Stakeholder Analysis is the first step in the Stakeholder Management process. In this article, we’ll define what a stakeholder is, how to identify your stakeholders, and the process you can use to map and analyze the stakeholders in your project.
What is a Project Stakeholder?
Let’s begin by defining what a stake holder is. The PMI defines stakeholders as individuals and organizations who are involved in the project, and whose interests may be positively or negatively affected because of the project successful execution.
You may deliver your project within the agreed budget, schedule & outcome, however, if your stakeholders are not satisfied, your project is considered as a failure.
In fact, the single most important criterion of project success is stakeholder satisfaction.
Let’s be practical – you cannot satisfy all your stakeholders. Project stakeholders may have conflicting interests. Some of them might even want to sabotage your project or get it cancelled.
As the project manager, you have to quickly find those project saboteurs and understand the reasons why they are against the project.
Sometimes stakeholders may pressure you and team into changing the scope & objectives of your project.
Stakeholder influences varies depending on the phase of the project. In the beginning, when the objectives of the project are being developed, stakeholder influence is likely to be weak.
In the planning phase, stakeholders may become more involved as the outcome of the project starts to take shape. When the implementation phase of your project starts producing outcomes that impact the stakeholders, pushback starts increasing and may reach it’s pinnacle during the closing phase.
For example, if you are managing a project w
And you have to understand how your stakeholders will benefit from the outcome of your project.
You’ll have stakeholders who’ll always be favorable or not to your project.
Why should I do a Stakeholder Analysis?
Stakeholder analysis is essential to the success of your project. Successful project managers do stakeholder analysis early on.
Such an analysis helps a project manager identify people/organizations who can impact the project. So put together a list of the stakeholders early on, and reach out to them. Doing so will help you establish a relationship with the stakeholders who matter, understand their opinions/positioning, and plan your project so that it considers the requirements of these stakeholders.
You’ll have a head start as you’ll win support early on for the project. You’ll also factor in the needs of the powers that be, and able to better negotiate more resources (financial, people, time, assets, etc.).
The 3 steps involved in Stakeholder Analysis
There are 3 steps to follow in the Stakeholder Analysis Process:
Step #1: Identify Your Stakeholders
The first step in Stakeholder Analysis is to identify the project stakeholders. To do this, think of all the people that may be affected by your project.
To help you, here is a list of the most common types of Stakeholders:
- Your supervisor
- The project sponsor
- Project team members
- Senior executives
- Alliance Partners
Some of the Stakeholders above list are organizations. However, you will be dealing with specific people in the organizations. Identify those people.
As your project progresses, new stakeholders may get involved, and you’ll have to update your stakeholder list. Therefore, we recommend that you periodically review the stakeholder list throughout the project to ensure that you haven’t missed out on someone.
Step #2: Prioritize Your Stakeholders
Now that you have a complete list of all stakeholders in your business, you need to understand who has the most influence over your project, who will benefit the most from the project’s outcome, and who has resources that you can use.
Use the stakeholder map below to prioritize your stakeholders depending on their levels of influence and interest. The map has 4 quadrants that categorize and divide the stakeholders into 4 sectors depending on their level of interest and influence as follows:
Monitor stakeholders with low interest and low influence.
Simply keep an eye out for these stakeholders and occasionally evaluate if any changes are happening. There are possibilities that stakeholders here might shift to other categories, so it is still important to monitor this group instead of just ignoring them. But remember to limit the time you spend on this group.
Satisfy stakeholders with low interest and high influence.
Always keep these stakeholders happy. You need to build good relationships with this group. These stakeholder care very little for your project as long as they are satisfied. By building good connections with these stakeholders, you can reach out to them to help out with your project.
Inform stakeholders with high interest and low influence.
This group has no or very little power to intervene in your project. However, the feedback coming from these stakeholders is important since it is in the best interest of your project. Ensure that you regularly inform and approach this group proactively and schedule appointments and meetings. Regularly interact with this group and collect feedback that can help you with your project.
Collaborate closely with stakeholders with high interest and high influence.
The stakeholders in this category should be the top priority for your business. Not only do they have a great deal of interest in your business, but they have a lot of power that can help determine success. Collaborate and work together proactively. Build a strong relationship with these stakeholders. It is crucial to gain their trust and support as their influence can help your business.
Step #3: Understand Your Key Stakeholders
After you categorize and prioritize stakeholders, the next step is understanding how your key stakeholders feel about your business.
Here’s a list of questions that can help you understand your stakeholders better:
- Do your stakeholders have a financial or emotional interest in the outcome of your business?
- What motivates your stakeholders the most?
- What information do they want from your business?
- What is the best way of communicating with your stakeholders?
- What is their current opinion of your business?
- Is there anyone influencing their opinions?
- If they are not likely to support your business, what can you do to gain their trust?
- If you can’t get their support, what can you do to manage this opposition?
As your project progress, so will the number of stakeholders involved. It isn’t easy to keep your focus and, at the same time, satisfy all the stakeholders of your project. That is why it is essential to perform a Stakeholder Analysis to help you determine the stakeholders you need to focus on instead of trying to please everyone. Use the 3 step process outlined above (identify, prioritize & understand).
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