O R G A N I Z AT I O N A L R E P U TAT I O N A N D

R E P R E S E N TAT I O N
SPRING 2018

N I C O L E M O S I E R , L I Z Z Y S E N OW I T Z , L A U R E N
B A R O N E , TAY L E R S C H A U E R , & A L LY
PETRUZZELLI
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TABLE OF CONTENTS
Introduction……………………………………………………………..……3

Relationships and Politics

in Interorganizational Relationships ……………………………..….…….…4

Evaluating the Reputation of Hobby Lobby…………………….....………….8

Salient Issues and Organizations Involved…………………….…...………..12

Hobby Lobby’s Missions &

Connecting Organizations to Identities…………………….………………14

Dominant Narratives for Hobby Lobby

and Stakeholder Engagement……………………………………………….19

Stakeholder Theory and

Hobby Lobby’s Stakeholder Networks………………………..……………24

Conclusion…………………………………………………………………..29

References…………………………………………………………………..30

Appendix……………………………………………………………………31

Essay 1……..…………………………………………………….31

Essay 2……..…………………………………………………….35

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INTRODUCTION
Organizations represent themselves and must uphold a reputation to stakeholders
inside and outside the organization. Work in the early 1950’s and 1960’s noted that
different stakeholder groups would view organizations differently, that an image, or
reputation, has dimensions, and the image is a result of information stakeholders
receive about an organization (Coombs & Holladay, 2010). Reputation is considered as
the overall evaluation stakeholders construct about how an organization is advocating
and maintaining stakeholder expectations; thus, reputation is socially constructed.
Organizations sometimes face difficulties managing their reputation and representation
to the public eye and their stakeholders because both are subjective.

Reputation can have both a positive and negative impact on an organization. For
example, because reputation is socially constructed, stakeholder evaluations can make
an organization vulnerable if they cannot change people’s thoughts of the
organization. While reputation emphasizes how external constituents view an
organization’s public face, representation refers to the action an organization’s agents
or employees engage in through relationships that are not marketed, publicized, or
promoted. But their representation of an organization through relationships is as
important for communicating strategically as its reputation. It is important for the
overall success of the organization to uphold a positive reputation and representation.

3
RELATIONSHIPS AND POLITICS
IN INTERORGANIZATIONAL
RELATIONSHIPS
Organizational environments are made up of the types of organizations, people, and
political standpoints that represent Hobby Lobby’s organizational environment. The
process of gaining social capital provides organizations with new opportunities, access
to resources, and information through building and strengthening relationships (Taylor
and Doerfel, 2011). Through supporting certain societal issues and viewpoints, specific
relationships may increase or decrease in strength. The relationships and political
direction organizations choose to focus on reflects the company's cultural assumptions,
experience, and goals.

4
RELATIONSHIPS AND POLITICS
IN INTERORGANIZATIONAL
RELATIONSHIPS
Table 1
Type Example Description

Media Washington Post ”Here’s what you need to know about the Hobby Lobby
case”
• Religious beliefs prohibit them from providing health
coverage for contraceptive drugs and devices to end
human life after contraception
NGO Every Home for Hobby Lobby donates to several Christian groups to
Christ “reach everyone’s home on Earth with the Gospel”
Business Mardel Christian Independent retailer founded by Mart Green, son of Hobby
& Education Lobby owner, of Christian materials, office supplies and
educational products.
Donor Donation to CEO of Hobby Lobby, David Green, gave evangelist Scott
Republican bid Dawson’s candidate bid for Republican governor a
towards donation of $100,000
Alabama
governor
Government Supreme Court Religious Freedoms Restoration Act, Affordable Care Act,
Contraceptive Mandate (in favor of Hobby Lobby)
Citizen Local Religious Benefits from Hobby Lobby’s organizational viewpoints
Organizations with reference to discounts, support, etc.
“Hobby Lobby also gives a 10% in store discount to
churches, schools, and national charitable organizations for
purchases made with an organizational check or credit
card.” (Hobby Lobby Donations & Ministry Projects)
Global Issue Religious Burwell v. Hobby Lobby (2014) – allowed closely held for-
Freedoms profit corporations to be exempt from a regulation its
Restoration Act owners religiously object to, if there is a less restrictive
means of further the law’s interest, according to provisions
of Religious Freedom Restoration Act (contraceptive
mandate of Affordable Care Act)
*INGO not included because of Hobby Lobby’s status as a strictly national company to the US* 5
RELATIONSHIPS AND POLITICS
IN INTERORGANIZATIONAL
RELATIONSHIPS
Figure1

Taylor and Doerfel’s map (Figure 1) paired with the stated examples specific to Hobby
Lobby’s relationships and politics in interorganizational relationships exemplify a
number of assumptions and themes emergent within the organization. This network of
organizations drive the success of one another through interrelated objectives while
each experiencing its own individualistic needs, issues, and broader networks. This
specific map explains the interactions of each component as they dynamically influence
the network in its entirety. The intersection of organizations, individuals, and political
decisions based on similar beliefs reflect Hobby Lobby’s religious affinity as it
represents the greater opportunities for organizations involved in achieving goals.
6
RELATIONSHIPS AND POLITICS
IN INTERORGANIZATIONAL
RELATIONSHIPS
The organization creates and strengthens relationships mainly with
individuals/organizations that have similar Christian beliefs. The organizational
environment Hobby Lobby submerges itself into consists of family affiliated companies
and nonprofits supporting their noted Christian mission. These cultural assumptions aid
in selecting these specific organizations to form relationships with, gain social capital
from, and make organizational decisions. Hobby Lobby benefits by staying central to
religious beliefs in understanding that the relationships formed on the basis of similar
existing religious views will remain strong in times of relevant societal issues. Although,
this same Christianity centralized organizational network may lack greater stakeholders
and organizational relationships with companies and individuals of differentiating values
or missions. In other words, Hobby Lobby may miss opportunities to form relationships
with other companies because of their religious common denominator in forming
relationships. These missed opportunities strip the organization of possible resources,
information, and social capital gains.

Hobby Lobby bases its main organizational missions and decisions on the Christian
religion. The network of religious affiliations amplify the organization’s consistency to
similar organizations. The organization's values are clearly stated in the company's
commitments as they state to “honor the Lord in all (we) do by operation the company
in a manner consistent with Biblical principles.” For example, the decision to not
provide contraceptive methods to employees is a reflection of the Christian belief not
to end life after contraception. The organization stood by its religious and political
beliefs as the dispute was fought by the Affordable Care Act and won in Supreme
Court on the basis of the Religious Freedoms Restoration Act. Hobby Lobby’s political
reflection has both a following and rejection from the public.

