Cheryl Yeoh said, “The best way to minimize disagreement is to ensure all the stakeholders are in the room.”
This statement/quote signifies the sine qua non of the stakeholders’ participation in a business initiative/project and the management of such stakeholders for positive outcomes/deliverables/business payoffs. Stakeholder management is the warp and woof of any business/project/assignment. With effective stakeholder management only, it leads to the capstone of successful thriving projects. Before going through the strategies of effective stakeholder management for project success, let's delve into the vignette of Stakeholder Management.
Who are the stakeholders in the project/business? They are customers, employees, investors, suppliers, community, and government regulations. Stakeholders are those individuals/groups/regulatory frameworks that possess a vested interest in the project, and whose participation impacts upon the final deliverables of the project. Stakeholder management entails the act of identifying, and understanding those stakeholders along with managing solid relationships with them. Sometimes, the scenario can be you Vs them aka project head/manager versus stakeholders. Still, it is the responsibility of the project managers to effectively manage and handle them with the objective of no negative aftermath in the project. The caliber of the leadership of the project manager concatenates the stakeholders with the project team members’ competence to meet their expectations and interests. In fact, the role of stakeholders is so immense that they determine whether the project is going to succeed or fail.
Hence, stakeholder management indicates the process of managing the kinship with stakeholders for positive project outcomes. Due to several complications around the globe, stakeholder management has become one of the much-needed ancillary skills for the project manager. Along with strategizing, mitigating, and converting catch-22s into opportunities, stakeholder management has also evolved as the preeminent concern for project managers.
It's clear about the importance of effective stakeholder management for project success but there are several red flags that indicate difficult stakeholders at any cost, they need to be managed such as:
i) Slumbering communication among stakeholders
ii) Pass on negative comments/remarks on a frequent basis
iii) Not showing interest in the project or lack of proper attention to the project
iv) Backing off from the project prematurely
v) Frequent arguments with unreasoned conclusions
When these tip-offs spring up, they may cause casualties for both the project and the project manager. Hence, the project manager needs to come up with various strategies for effective stakeholder management for the project's success. Find out the surefire strategies for maintaining solid relationships with the stakeholders.
The project lassitude or project delay may occur if the stakeholder management doesn't stay on track. The first and foremost task of a project leader is to identify the stakeholders with close observation. Whether the stakeholders are internal or external, the categorization must be done. Similarly, the stakeholders should be categorized into:
i) Primary stakeholders (Beneficiaries like customers)
ii) Secondary stakeholders (Project supporters like team members)
iii) Key stakeholders (Strong influencers like investors)
Hence, this process includes the stern analysis of the stakeholders of direct and indirect participation in the project. For this process, various sessions should be facilitated such as stakeholder interviews, surveys, questionnaires, organizational charts, and brainstorming that may portray a stakeholder map for the required efforts to be taken for each kind of stakeholder. The project manager should have an understanding of the involvement of each stakeholder and needs to determine the motivational factors for each of them. The following questions should be addressed for determining motivation.
i) What factors influence those stakeholders?
ii) What is the possible way of communicating with them?
iii) What requirements do they prefer for precise details on a project?
iv) What are the reasons for stakeholders’ resistance?
For all these, clear goals and expectations should be set at the beginning of the project lifecycle so that each understands the project motives clearly along with the effects of project outcomes on them.
For the successful completion of any project, the project manager or team leader should understand the stakeholders. The roles of the stakeholders should be analyzed by conducting the RACI matrix. Their attitudes, level of authority, power, and influence should be understood. As mentioned above, to understand the needs and motives of the stakeholders, project managers should put themselves in their shoes to understand their values and opinions. They may have a diverse array of interests and needs. By understanding their needs only, effective lines of communication can be selected.
The project manager can use tools/software like stakeholder analysis matrix, and power/interest grid that help in tailoring the best communication strategies for the stakeholders. To understand their needs, project managers should allocate certain time for one-on-one meetings with the stakeholders to clarify their viewpoints. Active listening should be preferred. Flexibility should be adapted and finding people the best project roles that suit their interests and talent should be emphasized. If required, training and development programs should be introduced.
What if there are no regular updates on project progress and sudden obstacles to the stakeholders? There will be a communication gap between the project and the stakeholders. Hence, there should be a rigorous analysis of the best communication methods after understanding their interests and needs. They should be well-informed and updated at each track of the project so that trust and transparency can be maintained within the whole project lifecycle. There should be incorporation of a mix of direct and indirect communication, conflict resolution mechanisms, stakeholder feedback sharing, and alignment of stakeholder expectations with the project goals. The stakeholder relationship can be fostered only if open communication is practiced.
Let's take one example or Scenario of a website company whose ultimate project is to make a website for an IT company. However, the client always passes on negative remarks and addresses new changes at the end of each stage of the website-making project. His/her frustrating but frequent changes are the sort of challenge for the project manager to tackle and manage that stakeholder effectively to maintain a healthy and sound relationship. So for the scenario, like the strategies mentioned above, he/she should embrace them like identifying the type of stakeholder, understanding the client’s interest and needs through one-on-one meetings with mitigation and negotiation techniques, and frequently communicating about project progress and updates.
What other strategies should be followed by the project managers?
i) Stakeholder engagement is also a part of effective stakeholder management. Hence, collaboration, resolving problems, and managing their expectations are some of the prodigious methods of stakeholder engagement. Also, monitoring stakeholder engagement is a must.
ii) According to the Project Management Institute (PMI), the integration of project management risk principles and project management leadership is key to improved stakeholder management success and it should be followed.
iii) Adapting a change management framework for stakeholder engagement is also commendable.
iv) Utilization of collaborative platforms and social media tools is best used for real-time engagement and inclusive work involvement despite any geographical and time barriers.
v) Project management software with a bunch of features like real-time dashboards, customized metrics, and numerous traits make the work easier backed up by leveraged technology and trends in project management.
vi) Data analytics usage is one of the best approaches to reinforce the stakeholders’ relationships by analyzing trends and matrices.
In terms of stakeholder management, communication is the keystone for effective stakeholder management. The conflicts in the projects such as Scope Creep, inflexible work module, etc can be demoted with communication. Hence, incorporating communication channels with strong stakeholders’ participation is the sole reason for successful project delivery.