Stakeholder Engagement Management

Stakeholder management is a renewed area of focus for project managers; yet, many project teams fall short in this critical area. This paper will focus on how to set and manage expectations (SAME) of the stakeholders through a structured step-by-step approach. You will be presented with tools and techniques designed to walk you through the processes of stakeholder identification, stakeholder classification, and stakeholder management strategy development. The output of these processes will lead directly to the development of an effective communication management plan, our plan to keep project stakeholders informed regarding project status, progress, and forecasts.

There are various definitions for a stakeholder:

  • One that has a stake in an enterprise.
  • One who is involved in or affected by a course of action.
  • Someone with an interest in the outcome of a project, either because they have funded it, will use it, or will be affected by it.
  • A group or person who has interests that may be affected by an initiative or have influence over it.

These definitions are drawn from the general business environment and generally refer to what most people agree upon – a stakeholder is an individual or entity that can affect, or is affected by some outcome.

Project Stakeholders

Any individual, group or organization that can affect, be affected by, or perceive itself to be affected by, an initiative (programme, project, activity, risk)[i].

The interesting perspective added here is that if someone or group believes themselves to be a stakeholder, then they are, in fact, a stakeholder! The PMBOK® Guide seems to agree:

Stakeholders are persons or organizations (e.g., customers, sponsors, the performing organization, or the public) who are actively involved in the project or whose interests may be positively or negatively affected by the performance or completion of the project. Stakeholders may also exert influence over the project, its deliverables, and the project team members[ii].

Without a doubt, the most detailed definition belongs to the PMBOK® Guide, but the message is clear—stakeholders hold a lot of influence within a project and managing their expectations is a very important job.[iii]

Project management is about managing stakeholders’ expectations. If they are not happy, you cannot complete your project successfully.

Small projects have fewer stakeholders, so you can manage them easily. However, larger projects are difficult because of the huge number of stakeholders.

With limited resources and a stressful environment, it is difficult to treat every stakeholder equally. Every stakeholder has different requirements and expectations. So, identify and classify your project stakeholders, find these requirements and expectations, so you can manage them.

Classifying stakeholders is an important process. Here you separate stakeholders as per their power, interest, urgency, etc. After classification, you will develop your stakeholder management strategy[iv].

Stakeholder Management Process

Since the view presented here is that stakeholder management is one of the primary keys to project success, how does the project manager go about following a defined process for doing this? Sure, it takes a number of interpersonal skills, such as listening, managing conflict, and negotiation techniques. But there are some defined steps to the stakeholder management process:

  1. Identify stakeholders:The first thing the project team needs to do is to make up a list of project stakeholders. The goal here is to produce a large list that will be prioritized later on in the process. Remember, it is the stakeholder you fail to identify that is often the one who puts a wrench in your plans later! There are a number of techniques that can be used to identify project stakeholders. Here are a several:
  • Brainstorming with the project team, subject-matter experts (SMEs), and key identified stakeholders. Nominal group technique, Crawford slip method, and affinity diagrams may be helpful tools in this regard.
  • Interviews with SMEs and key stakeholders
  • Prior projects lists of stakeholders
  • Contracts with vendors and suppliers
  • Social network analysis—This technique shows all the stakeholders in the project and any social links between the actors; here, we acknowledge any functional and organizational links, but we also focus on the important, and often undocumented, social relationships among the stakeholders. Of particular interest are the centers of a cluster (PM, BA, and Tim in Exhibit 2), and anyone who spans clusters (BA). The diagram also shows relationships that can be leveraged throughout the project that could be beneficial. For example, in the diagram below, you can see that Tim is a very influential end user, because he is at the center of that cluster. Yet, neither the project manager (PM), project management office (PMO), nor the business analyst (BA) have any direct connection to him. Not addressing Tim’s concerns during the project could scuttle the acceptance of any new system that the project team may be creating, so it is important that the project manager and team reach out to Tim and address any of his concerns.
  1. Classify the stakeholders:Not all stakeholders will have equal influence or interest in the project, so it is important to separate the identified stakeholders into groups, so that an approach to set and manage their expectations can be developed. There are a few tools that allow for a quick partitioning of stakeholders into groups:[i]

The PMBOK Guide describes four models to classify stakeholders:

  1. Power/interest grid
  2. Power/influence grid
  3. Influence/impact grid
  4. Salience model

The first three models are similar and use two attributes. The fourth model uses three attributes. The PMBOK Guide did not explain this model and therefore many other PMP exam reference books ignore the concept.

[i] PRINCE2® 2009 Glossary of Terms (Office of Government Commerce, 2009, p.313)

[ii] PMBOK® Guide—Fourth Edition (Project Management Institute, 2008, p. 23)