Stakeholder is a very broad concept used in systems engineering and project management. In particular, the term is actively used in the PMBoK (a serious framework for managing complex projects), ISO 9000 (a set of standards dealing with quality management) and ISO/IEC 42010.
Let’s define it and look at the main aspects of managing stakeholder expectations in modern projects.
Terms
A stakeholder is a person or organisation, any involved party that can influence a project or system. Not only stakeholders can influence the project, but also its participants, users of the final product and any other subjects, including those that can be influenced by the product or system itself.
The main role of the stakeholder is to gather and shape the requirements for the project.
It is ideal if the final product fully meets the expectations of its users. This will give you a better reach and increase sales. Nothing personal, just marketing.
But as Henry Ford said, ‘If you asked people what they wanted, they would ask for a faster horse. This quote illustrates the fact that the expectations of customers, employees, shareholders and other stakeholders can and should be managed.
How to manage stakeholders and their expectations?
In management theory, stakeholders can influence various external and internal factors of a project:
- investment,
- quality management,
- risk management,
- requirements definition,
- etc.
But what is stakeholder management?
The project team must first create the most comprehensive list of all stakeholders (identify them) and then determine the extent of their influence, attitudes, and interest in the project. Once the list of stakeholders is complete and their status is determined, you can move straight into the process of managing expectations.
In reality, these are all actions that directly or indirectly influence the change of the stakeholder’s status to the desired (favourable) state.
A simple example: you have determined that the designer is one of the most important stakeholders in the project. His positive attitude is very important to achieve the desired result. But his current motivation is insufficient, his status is lower than required by the matrix. Identify his needs and, if possible, address them so that the designer moves to the «sufficiently motivated» status.
Motivational measures and actions in general can be of any kind, no one specifies them separately: a pay rise, a revised schedule, additional equipment for the workplace, additional training, and so on. These are all specific tasks and actions. To manage stakeholder expectations, only a change of status is important.
Treat it as a separate business process.
Who can be a stakeholder
Stakeholder identification is the most important stage in the process of planning a project and its environment.
The most common stakeholders are the following groups of participants:
- Client — the buyer or customer of a project, the recipient of a service or result.
- User — the person or persons who will use the final product.
- Developer — here it is possible to divide into different statuses and positions: programmer, designer, tester, etc.
- Supplier — a natural or legal person who provides any resources and auxiliary, related services.
- Investor — the sponsor of the project.
- Inspector — any inspection body or representative of the customer or supplier.
- Project Manager — the person who acts as an intermediary between the customer representatives and the implementers and is responsible for planning and resource allocation, reporting and other management functions.
- Liquidator — the person who will settle the project and technical debts in the event of project termination.
- Support Specialists — technical, legal, information and other support for the product.
This is by no means an exhaustive list of all possible stakeholders. It may include society, public authorities (because of the legislative/regulatory acts they adopt) and others.
Roles can have internal divisions. For example, users can be privileged (with paid subscriptions of different levels), new and regular, without special rights, etc.
It should also be remembered that the attitude and influence of stakeholders can vary significantly depending on the current stage of project implementation.
Let us recall the main stages through which most projects pass:
- Analysis and design.
- Direct development.
- Handover to the customer or client.
- Maintenance.
- Operation.
- Liquidation.
Level of engagement — stakeholder expectations
Ideally, when planning a project and compiling a list of all the stakeholders, it would be desirable to identify in detail all the possible situations in which the stakeholders can influence the project for each of its phases.
But this is quite difficult and time consuming. Many people forget to manage expectations. So balance is important. You need a methodology that is simple and easy to understand, especially if you have no experience in this area.
What approach do experienced project managers recommend?
- A matrix of influences and attitudes is created. It is very similar to the Eisenhower matrix we discussed in ‘How to prioritise your work‘. On the vertical axis the influence increases, on the horizontal the attitude (negative at the bottom, positive at the top). The following four boxes are created: project detractors — dangerous on the right and non-dangerous on the left, well-wishers — important on the right and with low influence on the left.
- A similar matrix is created for the relationship between interest and influence.
This gives you a clear and easy to understand status of the project stakeholders. Based on this, you can create an appropriate action plan to manage expectations.
Stakeholder expectations management plan
The planning form can take any form, the main thing is that it should be visual, easy to read and the actions described in it can be easily understood and converted into tasks for use in your corporate task manager.
What to include in the plan:
- Identify the stakeholder group or specific individuals with a status link.
- The status of their influence on the project before work starts (can be broken down into stages of the project lifecycle, as discussed above).
- What stakeholder status is planned (desired/required).
- What activities are planned to change the status.
- What is the timeframe (frequency, fixed date, linked to specific events, e.g. +N days from start…)?
- Other stakeholders and those responsible for the event. For example, those through whom the action will be carried out.
- Numerical and other indicators to measure the success of the action.
- Resources used/required — tangible and intangible, e.g. contact details, budget allocated, associated costs, etc.
To make sure you don’t forget or overlook anything, use BPM systems such as Projecto.