7
EVALUATING THE
REPUTATION OF HOBBY
LOBBY
Stakeholder interaction with an organization correlates directly to the reputation of
the organization. An organization can be whatever it claims to be, however, it cannot
ignore the perceptions of its stakeholders.Very often, the organization must contend
with opposing public opinion and embark on a strategy to change the minds of its
stakeholders. This is known as an instrumental view of image, a way for management to
manipulate how people view the organization (Coombs & Holladay 2010). The end
result is often a relationship which is ultimately shaped by the needs and desires of the
constituents.

Constituents form their own opinions based on several factors: Reputation emerges
from perception, is socially constructed, and varies in three ways. Perception places the
constituents in a position of power, ultimately allowing constituents to decide
reputation (2010). It is socially constructed through word-of-mouth. The first variation
of reputation is being known. Being known occurs through brand awareness and can be
enhanced through marketing and advertising. The next variation of reputation is being
known for something which is simply having a particular attribute of interest or value,
quality, or an idiosyncrasy. The final variation is general favorability which is an overall
approval of the company, or a positive or negative impression relative to competitors.
Each of the three variations of reputation can be influenced by financial impact, social
impact, and environmental impact.

The specific modes of interaction we analyzed for Hobby Lobby are direct relational
interaction, sender-receiver interactions, media scrutiny of organization, indirect
interaction, and social media interaction. Direct relational interaction is when there is
an opportunity for consumers to have a first-hand experience with the company.
Sender-receiver interaction is from controlled messages from the organization, like
advertising, websites, newsletters, and emails from the organization. Media scrutiny is
when the organizations have no control over the content produced. News and media
outlets use agenda setting effects to influence and shape people's interpretations and
evaluations of the organization (2010). Indirect interaction is second-hand information
that can be passed through word-of-mouth or social media. Social media interaction is
organic and out of the control of the company. Comments on social media posts can
influence other users opinions about the company. 8
EVALUATING THE
REPUTATION OF HOBBY
LOBBY
Evaluating Hobby Lobby Modes of Interaction Stakeholder’s have:

Direct Relational Interaction: Physically going into Hobby Lobby, interacting with
Employees, talking to store representatives.
Sender-Receiver Interaction: Customers can send an email, call, or write to Hobby
Lobby with concerns or for information. Newsroom/Blog on its website has
information and updates about what Hobby Lobby is up to.
Media Scrutiny of Organization: When searching Hobby Lobby on the internet,
articles about the Supreme Court case and other issues pop up.
“Here’s What You Need to Know About The Hobby Lobby Case” -Washington
Post https://www.washingtonpost.com/news/the-fix/wp/2014/03/24/heres-what-
you-need-to-know-about-the-hobby-lobby-case/?utm_term=.8bb26d31fdce
“A Very Bad Ruling on Hobby Lobby” -New Yorker
https://www.newyorker.com/news/amy-davidson/a-very-bad-ruling-on-hobby-
lobby
“How Women Secretly Won the Hobby Lobby Fight” -Time Magazine
http://time.com/4168895/hobby-lobby-women-congress-white-house/
“Why Is Hobby Lobby Buying Biblical Artifacts?” -The Atlantic
https://www.theatlantic.com/magazine/archive/2016/01/can-hobby-lobby-buy-the-
bible/419088/
“Woman Freaks Out Over Hobby Lobby Cotton Display”
https://nypost.com/2017/09/18/woman-freaks-out-over-hobby-lobbys-raw-
cotton-display/
Indirect Interaction: Word-of-Mouth
Social Media Interaction: Facebook, Twitter, Instagram,Youtube

9
EVALUATING THE
REPUTATION OF HOBBY
LOBBY
Table 2: News Media vs. Social Media Portrayal
General Tones Themes Compare/Contrast
Observed/Repeated News Media vs.
General Comments
News Media: Negative. There are not Discrimination, Religion, Compare: News mostly
1. “A Very Bad Ruling many articles that Family portrays Hobby Lobby
on the Hobby highlight the in a negative light, and
Lobby Case” philanthropy of Hobby negative comments also
2. “How Women Lobby or the products appear in social media
Secretly Won the it sells, rather most posts.
Hobby Lobby Fight” articles are about the
3. “Woman Freaks issues Hobby Lobby
Out Over Hobby face.
Lobby Cotton
Display”

Thread/General Positive: - Enjoyment, Passion for Contrast: News articles

Comments: #HobbyLobbyChall- Crafting, Complaints are overwhelmingly
1. #HobbyLobbyChall enge was used by many negative, but there are
enge customers to show more positive than
(https://twitter.com/ their love for shopping negative comments
__janaenae/status/9 at Hobby Lobby. about Hobby Lobby
7578576842470195 -People have many products and customer
3) positive things to say on service on its social
2. Meka Lewis Facebook about its media sites.
YESSS!!! Love your products.
spring
fabrics !!!!” Negative: People post
3. Cotton Post complaints on social
https://www.facebook.c media. This post about
om/photo.php?fbid=102 how the cotton decor
11616952874293&set= display is offensive to
p.10211616952874293& African Americans
type=3&theater because of slavery
happened to get a lot of
attention (115,000
likes)
10
EVALUATING THE
REPUTATION OF HOBBY
LOBBY
Table 2 illustrates the misalignment between press coverage and public commentary
observed. The media portrays Hobby Lobby as a company that discriminates against
women based on religious beliefs and refuses to comply with the Affordable Care Act.
On the other hand, its social media pages reflect mostly positive comments from
customers about its products. There is a perceptual misalignment, “when the
constituents do not realize that the organization is living the desired values” (pg. 173).
Hobby Lobby received negative feedback for not offering its employees emergency
contraception. In fact, the company took the case all the way to the Supreme Court
which ruled in its favor. Hobby Lobby received intense scrutiny from the media for
escalating the case, however, the CEO was resolute that the Supreme Court decision
aligns with the company’s values. Its values include “Honoring the Lord in all that we do
by operating the company in a manner consistent with Biblical principles” (Hobby
Lobby, 2018). Not offering emergency contraceptives to its employees aligns perfectly
with the values of the company.

Hobby Lobby’s Newsroom page on its website contains a tab called “Hobby Lobby
Supreme Court Case”. The article explains the Green family’s position and the facts
and outcome of the case. It does not distort or apologize for the family’s commitment
to its religion or belief in God. The Green family does not view the misalignment as an
obstacle in the pursuit of a profitable business model. The CEO firmly believes that
customers have choices and they can decide to shop at Hobby Lobby or not, but their
choices will not affect the family’s beliefs.

