Contents
The importance of stakeholder management in project management. Initially, it may seem that only a few people, such as project owners and the team, are interested in a project’s success. However, in reality, there are many stakeholders, some of whom may not be as supportive. Identifying and managing these stakeholders is crucial for project success. Stakeholder management is an ongoing process that begins even before a project starts, as relationships within an organization already exist. Stakeholders are sources of project requirements, which can include not just product specifications but also project management approaches, policies, and more. Unidentified stakeholders can cause disruptions if they introduce new requirements mid-project. Therefore, it’s essential to involve all relevant stakeholders from the outset and manage them strategically throughout the project. This includes aligning their personal goals with project objectives to ensure their cooperation. Stakeholder management should be consistent and continuous, recognizing that stakeholders’ objectives may evolve over time.
Who is a stakeholder?
A stakeholder in a project is anyone who can influence the project by providing requirements, impede its progress through action or inaction, or be affected by the project’s progress or outcome. Identifying stakeholders is crucial early in the project to ensure their requirements are considered, while irrelevant demands can be excluded with the agreement of project owners or other stakeholders. Stakeholder identification involves a thorough analysis of the project environment and the context in which project owners operate.
Project owners are a key group of stakeholders who have direct control over the project, such as sponsors, clients and managers. They may be from the same or different organizations and it’s essential to collaborate with them closely to meet mandatory requirements and keep them engaged throughout the project. Organizational stakeholders, such as your boss and higher-tier managers, have a vested interest in the project’s stability and the satisfaction of clients. They may impose temporary requirements based on organizational needs, so it’s important to keep them informed about project progress and challenges.
Processes and approvals within an organization require compliance with established policies and sign-offs from stakeholders who may not provide direct benefits to the project. Identifying the right individuals in these processes is essential to avoid delays and ensure smooth project execution. Some projects may require rare and critical expert knowledge, which is usually costly and scarce. Engaging these subject matter experts effectively is crucial, as their input can significantly impact the project.
End users are another important group of stakeholders, especially if the project is developing a product or service for internal use. Gathering feedback from end users early in the process helps ensure that the final product meets their needs and addresses their pain points. Critical project team members with unique expertise or leadership roles should be considered stakeholders, as their contributions are vital to the project’s success. Keeping them motivated and engaged is essential.
Resistance from stakeholders who may be negatively impacted by the project is a reality that must be anticipated and managed. Identifying these individuals early and finding win-win solutions can help reduce resistance. Stakeholders unaware of the project may suddenly emerge with additional requirements or liabilities, creating challenges. Ensuring that all relevant stakeholders are informed from the beginning is crucial to avoid such disruptions.
Supporters, including mentors and experts in other teams, can provide valuable assistance and guidance. Building friendly relationships with these individuals can be beneficial for the project. Third-party dependencies, such as vendors or other projects, must also be considered, as they can impact the project’s success. These stakeholders may be entire organizations or groups of people, and managing their involvement is key. Every stakeholder has requirements, and meeting these is a measure of the project’s success. Requirements can range from functional needs to legal, compliance, and organizational demands, making it important to understand and address them.
How do you identify stakeholders?
Identifying stakeholders is a process that involves strategic communication, including meetings, interviews, brainstorming, and other forms of outreach. The process begins internally and expands to include external stakeholders, with the goal of building a comprehensive stakeholder register that captures all relevant information.
A stakeholder register is a critical document for project managers that consolidates all relevant information about project stakeholders. It is essential for identifying and analyzing stakeholders, prioritizing them, and developing effective engagement plans. Despite its importance, inexperienced project managers often overlook the value of a stakeholder register. However, experienced managers recognize that successful stakeholder engagement requires thorough research, testing assumptions, and systematically refining their approach to each stakeholder. The stakeholder register is a vital tool in organizing and documenting these efforts, and it’s important to keep it confidential due to the sensitive information it contains.
The stakeholder register typically includes several key pieces of information: the full name of each stakeholder, their department, location, role on the project, preferred method of communication, and critical attributes like impact, involvement, power, and expectations. These details help project managers understand each stakeholder’s influence and interest in the project, allowing for more strategic and effective engagement. The process of filling in a stakeholder register involves gathering basic information from easily accessible sources and then conducting more in-depth research and analysis to assess the stakeholder’s power, involvement, and impact on the project.
Filling out the stakeholder register requires a blend of observation, direct communication and insights from others. Project managers must use their best judgment, informed by past experiences and empathy, to accurately assess each stakeholder’s characteristics. It’s essential to communicate with others and seek multiple perspectives to gain a well-rounded understanding of stakeholders’ habits and attitudes. The register should be flexible and adapt as the project progresses, with the focus on the top 10 stakeholders who are most likely to influence the project’s success. Rather than relying too heavily on standard categorization tools like power/impact grids, it’s recommended to adopt a personalized approach, particularly for small and medium projects, to build strong, tailored relationships with key stakeholders.
What’s effective stakeholder management?
Effective stakeholder engagement is essential for successful project management, but it requires prioritization and ongoing assessment. With limited time each day, it’s important to focus on the most critical stakeholders—those who can significantly influence the project positively or negatively. This prioritization aligns with the Pareto principle, where a small percentage of stakeholders will drive the majority of outcomes. Regularly reviewing and updating the stakeholder register is crucial, as stakeholders’ importance and characteristics may shift throughout the project.
Understanding stakeholders’ requirements and expectations is key to managing their engagement. Requirements are the explicit needs they expect the project to fulfill, while expectations are their broader, often unstated desires tied to personal or organizational goals. These expectations can be complex and may not align perfectly with the project’s objectives or constraints. Effective communication is necessary to identify and manage these expectations, particularly for powerful stakeholders who may not openly share their true objectives. Gathering information from indirect sources, while sometimes risky, can help in understanding these deeper motivations.
