Wednesday, 15 June 2011

Project and Programme Management #06: Stakeholders

My last article covered the justification section of the business case: the “why”. This article moves on to look at the “who” and introduces stakeholder management.

What is Stakeholder Management
It is
  • the identification of a project’s key stakeholders,
  • an assessment of their interests and the ways in which these interests affect the project and its viability,
  • the planning of how best to engage with stakeholders,
  • carrying out the engagement.
A stakeholder is any person, group or institution with an interest in the project. A stakeholder may not necessarily be involved/included in the decision making process. Stakeholders should be identified in terms of their roles not individual names.

A stakeholder need not be directly affected by the project, for example one stakeholder could be a member of staff who will be using a new system that the project will implement, but the customers who that member of staff provides a service to could also be stakeholders even though they aren’t direct users of the system.

The first three bullet points above are carried out by a stakeholder analysis exercise.

Stakeholder analysis results should be recorded carefully – the information can be very sensitive (e.g. a stakeholder may not like to be identified as a blocker). The audience for reporting results of stakeholder analysis must be considered very carefully if it is outside of the Project Board.

You should use workshops to carry out the information capture and analyses described below.

Why carry out a stakeholder analysis?

Stakeholder Analysis:
  • Draws out the interests of stakeholders in relation to the project’s objectives – stakeholders who will be directly affected by, or who could directly affect, the project are clearly of greater importance than those who are only indirectly affected;
  • Identifies actual and potential conflicts of interest – a stakeholder who is vital to your project may have many other priorities and you need to know this so that you can plan how to engage with them;
  • Identifies viability other than in pure financial terms (e.g. includes social factors) – for example staff who will be using a new system might be worried about the change;
  • Helps provide an overall picture;
  • Helps identify relationships between different stakeholders – helping to identify possible coalition.
Stakeholder Analysis for minor projects

Stakeholder analysis for minor projects is a scaled down version of the more detailed analysis fopr more complex projects.

The table below is an example of a simple stakeholder analysis (click image for larger version).

Having identified stakeholders and the management strategy for them, you should ensure your project plan includes those management activities.

Having carried out the initial analysis, this should be revisited regularly throughout the project both as a reminder that stakeholder positions can change, so the management strategy may have to alter, and that new stakeholders may be identified as the project progresses.

Stakeholder Analysis for Medium and Major projects

For medium and major projects it is vital to carry out a more detailed stakeholder analysis, not least because the success or failure of the project can depend on ensuring key stakeholders are kept informed and “on side”.

A four-step process is ideal, but at least you should carry out the first two steps below.
  • Identify the stakeholders
  • Create a Stakeholder Map
  • Identify Stakeholder Allegiance
  • Create a Stakeholder Management Strategy

Identify the stakeholders

The first step is similar to the minor projects process: identify who the stakeholders are, listing them out in a table like the one below (click on image for larger version).

Create a Stakeholder Map

Map stakeholders on a Stakeholder Matrix according to the level of impact of the change on them and the importance these stakeholders to the success of the change project. Use the grid below and decide which part of the grid each stakeholder fits into, then follow the relevant management strategy for each one (click on image for larger version).

In this example, the HR Director would go in the top right box, the Operations Managers in middle/bottom box and the Admin workers in the right/bottom box.
Note that stakeholder positions can change, so they should be regularly reviewed, and also that new stakeholders may emerge.

Identify Stakeholder Allegiance

The purpose of this step is to decide the extent to which each stakeholder (or stakeholder group) supports or opposes the project. The table below identifies the possible allegiances (click image for larger version).
In our example, one would hope the HR Director, our project Sponsor, is an Advocate. The Operations Managers could each occupy different positions so manager A might be a Follower and manager B a Blocker. Similarly the Admin staff in different faculties may hold different positions.

Create a Stakeholder Management Strategy

The strategy basically spells out where you want each stakeholder to “go” in terms of the project, and how you will manage them in order to get them there. The table below illustrates this (click for larger version). The faces indicate where the stakeholder sits at present, and the arrows represent what movement you want to try and achieve for each stakeholder.

Stakeholder management is not a one-off process, but should be continual throughout the project, with regular cycling through all the stages to identify new stakeholders and changes in known ones.

1 comment:

  1. To be successful in your career, a positive interaction with people working around is a key. In a similar manner, it is extremely important to identify and manage stakeholders. Stakeholder management is important to the success of every project. Involving and engaging with the right people in a positive manner is highly important for project success.