Like most organizations, Hobby Lobby has the most control over direct relational
interaction because it controls the physical set-up of the stores, the product placement,
the check-out experience and the quality of the staff. It cannot control incoming
customer feedback or press coverage. It can only respond to them. While Hobby Lobby
certainly wants to provide a superior purchasing experience for each customer, its
founder and CEO, David Greene, has made it clear that neither he nor his company will
be bullied by media scrutiny of the organization’s beliefs and principles. His mantra is
that customers can vote with their feet. He acknowledges they have other options and
he accepts that some will choose to exercise their options to shop elsewhere and that
is fine with him. 11
SALIENT ISSUES AND
ORGANIZATIONS INVOLVED
Alike many other organizations, Hobby Lobby is faced with a few salient issues that can
disrupt the fluency of their operations. Two major salient issues that are recognizable
are competition/differentiation and their legal issues. While these issues are not
detrimental to the company, it is important to analyze them and understand how it
affects engagement of stakeholders and organizations involved.

The first major issue Hobby Lobby faces is with its competitors. Hobby Lobby operates
in more than 45 states through its 600 stores, but still remain the #3 craft and fabric
retailed store behind Michaels and Jo-Anne stores. Although Hobby Lobby remains in
the top three of arts and crafts stores, they still struggle with differing themselves from
their adversaries Michaels and Jo-Anne stores. Other than Hobby Lobby’s religious
beliefs there is nothing extraordinary that sets apart Hobby Lobby from its
competitors. Most of this issue has to do with customers’ personal preference,
convenience, and perception of the company. Customer reviews relayed that Michaels
store layout is preferred because of the organization and simplicity of shopping at one
of their stores. Owners of Hobby Lobby should keep in mind their stakeholder
preference and feedback to hopefully solve this issue and give them a competitive
advantage.

Another issue that Hobby Lobby face is in regards to their strong religious beliefs. One
of Hobby Lobby’s top priorities as a corporation is to operate in a way that honors the
Lord in all business transactions and activities. Hobby Lobby is very open about their
religious beliefs and standpoints as seen in their mission statement, store hours, and
inventory. While there is no transparency in where the owners stand from a religious
perspective, it has brought up some controversy in the past.

In 2014, Hobby Lobby was brought to court after not providing healthcare for its
female employees for emergency contraceptive measures. This decision to not provide
its employees with contraceptive measure was ultimately made by the owners. They
believed offering such healthcare for women goes against Christian beliefs. The
Christian religion views the usage of contraceptive measures as murder, or a mortal sin,
after conception. Burwell v. Hobby Lobby, is a decision in the US corporate law by the
United States Supreme Court. This court case allows Hobby Lobby to be exempt from
offering their employees contraceptive measures due to their religious beliefs. The
courts exemption was considered controversial because of the political debates
regarding the Affordable Care Act and freedoms in the US.
12
SALIENT ISSUES AND
ORGANIZATIONS INVOLVED
Not only does this court case affect the representation and reputation of Hobby Lobby
as an organization, but it also affects the stakeholders as well. This court case gave
Hobby Lobby a negative reputation to the community at first. Since Hobby Lobby has
strong ties with its stakeholders, they are still able to operate and continue as one of
the top leading arts and craft stores. Partnerships with external constituents helped
maintain the organization's overall reputation and to continue to represent themselves
with high Christian values and beliefs. Organizations like Hobby Lobby benefit from
“engaging in ongoing external partnerships. Through being external available to
previously establish networks, Doerfel et al. (2010) showed that organizations could
rebuild after disaster more quickly when their networks were rich in social capital”
(Doerfel in press Engaging Partnerships).

While the salient issues that Hobby Lobby face are not overly detrimental to the
organization as a whole, it does shed some light on the importance of engaging
networks and stakeholders. In the event that an issue arises, such as a court case,
organizations can use their relationships with its stakeholders to their advantage. With
the support of its stakeholders, Hobby Lobby was able to maintain its image of the
organization to the community. For example, during the Supreme Court case affiliated
companies such as Oral Roberts University highlighted the issue in a positive manner.
Oral Roberts University mentioning Hobby Lobby’s issues to the public in a positive
manner ultimately helped Hobby Lobby’s controversial situation. Having support from
one stakeholder, eases suspicions and doubt any other stakeholders may have during a
time of hardship. This can be explained through the concept that engaged relationship
survives through ongoing interaction in which tie strength could increase. Hobby Lobby
is able to have minor bumps in the road such as competition and their religious beliefs
and still operate efficiently because of the strong ties they have with their stakeholders.
By engaging their partnerships and maintaining stakeholder tie strength, Hobby Lobby’s
salient issues are somewhat permissible.

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HOBBY LOBBY’S MISSIONS &
CONNECTING ORGANIZATIONS
TO IDENTITIES
Mission statements are considered a vision of what an organization wants and strives
to be. Most organizations implement mission statements to stress values, positive
behaviors, and guiding principles of an organization's ideology and beliefs system.
Mission statements are not only what the company desires to be but can also be used
as a communicative tool to express their values to both internal and external
stakeholders. Organizations often explicit their mission throughout company
newsletters, annual reports, advertisements, speeches, etc. Companies use these
different mediums as a communicative tool to express their overall purpose as an
organization.

Mission statements are used as an instrument to help an organization shape their

company culture and identity. It is not enough for an organization to just simply state
their mission statement to internal and external stakeholders. Those who hold
leadership or managerial roles are likely to be one of the company’s most trust
stakeholders and have a great deal of influence on other stakeholders. As a result,
mission statements should be communicated by those with a leadership orientation
and incorporated into their routine work aspects. Leadership roles in organizations
should be held responsible for effectively communicating the organizational values and
beliefs in order to make the company’s vision personally meaningful to others. Hobby
Lobby’s mission statement is a prime example of an organization effectively
communicating their mission statement to both internal and external stakeholders:
· Honoring the Lord in all we do by operating the company in a manner consistent
with Biblical principles
· Offering our customers exceptional selection and value
· Serving our employees and their families by establishing a work environment and
company policies that build character, strengthen individuals, and nurture families
· Providing a return on the family’s investment, sharing the Lord’s blessings with our
employees, and investing in our community.

