsible for implementing the new system (promoter (A)) and two key-users that had to work with the new system (stakeholder group (A)) were interviewed.
The second issue (case 2) occurred at organization (B). Here the issue concerned the reimplementation of an enterprise resource planning (ERP) system that was used throughout the organization. The existing ERP-system was not being supported anymore and had a lot of custom- made functionalities. It was difficult to maintain all these functionalities and the system’s maintenance costs were becoming a problem. Management decided to update the existing version of the ERP-system and to remove most of the custom-made functionalities. The new version had to become the standard – baseline - version for the whole organization. By removing the custom-made functionalities and standardizing the application, a lot of specialists now have to work with a system that is not specifically designed for them, but instead also serves the rest of the organization. The promoter had to cooperate with the representatives of the different business units to make sure that the standardization did not result in a misfit between the different business processes and the ERP- system. For this issue, the project leader (IT-manager) who was responsible for the re- implementation of the ERP-system (promoter (B)) and a project group member representing the operations department (Stakeholder (B)) were interviewed.
The third issue (case 3) was also at organization (B). This issue involved the actual adoption of the
ERP-system. Because of the standardization of the system (case 2), it was important that all the
employees of the organization knew how the changes would impact their daily work. Not only did
the users have to adopt the new system, they also needed retraining to work with new
20 functionalities. It was the job of the key-users to make sure that all users were up-to-date about the progress of the project, and to help them if there were any problems. However, the key-users also had certain wishes that they wanted to see incorporated in the new system. To facilitate this, the promoter cooperated with the key-users to smoothen the adoption of the system and to take into account their concerns about the system. For this issue promoter (B) was interviewed together with two key-users (stakeholder group (C)).
Table 1 shows the three issues that were researched. For each issue the corresponding organization is given, together with the participants involved and their roles. As can be seen from the table, two participants were grouped as a stakeholder group rather than just a single stakeholder.
The choice for combining these stakeholders into groups was because their responses were either nearly identical (as was the case for Issue #1), or the promoter did not make a clear distinction between the stakeholders (as was also the case for Issue #1, as well as Issue #3).
Organization Case / Issue Participants Role Organization A –
Residential care
Case #1 – The issue of selecting a new
telecommunication system
Promoter (A) Project leader (head of Technical department) Stakeholder
group (A)
Key-user Key-user Organization B -
Supplier of prostheses and orthoses
Case #2 – The issue of standardizing the ERP- system
Promoter (B) Project leader (head of IT- department)
Stakeholder (B)
Project group member
Case #3 – The issue of adopting the ERP-system
Promoter (B) Project leader (head of IT- department)
Stakeholder group (C)
Key-user Key-user
Table 1: The cases