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When working on a big project, it's important to figure out who the key people are interested in and how the project turns out.
These key people are called "stakeholders." Stakeholders can be anyone impacted by the project's results, people who provide resources or funding, or those who have a say in making important decisions about the project.
If you don't take the time upfront to identify all the stakeholders, it can cause many problems.
You might miss getting input from someone important or fail to keep people who need to be informed in the loop.
This can lead to misunderstandings, conflicts, delays, or even cause the project to get derailed entirely.
Taking the step to carefully identify all the stakeholders from the very beginning is crucial.
It allows you to ensure you have all the right people involved and buy-in to the project goals.
It helps you understand everyone's needs and interests so that you can address them properly. Identifying stakeholders sets you up for a smoother, more collaborative project where everyone is on the same page.
Identifying stakeholders is a crucial first step in effective project management, particularly in Scrum projects. It allows the team to recognize all parties who have a vested interest in the project's outcome, from end-users and clients to sponsors and regulatory bodies.
If you don't loop in all the people who have an interest in the project upfront, you're going to run into issues later. Maybe there's someone important you missed getting input from initially, and now they're unhappy with the decisions that were made. Or there could be a group impacted by the changes you didn't even realize, and now they're throwing up roadblocks. Taking the time to map out all the stakeholders avoids these kinds of preventable fires.
When you involve the stakeholders early by making them aware and getting their perspectives, it aligns everyone's expectations. They understand the goals, the priorities, and why certain decisions are being made. This really helps get their buy-in and commitment to making it a success.
Among all those stakeholders, there will be some that can be champions for the changes and clear hurdles for you. And there may be others who will resist or try to block progress. By identifying them upfront, you can plan how to best leverage the supporters and directly address the concerns of the resistors.
In some lines of work, you actually have to document that you identified all impacted stakeholders as part of the official process and paperwork. Following these rules prevents bigger legal or financial problems down the line.
The main thing is that starting by pinpointing all the stakeholders is like doing pregame prep and warmups before a big game. It's that crucial first step that puts you in the best position to make the project a slam dunk instead of an airball. A little effort upfront prevents a whole lot of headaches later.
Four steps are needed to determine your key stakeholders and use their insights in your project or consultation.
Identifying potential stakeholders involves considering everyone who might be interested in or affected by your business. This includes both those within your organization (internal) and those outside it (external). Here’s how to approach this step comprehensively:
Internal Stakeholders:
Employees: Every level of employee, from frontline workers to senior executives, has a stake in the business. Employees are affected by company policies, workplace conditions, and overall business performance.
Managers: Mid-level and senior managers are crucial as they implement strategies and policies. Their support and feedback can significantly impact the success of business initiatives.
Board Members: These are the decision-makers who guide the strategic direction of the company. Their approval and oversight are essential for major business decisions.
Departments: Different departments like HR, finance, marketing, and operations may have specific interests and impacts on various projects.
External Stakeholders:
Customers: The lifeblood of any business. Their needs and satisfaction levels directly influence the company’s success. Understanding their preferences and feedback is vital.
Suppliers: These are businesses that provide goods or services to your company. Maintaining good relationships with suppliers can affect the quality and cost of your inputs.
Investors: Individuals or entities that have invested capital into your business. They are concerned with the financial performance and return on investment.
Regulators: Government bodies and industry regulators ensure that your business complies with laws and regulations. Their requirements can significantly impact business operations.
Community Groups: Local communities where your business operates. Their perception of your company can influence your social license to operate and community relations.
Competitors: While not traditionally seen as stakeholders, understanding your competitors can provide insights into market dynamics and strategic opportunities.
Partners: Other businesses or organizations you collaborate with. Their success can be closely tied to yours, and maintaining good partnerships can open new opportunities.
Taking the time to identify and list potential stakeholders thoroughly sets the stage for effective stakeholder management, ensuring that your business decisions are well-informed and supported by all relevant parties.
Analyzing stakeholders' influence and interest helps prioritize engagement strategies. It ensures that efforts are concentrated on those who can significantly impact the project’s success, either positively or negatively, thus optimizing resource allocation and communication strategies.
Assess Influence and Interest Levels: Evaluate each stakeholder’s level of influence over the project and their interest in the project's outcomes.
Use Analytical Tools: Employ tools such as the Stakeholder Influence/Interest Matrix to categorize stakeholders into quadrants: high influence/high interest, high influence/low interest, low influence/high interest, and low influence/low interest.
Prioritize Stakeholders: Based on the analysis, prioritize stakeholders to focus engagement efforts on those with the highest influence and interest.
After determining key attributes, stakeholder mapping is the optimal method for identifying your primary stakeholders. Stakeholder mapping involves plotting stakeholder attributes onto a chart to visualize and compare their positions, facilitating the analysis of stakeholders based on these attributes.
Common stakeholder mapping techniques include matrix models, grids, Venn diagrams, relationship network diagrams, and multi-dimensional stakeholder maps. For additional information, refer to our example stakeholder diagrams or download our stakeholder mapping templates.
Post-mapping, you can categorize stakeholders into groups for customized engagement strategies and communication.
In addition to stakeholder mapping, identifying key stakeholders can also be achieved by asking pertinent questions. As you advance in your engagement process and interact with or survey stakeholders, you will gain deeper insights. Thus, remain open to updating your list of key stakeholders as you acquire more information.
After identifying key stakeholders, how should you utilize that information?
You'll need to engage with your key stakeholders more promptly and frequently than others. Therefore, organize your stakeholder records to facilitate easy engagement and tracking.
In Simply Stakeholders, a highly effective practice is to use contact groups (our segmentation features) to efficiently monitor your key stakeholders and plan your engagement strategies.
The dashboard is also useful for drilling down to see if you've engaged with these influential, interested, or impacted stakeholders. This includes checking whether you’re connecting with the appropriate individuals and how recent these engagements have been.
It's advisable to regularly report on activities, sentiments, and feedback specific to your key stakeholders. Their feedback and sentiments are generally more significant than those from other stakeholders. This feedback can be used to refine and enhance your engagement efforts.
Pinpointing stakeholders for your enterprise is a critical initial move in creating efficient communication, handling relationships, and securing successful results. Identifying and comprehending their needs, expectations, and possible impacts allows you to customize strategies that align with their interests. This tactical approach improves collaboration, reduces risks, and cultivates a positive reputation, forming the basis for sustainable growth and resilience in a constantly evolving business landscape.
Become an expert at handling stakeholder dynamics. Enhance your project success by enrolling in the Professional Scrum Product OwnerTM - Advanced (PSPO-A) course.
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Stakeholders can be categorized based on their level of influence and interest in the project. Common categories include primary (directly impacted), secondary (indirectly impacted), and key (those with significant influence).
Conflicting interests can be managed through negotiation, seeking common ground, prioritizing issues based on project goals, and transparent communication.
Common challenges include overlooking key stakeholders, misjudging their influence or interest, and failing to update the stakeholder list as the project evolves.
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