14
HOBBY LOBBY’S MISSIONS &
CONNECTING ORGANIZATIONS
TO IDENTITIES
Communicating an organization’s mission statement to its internal and external
stakeholders is critical because it is a function of the company’s information
environment, level of work commitment, trust in management, and organizational role
(Gail T. Fairhurst (1997)). Hobby Lobby is a Christian family owned store who value
their religion, family, employees, and customers as seen in their mission statement.
Hobby Lobby’s mission statement is an inside look of the standard they hold
themselves to as an organization. Mission statement implementation and
communication to both internal and external stakeholders can be difficult and face
challenges such as in lacking clarity, relevance, salience, veracity, inspiration, and/or
engagement by management. Mission statements lacking such qualities can generate
certain constraints that will impact both internal and external stakeholders.

Table 3
Internal Stakeholders External Stakeholders
(Employees) (Customers)
Clarity No Yes

Relevance No No

Salience Yes Yes

Veracity No Yes

Inspiration Yes Yes (but it depends)

Engagement by Management Yes Yes

Constraints ßà Impact No No

15
HOBBY LOBBY’S MISSIONS &
CONNECTING ORGANIZATIONS
TO IDENTITIES
Clarity
As shown in Appendix A, Hobby Lobby does an exceptional job communicating to
their external stakeholders (customers) regarding selection and value, but are lacking in
their communication with internal stakeholders (employees). Hobby Lobby’s mission
statement is vague connecting to its internal stakeholders when mentioning how they
serve their employees. Although mission statements should be strategically ambiguous,
Hobby Lobby’s communication efforts to its internal employees is too unclear and can
be misinterpreted.

Relevance
As mentioned earlier Hobby Lobby is owned by a Christian family who explicitly
express their religious beliefs throughout their mission statements and business
activities. The mission statement is particularly specific in “honoring the Lord” which
can impose challenges with relevance. Mission statements should embody what a
company wants to be, but these messages should also be relevant and make sense to
most if not all internal and external stakeholders. The references to the Lord stated in
Hobby Lobby’s mission statement is too exclusive to the Christian religion. To be more
effective in communicating their mission statement, Hobby Lobby should be more
strategically ambiguous when touching upon religious references in their mission
statement.

Salience
While Hobby Lobby’s mission statement lacks evidence of relevance, there values
and beliefs regarding their religion are salient. Hobby Lobby openly and clearly states
that their company operates in a way that ensures they honor the Lord and remain
consistent with Biblical principles.

16
HOBBY LOBBY’S MISSIONS &
CONNECTING ORGANIZATIONS
TO IDENTITIES
Veracity
Similar to the salient component of mission statements, Hobby Lobby has some
qualities of veracity. For example, the company expresses their religious beliefs
throughout their stores by recognizing the importance of the Lord’s Day in the
Christian faith. Every Hobby Lobby store is closed on Sunday which expresses their
values and beliefs to both internal and external stakeholders. Hobby Lobby is accurate
in its messages communicated to its external stakeholders, but lacks accuracy toward
internal stakeholders. As part of their Christian values and beliefs, Hobby Lobby
owners are pro-life and therefore do not provide their employees coverage for
contraceptive methods. As a result, internal stakeholders may not be completely
convinced of messages in the organizations mission statement that state their concern
for employees.

Inspiration
The mission statement has potential to inspire and motivate internal stakeholders
such as employees because it focuses on bettering employees and their families. Hobby
Lobby struggles in its efforts to inspire its external stakeholders. Organizations who
themselves are Christian or are not offended by the explicit references to religion may
be motivated by the messages in Hobby Lobby’s mission statement. The challenge with
external stakeholders when it comes to inspiration depends on their feelings toward
religion and explicitly stating religious beliefs to stakeholders.

Engagement by Management
Hobby Lobby’s upper management is pretty engaged in the messages stated in
their mission statement. The company has family members that work within and around
the organization which engages its internal stakeholders in management. Hobby Lobby
also affiliates itself with organizations that hold similar values to them such as Mardel
Christian & Education and Hemispheres.

17
HOBBY LOBBY’S MISSIONS &
CONNECTING ORGANIZATIONS
TO IDENTITIES
Table 4
The table below shows how often Hobby Lobby’s mission statement is reflected and communicated in
the following situations:

Item “translated” for public organizational Prevalence of item on organization’s website

communication
Not Evident Some Use Pervasively
Used
1. Explains some aspect of mission (to a coworker) ✓

2. Discusses (how your job) helps accomplish the ✓

mission
3. Discusses how this mission is different from past ✓
missions at the company (or competitor’s mission)
4. Discusses (organizational/job) activities using the ✓
same words that are in the mission
5. Explains the advantages of working to achieve ✓
the mission
6. Tries to identify parts of the mission that are not ✓
being accomplished (in your department)
7. Encourages others to try to accomplish the ✓
mission
Citation: Gail T. Fairhurst , Jerry Monroe Jordan & Kurt Neuwirth (1997): Why are we here? Managing the meaning of an
organizational mission statement, Journal of Applied Communication Research, 25:4, 243-263

18
DOMINANT NARRATIVES FOR
HOBBY LOBBY AND
STAKEHOLDER ENGAGEMENT
Hobby Lobby, along with all organizations, have a dominant narrative that helps them
stand out from competitors. Hobby Lobby also engages with their stakeholders that
relate to the organization’s dominant narrative. Figure 2, taken from Strand and
Freeman (2015), shows a map of stakeholders and the organization. A dominant
narrative supports the ideas of the most powerful and influential consumers. It can
also be described as a story or an explanation representing an organization. This is
directly related to reputation and representation of an organization because the
dominant narrative is how an organization is run, a mission statement is built, and the
environment of the workplace. The dominant narrative becomes normalized through
repetition and authority in the organization. In the case of Hobby Lobby, the dominant
narrative is their religion and dedication to enforcing biblical principles.

19
DOMINANT NARRATIVES FOR
HOBBY LOBBY AND
STAKEHOLDER ENGAGEMENT
Figure 2

Figure 2: A map of the stakeholders in an organization from Strand and Freeman (2015). The stakeholders are
dependent on the organization and personal goals are dependent on the company’s existence.

20
DOMINANT NARRATIVES FOR
HOBBY LOBBY AND
STAKEHOLDER ENGAGEMENT
Hobby Lobby has adopted its dominant narrative by following specific “rules” within
the organization. For example, all Hobby Lobby locations are closed on Sunday’s. For
all Catholic religions, Sunday is the Holy day. To preserve the organization's dominant
narrative, the retail stores are all closed. Hobby Lobby is also affiliated with other
Christian companies as well as charities. They donate to multiple different charities, all
Catholic, as well as founded the other affiliated Christian companies. One of the
affiliated companies, Hemispheres, was founded by David and Barbara Green, who are
also the founders of Hobby Lobby. It is a furniture store that follows the same beliefs
and rules as Hobby Lobby. The other affiliated company, Mardel, is another craft store
which was founded by David’s son, Mart Green. This craft store is more geared towards
religious homeschooling but still has the same dominant narrative.

