A few weeks ago, a coaching client of mine asked me to explain stakeholder management. He wanted me to provide him with a definitive list of his stakeholders for his particular project, and asked: “Who are my stakeholders?” First let’s begin with the essentials, the definition of a stakeholder and stakeholder management.
What is stakeholder management?
The Project Management Institute defines a stakeholder as “those who have a stake or an interest in a project or strategy undertaken by a company or an organization, they will be affected in some way by the project and so have an interest in influencing it.” Stakeholders can be either internal or external to the client’s organization. Internal stakeholders work within the client’s organization, and external stakeholders do not work for the organization, but they still have an interest in the project. Stakeholder management involves the client reconciling “the differing stakeholder requirements and passing on clear direction to the project manager” in order to gain a collective agreement and successfully complete the project (PMI, 2003).
Four stages of Stakeholder Management
There are four basic steps in stakeholder management.
- Identifying the list of stakeholders to be considered and whether their interest is positive or negative (or neutral).
- Clarifying the interest, involvement, and the sphere of influence of each stakeholder/ stakeholder group in the project.
- Agreeing on the process by which stakeholder engagement will take place.
- Managing the ongoing relationship until the project is completed making adjustments as needed.
1. Stakeholder list
First, we want to identify who the stakeholders are. Often, we focus on the people who will benefit from the initiative, supporters of the project. It is important to remember that the broad group “stakeholders” includes anyone who has an interest in the project – positive or negative.
Clearly, in the case of my coaching client, this would include the customers who will change the way they do business, and it will include the sponsor of the project, the team designing, building, and testing of the new software, any department whose workflow will be impacted,
We loosely identified stakeholder groups as people who:
|Use the system today and will use the new system tomorrow||+||–|
|People who support the system today and will continue to support the new system||+|
|People who support the system today who will no longer support||– –|
|People responsible for reaping the expected business benefit||+ +|
|People whose processes will change as a result of the new system||+||–|
|People responsible for communicating the change to the outside world||Neutral||Neutral|
|People responsible for creating and leading training in the new system||+||–|
|The management team (MT) of the organization||+ +||–|
|The customers we already have||+||–|
|Customers we hope to attract in the future||+|
|Anyone receiving data from the new system||+||–|
|Project Team Members||+||–|
TIP: Brainstorm the list with as many people as possible. Using a Responsible Accountable Consulted Informed (RACI), or Responsible Accountable Supportive Consulted Informed (RASCI) matrix can help you focus on what sort of involvement you expect them to have. A RACI or RASCI matrix can be used to identify roles and responsibilities during change management processes. Get all the possible stakeholders on the list that you can. It is easy to remove people. It can be painful to bring someone new up to speed that you missed the first time around.
2. Interest, involvement, and sphere of influence
For each stakeholder group, my client made a further list of the members, and he started to highlight those who might have special requests or special interest in the project beyond that suggested by their organizational role.
|Stakeholder||Probable Positive interest||Possible Negative interest||Next step||SOI|
|User – external customer/account holder||New features and ease of use of the new system||May not like change may be comfortable with the features that exist today||Focus group
Customer service reps as proxy
|Narrow – limited avenues to provide input|
|MT – CEO||Increased market share from improved customer experience||Cost of development||Meet to discuss expectations and communication preferences||Wide|
|MT – Project Sponsor – Head of Customer Experience||Improved customer experience, making clear to the team what the experience should be||Negative feedback from colleagues||Meet to discuss expectations and communication preferences||TBD|
|MT – Portfolio Manager||Satisfying organizational goals, approval from management||Costs, delays to other projects, has another project she feels should be a higher priority||Meet to discuss expectations and communication preferences||TBD|
|Team – Designers||Interested in developing new technology||Competing priorities||Meet as a group and discuss needs||Narrow|
|Team – Programmers/ Testers||Interested in developing new technology||Competing priorities||Meet as a group and discuss needs||Narrow|
|Team – QAs||Interested in developing new technology||Competing priorities||Meet as a group and discuss needs||Narrow|
|Team – BAs||Interested in understanding the requirements of the users and of the organization||Competing priorities, possible disagreements between stakeholder groups as to requirements||Meet as a group and discuss needs||Narrow|
My client continued to fill out his grid, assessing which stakeholders warranted individual attention and which could be gathered together as a group. He then planned a series of meetings and calls to explore expectations, next steps, and the process for building the ongoing relationship. He paid particular attention to the sphere of influence and discovered that several of the individual stakeholders had influence beyond the scope of their official role. This led to him adding two stakeholders who at first did not seem to be impacted by the project:
- Head of tax and compliance – he had expressed concerns to the CEO in the past about the security features of the existing system and wanted to make sure the new system would address those concerns. He had a direct line to the CEO and met regularly with the CEO to review the progress on the project.