Stakeholder engagement involves ensuring that stakeholders are actively involved in supporting the project’s goals. This requires crafting a detailed engagement plan for each critical stakeholder, including their expectations, desired engagement level, and specific actions needed to keep them invested in the project. Tracking their responses and engagement over time allows for adjustments to the approach as necessary, making stakeholder management an iterative process. A successful project manager not only addresses stakeholders’ requirements but also works to align their expectations with the project’s goals, ensuring realistic outcomes and fostering meaningful engagement.
Things can go wrong
I recall in a project, , I was tasked with leading the development of a new customer relationship management (CRM) system for a mid-sized company. The project had significant visibility within the organization due to its potential impact on sales and customer service. The project team consisted of ten developers, and we were working closely with the sales and customer service departments, who were our primary stakeholders.
During the design phase, a senior manager from the marketing department, Susan, who had previously shown little interest in the project, suddenly requested a series of modifications to the CRM system to integrate marketing automation features. These requests, while aligned with future company goals, were outside the current project scope and would require significant redesign and resource allocation.
I recognized the potential disruption these changes could cause, particularly given the tight deadlines we were facing. I proposed a separate project to address the marketing department’s needs, which would be initiated after the CRM system was fully deployed. However, Susan was adamant about including the changes immediately, arguing that the CRM would be incomplete without them. She escalated the issue to the Chief Marketing Officer (CMO) and copied the CEO, portraying the current project plan as shortsighted.
Sensing that this was more than just a genuine concern for the project, I conducted a stakeholder analysis and discovered that Susan had recently been passed over for a promotion, and the CMO had criticized her for not driving enough innovation. It became clear that her sudden interest in the CRM project was an attempt to demonstrate her value by forcing the inclusion of these marketing features.
To counter this, I engaged the project sponsor and framed Susan’s demands as potentially derailing the project’s success due to the added complexity and timing issues. Together, we presented a revised project plan to the executive team, which included a clear rationale for keeping the marketing features in a follow-up phase. This approach not only preserved the project’s timeline but also aligned with the company’s strategic goals. Ultimately, the executive team approved our plan, and while Susan managed to secure some minor concessions, the project proceeded as initially planned, allowing us to deliver a successful CRM system on time and within scope.
This means that maintaining a stakeholder register is important as well as conducting stakeholder analysis and being aware of the balance of power within an organization. Several factors can kill stakeholder engagement. First, a lack of interest may arise if stakeholders see no benefit in the project, causing them to disengage. This often stems from initial enthusiasm being eroded by other factors. Second, overwhelm can lead stakeholders to ignore project requests because they are swamped with other tasks. In such cases, project managers must be strategic in scheduling and prioritizing. Third, a temporary lack of knowledge can cause stakeholders to disengage to avoid revealing their incompetence. Project managers should ensure stakeholders are fully informed and comfortable with the project’s context. Lastly, conflicting requests due to poor communication or dual reporting lines can leave stakeholders unsure of priorities, leading to disengagement. Resolving these conflicts through clear communication is crucial to maintaining engagement.
By addressing these root causes, project managers can foster greater stakeholder engagement, ensuring a more successful project outcome. Building stakeholder engagement in a project is a continuous process that requires a deep understanding of the stakeholders and their motivations. It is not merely about asking stakeholders to be interested in the project but involves motivating, influencing, and sometimes manipulating them ethically to align their interests with the project’s goals. To effectively build engagement, one must know the stakeholders well, including their values, personal lives, and what they consider valuable beyond monetary rewards. Understanding these aspects allows for the creation of a tailored engagement plan that resonates with the stakeholders’ priorities.
Final Thoughts
Engagement should not be a reactive measure but an ongoing effort. Building relationships with stakeholders before needing their support is vital to keeping them interested and motivated. Regular communication, seeking their opinions, and involving them in decision-making processes help in maintaining their engagement. However, it’s important to strike a balance by not overwhelming them with too many details, while still keeping the door open for their contributions.
A key aspect of maintaining engagement is recognizing that stakeholders are motivated by more than just their salaries. Factors such as responsibility, challenges, and a better working environment can be more motivating. Therefore, understanding what drives each stakeholder and addressing those needs can make collaboration more appealing.
Assessing how key stakeholders are likely to behave in different scenarios is also important. This involves asking “what if” questions to explore the pros and cons of involving stakeholders in certain activities. Such analysis helps in selecting the best strategy for engagement, often relying on instincts and subjective opinions, as facts may not always be available. Finally, giving stakeholders ownership of their tasks can significantly boost engagement. When stakeholders feel a sense of control and authority over their responsibilities, their motivation to contribute increases. Delegating ownership, rather than just tasks, empowers stakeholders and can lead to higher levels of commitment and engagement. However, this should be done thoughtfully, with support available when needed, to ensure the success of the project.
The concept of trade-offs is crucial in project management, where changes in scope, cost, and time must be balanced. Stakeholders need to understand that every request has consequences, and project managers must communicate these trade-offs effectively. If not managed properly, unchecked changes can lead to stress on the team and increased project risk. It’s essential to provide stakeholders with clear alternatives when change requests arise, positioning them as no-brainer decisions that help manage expectations and maintain project integrity.
To enhance stakeholder engagement, project managers should focus on increasing the perceived value of their suggestions. By aligning the perceived value with actual costs and transparently communicating the time and effort required, project managers can influence stakeholder decisions and make them more predictable. Visualization, minimizing hassle, and ensuring control are key strategies to increase the attractiveness of project suggestions.