Hobby Lobby continues to enforce this narrative in their mission statement, which
reads:
“We are committed to:
• Honoring the Lord in all we do by operating the company in a manner consistent
with Biblical principles
• Offering our customers exceptional selection and value
• Serving our employees and their families by establishing a work environment and
company policies that build character, strengthen individuals, and nurture families
• Providing a return on the family’s investment, sharing the Lord’s blessings with our
employees, and investing in our community.”

Another way Hobby Lobby perpetuates the narrative of Christianity is by denying

women access to contraception. Although this situation has since been resolved, the
policy was only changed after a lawsuit was filed against the company in 2014.

21
DOMINANT NARRATIVES FOR
HOBBY LOBBY AND
STAKEHOLDER ENGAGEMENT
Because Hobby Lobby has a very specific dominant narrative, the social group
connected to it is not very diverse. The two most dominant social groups are the
Christian community and conservatives (pro-life). These two groups have almost
everything in common with Hobby Lobby. The Christian community follows the same
religion that Hobby Lobby supports. Conservatives, or Pro-Life community, although
religion may not be their main concern, they have the same views on life. This narrative
can affect the industries consumers. For example, people that have Pro-Choice views
may feel that they are not welcome or feel uncomfortable to shop at Hobby Lobby. It
may also be uncomfortable for people with other religious beliefs to shop there or
even work there. Because Hobby Lobby’s beliefs are so strong, it may begin to affect
their stakeholders. Figure 3, taken from Strand and Freeman (2015), shows the
summary of Rhenman’s theory of company goals.

Figure 3

Figure 3: A diagram of Rhenman’s theory of company goals. This shows how the demands and power of stakeholders
can affect the company goals.

22
DOMINANT NARRATIVES FOR
HOBBY LOBBY AND
STAKEHOLDER ENGAGEMENT
Hobby Lobby has built their entire organization based on their Christianity. Because
the dominant narrative of Hobby Lobby is strictly based on religion, it has a large effect
on the types of stakeholders connected to the organization. A stakeholder is “any
group or individual who can affect or is affected by the achievement of the firm’s
objectives” (Strand & Freeman, 2015). Since Christianity is Hobby Lobby’s dominant
narrative, most, if not all of their stakeholders will have the same beliefs. These
stakeholders will also have a lot to gain or lose depending on how the business is run.

23
STAKEHOLDER THEORY AND
HOBBY LOBBY’S
STAKEHOLDER NETWORKS
In order to examine Hobby Lobby’s relationships with its stakeholders, it is important
to analyze its stakeholder network and its engagement with stakeholders. Stakeholders
are groups which affect or are affected by an organization and its activities; thus,
stakeholders and organizations have a mutual interest in each other as each party plays
a role in the other’s life or existence (Strand & Freeman, 2015). Stakeholders play an
especially important role in organizations’ existence as stakeholders’ views and
expectations help shape an organization’s reputation. In order to secure positive
reputations, organizations must maintain active relationships with stakeholders and
keep stakeholders’ interests in mind when making decisions.

In order to satisfy stakeholders’ expectations, organizations must create value for

stakeholders. According to stakeholder theory, stakeholder groups often have interests
and values which intersect with a focal organization (Strand & Freeman, 2015). In order
to create value for stakeholders, Strand and Freeman (2015) suggest that organizations
promote the jointness of both groups’ interests. By doing so, organizations are better
able to meet stakeholders’ and their own expectations and thus ideally create a
positive reputation. Table 5 below provides examples of ways how Hobby Lobby
creates value for its stakeholders based on the intersection of their interests. For
instance, Hobby Lobby has a major interest in Christianity and emphasizes its Christian
beliefs in its business activities and decision-making, like closing on Sundays and
including religious holiday messages in its advertising. Many, if not most, of Hobby
Lobby’s major stakeholders, like Christian customers and the Christian community, also
have an interest in Christianity; these groups feel engaged by Hobby Lobby and thus
support the company with resources such as profits or human capital. By focusing on
this intersection of interests, Hobby Lobby is able to create value for itself and its
stakeholders, thus contributing to a positive reputation among stakeholders.

24
STAKEHOLDER THEORY AND
HOBBY LOBBY’S
STAKEHOLDER NETWORKS
Table 5: Stakeholder Engagement & Value-Creation
Stakeholder Group
Christian community (special
interest group)
Green family (Hobby Lobby
owners)
Hobby Lobby employees (those
who share Hobby Lobby’s
Christian beliefs are privileged)
Dominant narrative about
external relations
Hobby Lobby’s mission
statement explains that the
company is run according to
biblical principles
The Greens’ Christian beliefs are
communicated in the company’s
business activities, donations, and
more
Hobby Lobby’s mission
statement communicates the
company wishes to share the
Lord’s blessings with employees
and nurture their families
Stakeholder engagement
Hobby Lobby is closed on
Sundays to honor God, a
decision which many Christians
support
In holiday messages from the
company, the Greens write that
they are “commissioned by God”
to share their religious beliefs
Hobby Lobby offers many
benefits but does not provide
birth control because of its
religious beliefs

Though engaging stakeholders’ interests can often be beneficial to an organization and

its reputation, a potential threat surfaces when an organization’s and stakeholders’
interests do not overlap. When an organization and its stakeholders find their interests
opposed, whichever entity is less dependent on the other for important resources is
more powerful and can exert influence strategies to get their way; in this manner, a
typology of resource relationships exists between an organization and its stakeholders
(Frooman, 1999).

25
STAKEHOLDER THEORY AND
HOBBY LOBBY’S
STAKEHOLDER NETWORKS
For example, in 2014 after the Supreme Court ruled in favor of Hobby Lobby that
corporations run by religious families cannot be required to pay for contraceptive care
for female employees (Liptak, 2014), many consumers and women’s rights and liberal
activists were upset and called for a consumer boycott of Hobby Lobby. As
stakeholders, these groups were not dependent on Hobby Lobby, nor was Hobby
Lobby dependent on them for resources. According to Frooman’s typology (1999), the
groups had little interdependence. However, because of this interdependence, a
consumer boycott from this group made little impact on Hobby Lobby as this group
did not seriously impact Hobby Lobby before the Supreme Court ruling and Hobby
Lobby never engaged these stakeholders. Had stakeholders like conservative
customers, employees, or suppliers, whom the company does engage with and depends
on for resources, been involved in the boycott, Hobby Lobby would have been more
apt to change its decision.

