Why Stakeholders Management is key to Project success?
Before we talk about anything else, lets first under who stakeholders are?
A project stakeholder is an individual, organization, or group that-Takes an active part or interest in project activities, has a potential impact on a project, is affected by the project’s outcome, can be real or perceived. Stakeholders are people or groups that have something to gain or lose from the project. Some are supportive and some are opposed to the project. Some have a lot of influence, and some have a little. Some are easy to persuade, and some are not but they all have Stake.
Internal stakeholders - Project Sponsor, Project Investor, Project Manager, Project Team members.
External stakeholders - Vendor, Supplier, Customer, Subcontractors.
Let’s understand Stakeholder Management…
Stakeholder management is the process by which you communicate with and engage your company’s stakeholders, prioritizing them by importance and ensuring that all stakeholders feel valued. Through stakeholder management, you can acquire better business outcomes, while also developing long-lasting relationships.
The first step is identifying the project’s stakeholders. Start listing down anyone and everyone who is affected by the project. It is surprisingly easy to miss out one key stakeholder that ends up having a extremely large ability to disrupt the project when they don’t feel that they are being adequately consulted.
Therefore, identification of all the stakeholders, even the most minor ones, is vital.
Once stakeholders are identified and listed, it is time to maintain Stakeholder register with their names, designation, role, expectations, preferred communication method, Impact, and influence on project and this is updated throughout the project life cycle.
Once they are identified, the stakeholders are analyzed to determine their needs and wants, their roles in the project, and how the project affects them.
I. Power-Interest Matrix
There are two primary variables that define the stakeholder’s relationship with the project: Power and Interest. Power is their ability to change or stop the project, and interest is the size of their overlap with the project’s goals.
low power, low interest - Stakeholders need to be monitored to ensure they do not unduly influence the project.
low power, high interest - Stakeholders need to be kept informed to ensure they do not generate unnecessary influence on other stakeholders.
high power, low interest - Stakeholders must be kept satisfied. These stakeholders must have all their needs met to ensure they do not derail the project over small issues.
high power, high interest - Stakeholders are major stakeholders and must be actively managed to ensure they remain supportive.
II. Stakeholder Engagement Assessment Matrix
This matrix represents where the stakeholder is now vs. where the stakeholder needs to go. The five columns correspond to the five possible current locations of the stakeholder: Unaware, opposed, neutral, supportive, and leading. Each stakeholder is placed in one of the columns in relation to their current (C) status, and their desired (D) status.
This provides the analysis and help to establish a plan for bringing the stakeholder from their current status to the desired status. This plan might involve regular communication, open houses, production of reports and analyses, monitoring, or anything that will win them over and generate their interest and involvement.