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Stakeholder Management

Is it really important?By Fay A. Best

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Project Communications Management

Chapter 10: Identifies the knowledge area involved in ensuring timely and appropriate generation, collection, dissemination, storage and ultimate disposition of project information. This includes:

Identifying StakeholdersPlan CommunicationDistribute InformationManages Stakeholder ExpectationsReport on Performance• Source PMBOK Guide Fourth Edition

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Communication Activity

Internal and External

Formal and Informal

Vertical and Horizontal

Official and Unofficial

Written and Oral

Verbal and Non-Verbal

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Communication SkillsListening actively and effectivelyQuestioning and probing ideas and situationsEducating to increase team knowledgeFact-finding to confirm situation or informationSetting or managing expectationsPersuading a person or organization to perform and actionNegotiating a mutually acceptable agreementResolving conflictSummarizing, recapping or identifying next steps

Identifying Stakeholders

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“Effective communications creates a bridge between diverse stakeholders involved in a project , connecting various cultural and organizational backgrounds, different levels of expertise, and various perspectives in the project execution or outcome.”

It’s a process …

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Of identifying the people and organizations that are impacted by the project

Documenting relevant information regarding their interests, involvement and impact that they do or may have on the operation of the project success

Who are stakeholders?Stakeholders are persons or organizations who are actively involved with the projects, operations or activities or whose interests maybe positively or negatively affected by the performance or results;

They may exert influence over the project, its deliverables or team members;They maybe in differing levels within the organization;

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10.1 Identify Stakeholders

Inputs• Project Charter• Procurement Documents• Enterprise Environmental Documents• Organization Process Documents

Tools and techniques• Stakeholder Analysis• Expert Judgment

Outputs• Stakeholder Register• Stakeholder Management Strategy

Who are stakeholders?They have varying levels of responsibility and authority from occasional contribution to financial support.They can have an adverse effect on your ability to implement or effect you activities, responsibilities and projects, which can result in delays and increased expenditure.

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Click to edit Master title style9

InputsProject Charter

Sponsors,CustomerTeam membersPeople or organizations affected by the project

Procurement DocumentsContractors Suppliers

Enterprise Environmental FactorsOrganizational and company structureGovernment and Industry Standards

Organizational Process AssetsStakeholder Register TemplatesLessons Learned from previous ProjectsStakeholder Register

Stakeholder AnalysisA Stakeholder Analysis is required when there is a need to determine:

who or what can affect or can be affected by an the objectives or activities of an organization; andhow Stakeholders can influence or affect the organizations’ activities

Such an assessment is key in any management strategy to ensure that some, if all stakeholder needs can be met while seeking to achieve the project objectives.It also helps to clarify the consequences of envisaged transformations whether as a result of new projects or organizational changes.

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Identifying Stakeholder’s

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The project manager must identify internal and external stakeholders in order to determine:

• the levels of interest• expectations;• importance; and• influence.

This done through brainstorming or interviews and are then prioritized, balanced, reconciled so that these concerns can then be integrated in to plan

Typical StakeholdersBusiness owners and stockholders, investorsBanks and creditorsPartners and suppliersBuyers, customers, prospectsCompetitorsGovernment and regulatory bodiesProfessional associations, industry trade groupsMediaNon-governmental organizationsPublic, social, political, environmental, religious interest groups, communities

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Classification of Stakeholders

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Internal stakeholders e.g. Employees within the organization

External stakeholders e.g. NGOs, professional organizations, Government

Primary stakeholders e.g. Board members, stockholders etc

Secondary stakeholders e.g. Government, interest groups

Key Stakeholders

Stakeholder interest

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Customers are

important when it

relates to product quality

Employees are

important when it

relates to circumsta

nces or safety at

work

Government is

important when it

relates to the

environment and

legislation

The Process ….Identify stakeholdersDetermine interests and understand needsClassify into groups / segmentsDetermine conflicts of interests between stakeholdersPrioritize, balance, reconcile synthesize stakeholdersInterviews with stakeholdersIntegrate stakeholder needs into strategy and actions of the project

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The BenefitsBetter understanding of your Stakeholder’s:

Organizations and Coalitions that they partner withThe power, priorities and risks associated with the stakeholder

Better strategies and decisionsBetter acceptance by stakeholders of strategies and decisionsDevelops cooperation between stakeholders and project team, thereby greater success with your project and its implementation.

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This provides a better understanding of:

Key stakeholdersTheir goals, motivators and interestsLevels of power and influenceThe importance and relativity to the projectThe participative roles of each stakeholder in project activitiesThe financial or emotional interest in operationsTheir key motivatorsWhat they want and expect from the project

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A better understanding of:

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The best way for them to receive information from you;

Their current opinion of the organization behind the project;

Who influences their opinions and are these influencers then key stakeholders;

In the event that the opinion is negative, what would it take for them to change their mind; and

Whose opinion can they influence.

Identifying potential impact or support

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To ensure efficient and appropriate communication an expectations stakeholders are classified:

Power / interest grid based on either their levels authority (power) and concern (interest) or active involvement (influence)

The Objective is determine: What information is needed, how frequently, what format and the best way to provide this information.

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High power, interested people

Should be the people you will have the biggest stake on the organization

High power, less interested people

Should be the people who are have a stake in organization, but do not need to have extensive interaction with it.

Low power, interested people

These are the people who need to be adequately informed but are not of great power. These are the people that will likely be helping you.

Low power, less interested people

Keep these people up to date, but no extensive interaction is needed.

Power/Interest Grid

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Keep Satisfied Manage Closely

Monitor (Minimum effort)

Keep Informed

HIGH

HIGHLOW

POW

ER

INFLUENCE

Power / Interest Grid

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Stakeholder Levels of interest

Level of influence

Level of impact

Level of support

Total

Project Sponsor

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

Technical Expert

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

Customer Services Agents

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

1= None 2= Minimal 3= Average 4 = SignificantAnyone scoring above 10 is a Key Stakeholder

Analyzing Stakeholder Data

Stakeholder Reporting MatrixMaps out how project reports should be delivered to key stakeholders and should cover:Scope of interest: which aspects of the project should each stakeholder receive a report?Frequency: How often should each key stakeholder receive a report? (i.e. monthly, weekly, quarterly)

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Stakeholder Reporting MatrixLevel of detail: How much detail should the report contain?Delivery mechanism: How should the report be delivered ( i.e. face-to-face, email, snail mail, newsletter, hard copy via courier)Format: How should the report be laid out ( i.e. bullet, graphics, narrative)

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PMBOK Guide 5th EditionNo major additionTreats Stakeholder Management as a separate Knowledge areaChapter 13.1 Identifying Stakeholders13.2 Plan Stakeholder Management13.3 Management Stakeholder Engagement13.4 Control Stakeholder Management

The 3Ws

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Work together - collaborate with stakeholders on

deliverables (everyone gets the same info and

encourage engagement)

Watch - Monitor stakeholder behaviour for

possible red flags

Ward off - Implement strategies that will allow

you to be defensive if faced by undesirable action or influences

Conclusion

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In an environment where customer perception is reality, it is crucial to create the correct customer / consumer expectation when communicating the benefits of what you are offering your customer.

Basically, promise what you know you can deliver, but exceed your customers’ expectations.

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