© 2014 Routledge, Inc., Taylor and Francis Group. All rights reserved.© 2014 Routledge, Inc., Taylor and Francis Group. All rights reserved.

PowerPoint Presentation Design by Charlie CookPowerPoint Presentation Design by Charlie Cook

CHAPTER 7

Strategies of Societal and Business Interest Groups

© Routledge

© Routledge

Learning OutcomesLearning Outcomes

After studying this chapter, you should be able to:

1. Describe the objectives and roles of societal activists

2. Compare and contrast societal interest groups’ and business interest groups’ operations and financing

3. Explain the difference between peak and trade groups and their advantages and disadvantages

4. Describe the objectives and roles of business interest groups

5. List and briefly explain seven strategies activists use against business

6. List and briefly explain eight nonmarket strategies business interest groups use against activists

7. Compare and contrast strategies used by activists and businesses against each other

8. Define the key terms in the chapter

Societal Interest Group Activists

• Society Interest groups and the communities affected

by business

• Societal interest group activists Advocates of nonprofit or nongovernmental

organizations (NGOs) that aggressively pursue social issues with business and government to promote their interests

• Activists Societal interest groups, their members,

and anyone interested in their causes

© Routledge

© Routledge

The Objectives and Roles of Activists

Roles of Activists

Provide information about business

activities

Develop nonmarket agenda issues for

business

Set voluntary standards and influence laws and

regulations

Pressure business and government to change activities,

policies, and procedures

© Routledge

Figure 7.1 Societal Interest Groups and Their Functions

Public Citizen a consumer advocate to the government

Consumer Federation of America (CFA)

a consumer advocate, source of information and education, and service activist group

Common Cause a public advocate for the public interest in the political process, holding elected leaders accountable

Center for Public Integrity

a nonadvocacy institute that provides investigative journalism on issues of public concern

Business Interest Groups

• Business interest groups Nonprofit organizations comprised of groups of firms

joined together to advocate their interest on issues.

• Peak associations Represent businesses from several industries on a

broad range of general business interest issues.

• Trade groups Represent businesses on a narrower range of

industry- or business-specific interest issues.

© Routledge

© Routledge

The Objectives and Roles of Business Interest Groups

Roles of Business Interest

Groups

Provide information

Set voluntary standards and influence laws and

regulations

Advocate the business side of the issue

Advocate to society and government and to provide services to their members

Provide member services

© Routledge

Figure 7.2 Peak Business Interest Groups and Their Functions

Better Business Bureau (BBB)

a neutral third-party interest group that helps consumers and businesses maintain an ethical marketplace

U.S. Chamber of Commerce

the largest business advocate to government and society

Business Roundtable an association of chief executive officers of leading U.S. corporations that serves as a business advocate to government

National Federation of Independent Business (NFIB)

a small and independent business advocate to government that serves as a key resource to its members

© Routledge

Figure 7.3 Activist Strategies Against Business

Grassroots Efforts

Demonstrations: Picketing and Rallies

Boycotts

News Media Relations and Advocacy Advertising

Building Coalitions

Appeal to Government

Litigation

© Routledge

Activist Grassroots Efforts

Preprinted letters and postcards

Grass-tops

Internet, e-mails, and cyber activity

Grass Roots Efforts to Mobilize Support

Visits

Calls

Letters

Business Strategies Against Activists

• 5 Is Strategic Analysis

1. Identification of the issue and its life cycle stage

2. Identification of interested strategic stakeholders

3. Incentive of stakeholders determination

4. Information—communication objectives and strategies

5. Interaction (nonmarket) strategy selection

© Routledge

© Routledge

Figure 7.4 Nonmarket Strategies Businesses Use Against Activists

Gaining Community Public Sentiment for Being Socially Responsible

Grand Nonmarket Strategies

Lockouts

Grassroots Efforts

News Media Relations and Advocacy Advertising

Building Coalitions

Appeal to Government

Litigation

© Routledge

Grand Nonmarket Strategies for Dealing with an Activist Issue

Donate to activists

Negotiate with activists

Ignore activists

Types of Nonmarket Strategies

Oppose activists

Work with activists

© Routledge

Business Nonmarket andMarket Strategies and Ethics

• Use facts and figures

• Clearly state assumptions

• Gain public sentiment with a good corporate reputation

• Use outside sources, experts, and stakeholders to support the accuracy and legitimacy of the firm’s side of an issue

Information Strategies

• Be socially responsible

• Voluntarily self-regulate

• Maintain ethical relations with all stakeholders

• Implement the eight nonmarket strategies against activists

• Employ an opposing grand strategy

Societal Strategies

© Routledge

Key TermsKey Terms

activists

Better Business Bureau (BBB)

boycotts

business interest groups

business roundtable

center for public integrity

coalitions

common cause

Consumer Federation of America (CFA)

grand nonmarket strategies

grassroots efforts

lockouts

National Federation of Independent Business (NFIB)

peak interest groups

public citizen

societal interest group activists

trade groups

U.S. Chamber of Commerce