While examining an organization’s relationships and engagement with individual

stakeholder groups is useful, it is also important to examine an organization’s
relationship with stakeholders from a broader, network perspective as multiple
stakeholders often jointly influence an organization. Rowley (1997) argues that a social
network view is valuable because it is more realistic; organizations do not respond to
only one individual stakeholder at a time, they must formulate their decisions so as to
meet multiple stakeholder demands all at once. From a social network perspective, two
variables, density and centrality, are of particular importance. Density, which measures
the number of ties in a network that connect individuals, influences stakeholders’ ability
to constrain an organization, and centrality, which indicates an organization’s position
within the network in relation to others, impacts the organization’s resistance to
stakeholders’ constraints (Rowley, 1997). Three types of centrality exist: Degree
centrality, which refers to the number of connections an organization has; Closeness
centrality, which refers to an organization’s independent access to other network
members; and betweenness centrality, which refers to an organization’s status as a
gatekeeper within the network (Rowley, 1997).

26
STAKEHOLDER THEORY AND
HOBBY LOBBY’S
STAKEHOLDER NETWORKS
As seen in Figure 4 below, we identified a number of the company’s stakeholders, such
as affiliated companies, ministries, universities, competitors, customers, employees, and
the United States Supreme Court, as well as their relations to one another. By creating
and analyzing this network, we learned that Hobby Lobby’s network is somewhat
dense, with a 25% density ratio. However, Hobby Lobby’s different groups of
stakeholder do not have much communication with other groups; for example, the
Christian charities and affiliated companies like Mardel Christian (owned by son Mart
Green) are heavily connected to one another but they are not at all connected to
other stakeholder groups, like Hobby Lobby’s competitors or the Supreme Court. Also,
many different stakeholder groups have different behaviors and expectations; for
example, Michaels, one of Hobby Lobby’s competitors, has different expectations for
Hobby Lobby than a Christian charity who benefits from Hobby Lobby’s donations. For
these reasons, we have deemed the network’s density to be low. This means that
stakeholders are not likely to act as a coalition exerting unified pressure on Hobby
Lobby (Rowley, 1997).

Also seen in Figure 4, Hobby Lobby has high degree and closeness centralities and
moderate betweenness centrality, meaning that Hobby Lobby is well connected in its
network and can act as a gatekeeper to connect different stakeholders to each other
(Rowley, 1997). With lower density and higher centrality, Hobby Lobby takes on a
commander role within its network. Because Hobby Lobby’s stakeholders are widely
dispersed and thus do not exert unified pressure on Hobby Lobby, Hobby is not overly
constrained by its stakeholders. Furthermore, because of Hobby Lobby’s gatekeeper
status and ability to give out or withold resources and capital, it has power within the
network and can influence stakeholders’ expectations that contribute to Hobby
Lobby’s reputation and representation.

27
STAKEHOLDER THEORY AND
HOBBY LOBBY’S
STAKEHOLDER NETWORKS
Figure 4: Hobby Lobby’s Social Network Map

Fig. 4 Hobby Lobby’s network of affiliated companies, Christian charities, a Christian university, competitors,
customers, employees, the United States Supreme Court, and an Evangelist preacher running for governor if Alabama

28
CONCLUSION
A reputable organization is characterized by information produced, trustworthiness,
accuracy, and degree to which the focal organization’s values resonate with those of
stakeholders (Taylor and Doerfel, 2017). Hobby Lobby continues to engage its
stakeholders by consistently upholding its values and business practices. This results in
Hobby Lobby’s high centrality within its network. Its close ties with affiliated companies
and nonprofit organizations have fostered relationships that affect its representation.

Although some may think it is a pitfall that Hobby Lobby remains true to its religious
beliefs and does not apologize for its stance, it has not hindered the success of the
company. Hobby Lobby is an ideological leader. It is a backbone organization; one that
delivers services and brokers relationships between its affiliated companies, nonprofit
organizations, and other stakeholders. It uses its resources (money, website, social
media, relationships) to market its core values, and distributes those resources to those
who embody the same core values. By engaging community, organizations, social
networks, stakeholders, and maintaining relationships, Hobby Lobby strategically
manages its reputation and representation.

29
REFERENCES
Coombs, W. T. & Holladay, S. J. (2010). The Handbook of Crisis Communication. Hoboken, NJ:
Blackwell Publishing Ltd.

Doerfel, M. L., & Taylor, M. (2017). The Story of Collective Action: The Emergence of
Ideological Leaders, Collective Action Network Leaders, and Cross-Sector
Network Partners in Civil Society. Journal of Communication, 67, 920 - 943.

Doerfel, M. (in press). Engaging Partnerships: A Network-Based Typology of

Interorganizational Relationships and their Communities.

Fairhurst, G. T., Jordan, J. M, & Neuwirth, K. (1997). Why Are We Here? Managing the
Meaning of an Organizational Mission Statement. Journal of Applied
Communication Research, 25(4), 243-263.

Frooman, J. (1999). Stakeholder Influence Strategies. The Academy of Management Review,

24(2), 191-205.

Hobby Lobby. (n.d.). Our Story. Retrieved from https://www.hobbylobby.com/about-us/our-

Story.

Liptak, A. (2014, June 30). Supreme Court Rejects Contraceptives Mandate for Some
Corporations. The New York Times. Retrieved from
https://www.nytimes.com/2014/07/01/us/hobby-lobby-case- supreme-court-
contraception.html

Rowley, T. J. (1997). Moving Beyond Dyadic Ties: A Network Theory of Stakeholder

Influences. The Academy of Management Review, 22(4), p. 887-910.

Strand, R., & Freeman, R. E. (2015). Scandinavian Cooperative Advantage: The Theory and
Practice of Stakeholder Engagement in Scandinavia. Journal of Business Ethics,
127, 65-85.

Taylor, M., & Doerfel, M. L. (2011). Evolving network roles in international aid efforts.
Evidence from Croatia’s post war transition. Voluntas, 22(2), 311–334.

30
APPENDIX
Essay 1
Stakeholders exist in all dynamic relationships. People and organizations always
have needs which are sometimes in sync with one another and sometimes at odds
with one another. A stakeholder has a unique and vested interest in a specific
outcome and often has more or less influence on the outcome than another
stakeholder. The actions of major stakeholders usually have a trickledown effect so
that other stakeholders further down the chain are impacted in some way. The effect
may be negative or positive and may in turn, circle back for a trickle up effect on the
major stakeholder.

