Who is a Stakeholder?
Stakeholders are individuals and organizations that are actively involved in the project, or whose interests may be affected as a result of project execution or project completion. It’s a good idea to practice good stakeholder management and constantly communicate with them in order to collaborate on the project.
Typical stakeholders in a project may include the following:
- Project Sponsor: The financier; A person or group who provides resources and support for the project, program or portfolio for enabling success
- Steering Committee: Advisory group providing guidance on key decisions. Includes the sponsor, executives, and key stakeholders from the organization
- Project Manager: The project’s leader
- Executives: The top management executing the project; those who direct the organization’s strategy
- Customers: Direct users of a product or service, often both internal and external to the company executing the project
- Project Team Members: The group executing the project under the project manager’s leadership
- Resource Managers: Managers who control resources needed for executing the project
- Subcontractors to the project
- Consultants to the project
The stakeholders would vary depending on the nature of the project.
What is Stakeholder Analysis?
Stakeholder Analysis is used to identify all primary and secondary stakeholders who have a vested interest in the issues with which the project is concerned, and then coming up with an appropriate strategy to interact with him.
Stakeholder Analysis will result in:
- Achieving the right level of support from key organizational players.
- Addressing potential conflicts between stakeholders.
- Ensuring alignment among all stakeholders on project goals and objectives.
Stakeholder Analysis for a project involves (but not limited to)
- Identifying all stakeholders
- Documenting stakeholders needs
- Assessing & analyzing stakeholders interest/influence
- Managing stakeholders expectations
- Taking actions
- Reviewing status & repeat
Power Interest Grid
The Power Interest Grid or Power Interest Matrix is a simple tool to assist in the classification of Stakeholders. This in turn helps you focus on the key stakeholders for your project. In effect it helps you prioritize and focus on the key stakeholders. You can then come up with the appropriate communication strategy for each of your stakeholders.
The position you allot for each stakeholder would widely determine how you should plan to connect with the stakeholder:
The position that you allocate to a stakeholder on the grid shows you the actions you need to take with them:
- High Power & High Interest Stakeholders: Fully engage with such stakeholders. Make the greatest effort to keep them happy and satisfied with the direction and progress of your project.
- High Power and Less Interested Stakeholders: Keep these stakeholders satisfied, but not so much that they become bored with your message!
- Low Power, Highly interested Stakeholders: They play a supportive role in your project. Keep them adequately informed, and talk to them to ensure that no major issues arise.
- Low Power, Less Interested Stakeholders: Again, monitor these people, but don’t bore them with excessive communication.
This article might suggest that keeping stakeholders happy is a simple and straightforward process. Keep in mind that this is just a framework. In reality you will always come across challenges dealing with stakeholders. Hearing statements like the following are quite common:
- “You have to do it this way only.”
- “This is not what I wanted”
- When this project fails, do not say I did not warn you”
Ensure you do the right level of Stakeholder Analysis and apply the appropriate strategy based on that. Typically, once the Stakeholder Analysis has been completed, the Stakeholder Register is put together which captures the details of each of the Stakeholders, and the communication strategy to adopt for each of the them.
Summarizing the Article
The following video is a good summary of what we have discussed in the article.
Have you done Stakeholder Analysis in any of your projects? Did you use a different technique? Do share in the comments below.