Stakeholder Management | By Liz Cassidy | Read time minutes
The precessional effect says the actions you take will affect other people. Common sense says the more people you impact, the more likely your actions will affect people who have some power and influence over your actions. These people could be helpful supporters of your projects - alternatively, they may block your projects.
We call people who are impacted by our projects and business activities stakeholders.
A critical skill in project management is learning to win support from interested parties or stakeholders. Mastering this skill ensures that your projects are more likely to succeed.
Stakeholder Analysis is the methodology we use to identify the key people who have to be on our side and support us to ensure that our project succeeds.
The benefits of using a "stakeholder-based approach" are:
- Stakeholders tend to have opinions that may be sought earlier in the project cycle than later. Their knowledgeable input early in the project life can improve the quality of the project and give them a sense of ownership in ensuring the project happens successfully.
- In gaining support from the more powerful stakeholders, we can access more resources - financial, time-based and people-based.
- When we regularly involve the stakeholders, even if it's simply reporting on progress, we ensure they understand what we are doing and are kept abreast of the project status and benefits. If we need their active support, they are already "on side."
- We can predict what stakeholders' reactions to our project may be and ensure that we are actively marketing the project in a way that will win their support.
Step 1: Identify Stakeholders
The first step is to identify the key stakeholders for a particular project. Brainstorm in a group, if possible, who will be impacted by the project: local government, regulators, unions, employees, customers, special interest groups, neighbouring sites, businesses, tradespeople, contractors, investors, managers, suppliers, financiers, banks, the press, etc. Stakeholders may be either an organisation, a trade union, or an individual - the trade union delegate.
Step 2: Create a Power Interest Grid
The next step is to work out their power and influence over and interest in the project. This activity ensures we know where to focus and prioritise our attention, marketing and communications.
- Create a power interest grid by drawing an X and Y-axis on a page. Label the Y-axis, "Power", and the X-axis "Interest."
- Where the axes meet, mark both "Low" and at the extremity of each axis mark "High."
- From our list of interested parties, we mark each person and organisations' level of power versus interest on the grid.
Those we identify as having high power, and low interest will need nurturing and attention. However, those we identify as high power and high interest will need to be marketed to early and regularly in a way that allows them to continue to see the advantages of the project to them. To do this, we ensure that we develop a good understanding of the most important stakeholders to predict how they may respond. This approach allows us to work out how to win their support.
To get an easy-to-use visual report on stakeholders and their impact on the project, we can colour-code the Power Interest Grid. Potential project blockers or critics can be coded in red; project supporters can be coded green; those perceived as neutral can be coded orange.
When unsure about the consequences, it may be helpful to talk to the stakeholders and ask them! Most people are open with opinions, which is the first step in building a successful relationship with them.
Liz Cassidy, the founder of Third Sigma International, is an author, speaker, trainer, executive and performance coach dedicated to facilitating results in her clients' businesses, professional and personal lives.
Recommended read: What Is Stakeholder Management? by Duncan Haughey.