Reference no: EM133863949

Question

Employees are one of the closest stakeholders to the firm, and their relationship can impact many aspects of the business. Employees are intrinsically tied to the firm in a way that not many of the other types of stakeholders are. They rely on the firm for their income and their Well-being. Additionally, employees rely on the corporations that they work for to provide pay and other benefits such as health insurance, retirement accounts, or company cars. The relationship between employer and employee then could be simplified into an exchange of the labor and time of an employee, for pay and benefits from the employer. However, there is more involved in that relationship that keeps them running smoothly, and thus, keeps the business running because in the end, a firm needs employees to operate. This presents managers with a problem though; how do they manage a group so closely tied to the existence of the firm, while keeping both sides of the relationship happy. Both sides must work on it, and both sides must be willing to give something in exchange for something else.