- The security guard Mr. Smith, on the front desk – he had developed a friendship with the head of customer experience and was a long-time user of the bank’s services. The Head of customer experience considered Mr. Smith as a good benchmark of success for the new system, so he was invited to see prototypes and answer questions from a user perspective even before user focus groups were implemented.
TIP: Consider the sphere of influence and be ready for surprise stakeholders!
3. Agree on the process by which stakeholder engagement will take place.
This comes down to discussing and agreeing on expectations with each stakeholder or stakeholder group. Explore their ideas on how to be engaged. Come up with four or five key ways to engage and communicate.
My client spoke with his stakeholders and came up with the following menu of options:
- Weekly lunch and learns – agreed on Monthly
- Daily status emails
- Weekly status emails – signup offered so that those that don’t want them don’t have to get them
- Monthly status roundup email
- Weekly status meetings
- Dashboard available in a shared location
- Weekly personal updates – phone or in-person – reserved for project sponsor and senior management team (as a team).
- Vlog- video update combining PM on camera and a PPT of current concerns
- Open question time – an hour a day set aside when anyone can call and speak to the PM. First come first served.
- Attendance at design meetings – as appropriate based on stage and product
- Attendance at prototype review meetings – as appropriate based on stage and product
- Weekly newsletter replaced with monthly status roundup
- Recorded team meetings shared online – no
- News wall – a wall of materials sharing details about the program progress, next key dates, key upcoming deliverables, Q&A wall.
- Wiki page for the project
- FAQ on the project Wiki page
- Transparency of ALL project artifacts.
- Bi-monthly project review and planning meeting for all interested parties
- Include updates from team leads – not all from the PM.
Not all the options highlighted were used all the time. My client created a communication plan that incorporated all these various forms of communication. He also worked out with various team members roles for them in the dissemination of information. For example, one of his colleagues with great handwriting updated the new wall on Mondays, Wednesdays, and Fridays.
TIP: make communications interesting (and reduce PM overwhelm) by changing them at different stages of the project. The News Wall may be more useful during testing during development, the bi-monthly review may work better in the early stages of the project when things are moving more slowly, and more groundwork is underway.
4. Managing the ongoing relationship until the project is complete
PMI shares an interesting statistic that is based on research by Andy Crowe that says that project managers spend more than 90% of their time communicating. My own research has shown that 80% of people related to projects – project managers and non-project managers alike – expect us to provide context and purpose and to make sure everyone knows who is on point (90%). When asked what the best thing about a project manager is, many people say that they provide a single point of contact and that they ensure constant and consistent communication. Our interaction with stakeholders is critical to ensuring that project outcomes are predictable, consistent and result in the benefits expected by the consumer. Benefits realization is what projects are about – even more than the triple constraint, because sponsors may live with cost and time overruns if the bang for the buck is high enough. An on-time, on-budget project that does not deliver the expected Return On Investment (ROI), is a failure.
A relationship is not static and nor is the relationship we have with our stakeholders. The individuals may change, their level of interest in the project may wax and wane. I had a stakeholder who said his only interest was knowing when the project was done. He told me the only communication he wanted was a call to say, “the project has been completed and the product is ready for use.”
A common theme I hear with project managers is that all this communication is very time-consuming. In my experience, the time spent on finding out how individual stakeholders process information is the best investment. Often you can reduce the number of touchpoints if you can make each touchpoint really count.
TIP: Try to consider these five elements as you design your stakeholder management plan and the communication plan to go with it:
- Detail vs. Summary
- Visual vs. Auditory vs. Kinesthetic
- Heart vs. Mind
- Feeling vs. Thinking
- Personal vs. Impersonal
Finally, the check-in. Creating a regular check-in to make sure the communication is working, helps keep the stakeholders engaged and the project on track.