In an environment where stakeholders wield a great deal of power, Frooman

highlights the differences between a usage strategy and a withholding strategy. A
usage strategy comes into play when the stakeholder makes certain demands in
order to continue to supply a product or resource. A withholding strategy is used
when the stakeholder withholds a resource in an effort to encourage a specific shift
in behavior (Frooman, 2013). In today’s media centric world, it is relatively easy for a
stakeholder to create a grassroots movement to encourage a withholding strategy
against an organization that is behaving in an objectionable way. In a financially
motivated organization, customers are powerful stakeholders. A consumer boycott
fueled by social media is the modern day equivalent of a letter writing campaign or a
protest march in front of corporate headquarters. One recent example of
withholding strategy is the fan boycott of the National Football League. Fans are
stakeholders in the financial success of the NFL because they attend games and
watch the games on TV. Many fans were angry over the NFL’s refusal to take action
to prohibit players from kneeling during the National Anthem, so they opted out of
attending games and refused to watch the games on TV which resulted in fewer
ticket sales and lower tv ratings. Although the major stakeholder (NFL) did not
formally engage with the fans by addressing the issue publicly or making a formal
declaration of a behavior shift, it must be noted that during the 2018 Super Bowl not
one player kneeled during the National Anthem. The stakeholders (fans) may not
have engaged the NFL in an exchange of dialogue, but the message was received and
the objectionable behavior was absent from the most significant NFL event of the
year.

31
APPENDIX
Organizations which are forward thinking recognize that partnerships with
stakeholders can be mutually beneficial. They can achieve their goals of profitability
while also staying true to their mission of corporate social responsibility. This is
referred to as “cooperative strategic posture” (R. Strand & R.E. Freeman, 2013, p.72).
As noted by Strand and Freeman, many Scandinavian organizations manage to achieve
this balance. This is the posture which is taken by more and more U.S. public
companies in an effort to demonstrate to stakeholders (shareholders, customers,
not-for-profits) their commitment to a particular social cause such as the
environment, anti-smoking, childhood obesity, global warming, etc. A good example of
this posture is CVS partnering with a not-for-profit stakeholder, the American Cancer
Society, by banning the sale of cigarettes in their stores.

Although cooperative strategic partnership is becoming increasingly more

common among public companies, this may not be the case among privately held
companies. The stakeholders in closely held family businesses, such as Hobby Lobby,
are different from those in public companies. A private company is not beholden to
shareholders and has no requirement to report financials to the public. They do not
need to prepare an annual report which details their social engagement or
contributions made to charitable causes. In the case of Hobby Lobby, the firm is
owned by one family whose patriarch, David Green, started it with one store in 1972
and has grown it to 600 stores today with $4 billion in sales. The Green family are
Evangelical Christians and David Green runs the business on two basic Christian
principles: 1.) to be in harmony with God’s laws and 2.) To focus on people more
than money (Ertlet, 2013). The stakeholders in Hobby Lobby are Green’s family,
customers, suppliers, and employees. Hobby Lobby is unique in the competitive
marketplace because it doesn’t sell online, closes on Sundays and closes much earlier
than its competitors so that employees can have family time.

By all measures, it would seem that Hobby Lobby is fully invested in its
stakeholders. According to Green, employees have received pay raises the last four
years and customers are getting the best prices and widest selection available in the
marketplace. However, the stakeholder balance changed in 2012 when Hobby Lobby
refused to comply with the provision in the Affordable Care Act requiring all
businesses with more than 50 employees to cover all methods of contraception,
including emergency contraception in the form of the morning after pill.

32
APPENDIX
Hobby Lobby refused to comply based on Green’s religious belief that life begins at
the moment of conception. What followed was a series of lawsuits which ended with
Hobby Lobby suing the federal government on grounds that a private company’s
religious beliefs should be allowed to dictate coverage of this specific form of
contraception. The case went all the way to the Supreme Court which ruled 5-4 in
Hobby Lobby’s favor (Ertlet, 2013).

The stakeholders most directly impacted by the Supreme Court decision are
female employees. Other forms of contraception are still covered, but they must now
pay out-of-pocket for emergency contraception. A search of the internet did not
uncover any evidence of a massive walk-out by employees or any backlash at all. The
stakeholders who seem most perturbed by Hobby Lobby’s stance are customers, as
evidenced by a Facebook page which got 17,000 hits objecting to the decision
(Facebook). There was also some picketing in front of Hobby Lobby stores as shown
in photos on the Facebook page, and some customers reported the stores were not
nearly as busy as before the decision. Stakeholders were speaking through social
media, but Hobby Lobby was not listening.

According to Green’s guiding Christian principles, listening to the stakeholders

(customers) would force the company to make a choice between its faith and the law
and that is simply not a choice he feels he should have to make (Erlet, 2013). Green’s
principles simply do not mandate that he engage with stakeholders on this issue. In
fact, he said, “Customers can vote with their feet” (Chiaramonte, 2012). Green makes
it very clear that he will not engage with stakeholders on this issue. Unlike a public
company, Green as the major stakeholder, is willing to lose some stakeholders in
order to remain true to his values as expressed through the actions of the company.
Stakeholders hold little to no power over Green and the successful business he has
built.

33
APPENDIX
Essay 1 References

Chiaramonte, P. (2012, September 20). Hobby Shop Chain Faces Backlash For Stance
Against ObamaCare. Retrieved March 08, 2018, from
http://www.foxnews.com/us/2012/09/20/growing-boycott-against-retail-
chain-hobby-lobby-after-lawsuit-against-health.html.

Ertelt,Steven (2013, January 4). Hobby Lobby CEO Pens Tragic Letter about Loss of
Religious Freedom. Retrieved March 08, 2018, from
http://www.lifenews.com/2013/01/04/hobby-lobby-ceo-pens-tragic-letter-
about-loss-of-religious-freedom/.

Frooman, J. (1999). Stakeholder Influence Strategies. The Academy of Management

Review,24(2), 191. doi:10.2307/259074

Hobby Lobby Boycott. (n.d.). Retrieved March 08, 2018, from

https://www.facebook.com/HobbyLobbyBoycott/.

Strand, R., & Freeman, R. E. (2013). Scandinavian Cooperative Advantage: The Theory
and Practice of Stakeholder Engagement in Scandinavia. Journal of
Business Ethics, 127(1), 65-85. doi:10.1007/s10551-013-1792-1.

