Mendelow’s matrix (stakeholder mapping)

Stakeholder mapping, also known as Mendelow’s power-interest matrix, is a tool used to identify and analyze the stakeholders in a business or organization. Stakeholders are individuals or groups who have an interest or stake in the actions and outcomes of the organization.

The power-interest matrix is a visual representation of the stakeholders based on their level of power and interest in the organization. Power refers to the ability of a stakeholder to influence the decisions and actions of the organization, while interest refers to the stakeholder’s level of involvement or concern in the organization.

The matrix is typically divided into four quadrants:

1. High power, high interest: These stakeholders have a high level of power and a high level of interest in the organization. They are usually the key decision-makers and have the most influence on the organization’s actions. Examples include top executives. This category is known as “key players”.
2. High power, low interest: These stakeholders have a high level of power but a low level of interest in the organization. They may not be closely involved in the day-to-day operations of the organization, but they still have the ability to influence its decisions. Examples include regulators and government agencies. These stakeholders should be “kept satisfied”.
3. Low power, high interest: These stakeholders have a low level of power but a high level of interest in the organization. They may be closely involved in the organization, but they do not have much influence on its decisions. Examples include employees and local community members. These stakeholders should be “kept informed”.
4. Low power, low interest: These stakeholders have a low level of power and a low level of interest in the organization. They may not be closely involved in the organization and do not have much influence on its decisions. Examples could include members of the public who are not particularly interested in the organization. “Minimal effort” would be applied to these stakeholders.

Note that shareholders could be in various quadrants of the matrix. For example, an individual shareholder with a high percentage shareholding and whose shareholding represents his or her complete savings would have a high power / high interest profile. A shareholder who only has a small shareholding and the amount is immaterial to him or her would be in the low power / low interest category.

Stakeholder mapping is used to identify and prioritize the stakeholders based on their level of power and interest. This can help an organization to better understand the needs and concerns of its stakeholders and to develop strategies for effectively managing relationships with them. For example, an organization may choose to focus more on engaging with high power, high interest stakeholders and less on low power, low interest stakeholders.

Stakeholder mapping is a useful tool for organizations to navigate the complex web of individuals and groups that have a vested interest in their actions and outcomes. Real-life examples of stakeholders in various quadrants of the matrix can shed light on the significance of this approach in managing relationships and making informed decisions.

1. High Power, High Interest (Key Players):
   • Top Executives: Within a corporation, top executives, including the CEO and board of directors, wield considerable power and have a deep interest in the organization’s success. They make critical decisions and set the strategic direction. Their actions impact the entire organization and its stakeholders. For instance, Steve Jobs, the co-founder and former CEO of Apple Inc., exemplified this quadrant. His vision and leadership had a profound influence on the company’s success.
2. High Power, Low Interest (Keep Satisfied):
   • Financial Conduct Authority (FCA): The FCA is a regulatory authority in the UK with extensive powers over financial institutions and markets. While its primary focus is on ensuring the stability and integrity of the financial sector, its actions can have far-reaching effects on the banking and investment industries, even if they may not always capture the public’s interest directly.
3. Low Power, High Interest (Keep Informed):
   • Local Residents’ Associations: Local residents’ associations often represent communities’ interests in neighbourhood development and planning issues. They may not have the same level of power as government bodies, but their involvement and concerns about issues like housing developments or green spaces can significantly influence local decisions.
   • Trade Unions: Trade unions in the UK, such as UNISON or the National Union of Teachers (NUT), represent workers’ interests in negotiations with employers and the government. While they may not hold ultimate decision-making power in industries, their influence can shape labor practices and policies.
4. Low Power, Low Interest (Minimal Effort):
   • General Public: While the general public may interact with an organization as customers or users, their individual impact on corporate decisions is typically minimal. For instance, a person who occasionally buys a product from a multinational corporation may have little interest in the company’s internal affairs. The company may address public concerns through customer service but may not prioritize individual opinions in its strategic decisions.

It’s important to note that shareholders, a vital stakeholder group, can occupy various quadrants of the matrix. An individual shareholder with a significant ownership stake and a strong attachment to the company’s performance would fall into the high power, high interest category. In contrast, a shareholder with a negligible stake and little emotional investment would belong to the low power, low interest category.

By employing stakeholder mapping, organizations can gain a clearer understanding of these dynamics and tailor their engagement strategies accordingly. For example, a company facing a major environmental controversy might prioritize engagement with both high power, high interest stakeholders (such as environmental advocacy groups) and low power, high interest stakeholders (like concerned local residents) to address their concerns and mitigate reputational damage. Conversely, minimal effort might be expended on low power, low interest stakeholders, allowing the organization to allocate resources more effectively and build constructive relationships where it matters most.