34
APPENDIX
Essay 2
Organizations naturally desire to act in ways that serve their own interests. For
profit organizations exist to maximize earnings, while not for profits ideally operate
to meet unmet needs of people or the environment. To succeed, both organizations
must interact with end users or customers, but they do not do so in a vacuum. There
is a complex web of stakeholders who play a role in the decisions and outcomes of
all organizations. Rowley’s theory of stakeholder influences “relies on social network
constructs.” (Rowley, 1997, pg. 892) The degree to which the stakeholders in an
organization have relationships among and between themselves is often the critical
element in the level of influence the stakeholders will have. The more closely tied the
stakeholders are to each other, the more they will be able to wield power over an
organization. Often times, there is one stakeholder that is uniquely positioned to
wield the most power and that stakeholder is able to use its ties to other
stakeholders to bring about change. The Starkist Tuna case is a perfect example of a
for profit organization which was forced to make a major change because a
stakeholder had relationships with other stakeholders and was well positioned to use
its power to influence them.

In his analysis of stakeholder influences, Rowley puts forth two dimensions of

measurement. The first is density. According to him, density is commonly observed in
social network analysis to describe the structure of a given network. “It measures the
relative number of ties in the network that link actors together and is calculated as a
ratio of the number of relationships that exist in the network compared with the
total number of possible ties if each network member were tied to every other
member” (pg. 896). The highest possible density is 1 since that indicates that all
network members have direct ties to one another. The level of density is an
important measurement because it can serve as an indicator of the level of
communication between organizations and the probability of shared behavioral
expectations. The higher the level of density, the greater the chances of enhanced
communication and shared behavior expectations. Rowley points out that high
density makes it difficult for an organization to put up resistance to stakeholders’
demands (1997). It follows then that lower density may give the focal organization
more flexibility to engage with individual stakeholders and have greater influence on
the outcome.

35
APPENDIX
The second dimension Rowley defines is centrality within a network. To be a
central stakeholder in a network “implies a position of status” (pg. 898). A
stakeholder that is well known to the public and has access to media outlets will
likely occupy a position of centrality in a network of stakeholders because of its
ability to influence other stakeholders. Brass and Burkhardt explain that “degree”,
“closeness”, and “betweeness” are the three components of centrality which
determine stakeholders ability to influence (Brass and Burkhardt, 1993). Degree
represents the number of ties to others in the organization (Rowley, 1997).
Closeness defines the ability to access independently all members of the network
and betweeness is the degree to which a stakeholder control access of other
stakeholders to other sectors of the network (Freeman, 1979).

The degree of density and centrality result in varying levels of interaction and
varying outcomes. Rowley outlines four possible network configurations vis-a-vis
density and centrality. In a high density/high centrality configuration, both the focal
organization and the stakeholders wield power over each other. The stakeholders
have strong relationships with each other (high density) and can collectively act to
effect change, but the focal organization holds power as well through its ability to
control information, relationship with the government or access to the media (high
centrality). This configuration often ends in negotiations between the focal
organization and the stakeholders to reach a common middle ground. The second
configuration is low density/high centrality. The focal organization in this
configuration holds the prominent position because the stakeholders do not have
relationships with each other which enable them to exert pressure over the focal
organization (low density). Moreover, the focal organization may be in a position to
control the flow of information to the media and stakeholders (high centrality). The
third configuration is high density/low centrality. The stakeholders have relationships
with each other (high density) and the focal organization has limited influence (low
centrality) and often ends up giving in to the demands of the stakeholders. The final
configuration is low density/low centrality in which neither the stakeholders in the
network or the focal organization are in positions to influence each other. The
stakeholders do not have relationships with each other (low density) and the focal
organization wields little power in any arena (low centrality). This configuration
usually results in the focal organization operating independently without being
beholden to the demands of the stakeholders (Rowley, 1997).

36
APPENDIX
The example of Starkist in which the environmental organization EII issued a
decree that it would end Starkist’s practice of canning purse-seined tuna purchased
from the foreign fishing tuna fleet (Frooman, 1999), is an illustration of a high
density/low centrality configuration. Starkist is the focal organization and the
stakeholders are EII, consumers, the foreign tuna fishing industry, other environmental
groups and the media. The first step taken by EII was to produce an 11 minute video
showing the process of purse seining the tuna and the resulting death of 100,000
dolphins. The release of this video to environmental groups and later to the general
media, established a relationship, albeit an adversarial one, between EII and Starkist. It
also established a relationship between EII and consumers, most of whom had
probably never heard of EII. When EII used the media to convince consumers to
boycott Starkist, EII effectively established an adversarial relationship with the foreign
tuna fishing industry, even though it never had direct contact with it. Because sales of
the foreign tuna fishing industry were linked closely to the success of Starkist, it
would ultimately be affected if sales of Starkist fell (Frooman, 1999).

Starkist understood that even as the focal organization in the network, it held
very little power (low centrality) over its stakeholders. It may have had a positive
relationship with the media prior to the video release, but the media quickly aligned
itself with EII and Starkist found itself on the other side of the powerful
media. Likewise, consumers may have devoured Starkist before, but the video soured
the taste of many Starkist consumers. Environmental groups who may not have had
Starkist on their radar, were not coming after it with full force. Starkist had no allies
in this fight. Once the video came out, EII immediately had relationships with
consumers, the media and environmental groups. The high density of the network
relationships gave EII the power to organize a boycott and affect change. In the end,
even though using a different type of netting and agreeing to on-board observers was
going to be expensive, Starkist gave in to the demands of the network of its
stakeholders and changed its practice (Frooman, 1999).

Organizations have a tendency to be self-serving until they are put in a position

which demands that they take action to continue on their path. At that time, their
network of stakeholders will challenge them to change or move in another
direction. The density of the network and their own centrality in it, will determine if
they will accept change, resist it, or reach a compromise position.

37
APPENDIX
Essay 2 References

Brass, D. J., & Burkhardt, M. E. 1993. Potential power and power use: An investigation
of structure and behavior. Academy of Management Journal, 36: 441-470.

Frooman, J. (1999). Stakeholder Influence Strategies.The Academy of Management

Review, 24(2), 191-205. Retrieved from
http://www.jstor.org/stable/259074.

Rowley, T. (1997). Moving beyond Dyadic Ties: A Network Theory of Stakeholder

Influences.The Academy of Management Review,22(4), 887-910.
Retrieved from http://www.jstor.org/stable/259248.

Strand, R., & Freeman, R. E. (2013). Erratum to: Scandinavian Cooperative Advantage:
The Theory and Practice of Stakeholder Engagement in
Scandinavia. Journal of Business Ethics,127(1), 65-85. doi:10.1007/s10551-
013-1953-2.

38