The Strategic Importance of Stakeholder Management
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1 The Strategic Imprtance f Stakehlder Management Birds f a Feather Discussin Ntes PMI SAC Prfessinal Develpment Cnference Nvember 24, 2009 Prepared by: Shail Thaker, Assciate Partner Ethier Assciates 600, Avenue S.W., Calgary, AB T2P 3T7 Phne: (403) Fax: (403) inf@ethierassciates.ca
2 Birds f a Feather Sessin Tpic Infrmatin Tpic Title: Tpic Descriptin: Facilitatr Name: The Strategic Imprtance f Stakehlder Management Stakehlders make r break a prject, and ften Prject Managers d nt spend the time t effectively manage the stakehlder relatinship t the prject s disadvantage. This sessin will cver tips and techniques frm the sessin hst and will slicit ideas. Shail Thaker, MBA, PMP Facilitatr Bi: Shail Thaker is an Assciate Partner with Ethier Assciates. Shail brings ver 22 years experience t the firm, with his last 10 years cnsulting with Ethier. He has previusly wrked in Africa, India and Eurpe, has an MBA and a PMP. Shail has extensive experience in prject management (traditinal, Agile and Scrum), prgram management, business analysis, business prcess innvatin, change management, and facilitatin. Shail has been managing prjects fr many years and has managed stakehlders using his understanding f hw t identify and then meet their expectatins. sthaker@ethierassciates.ca Cntact Number: Website: BOF Discussin Ntes Page 2
3 Understanding Stakehlders Discussin Stakehlders make r break a prject, and ften Prject Managers d nt spend the time t effectively manage the stakehlder relatinship t the prject s disadvantage. T be successful, Prject Managers need t learn hw t leverage the stakehlder relatinship and hw t balance their cmpeting needs. Stakehlders: Definitin The individuals and grups wh depend n the Prject t fulfill their wn gals and n whm, in turn, the Prject depends n, are called Stakehlders. Imprtant t knw abut the differing expectatins and differing definitins f prject success that each stakehlder pssess Determine t what extent they culd r wuld exert their influence? Pwer Extent that they are able t persuade, induce, r cerce thers int fllwing certain curses f actin Exert pwer thrugh direct authrity, lbbying, r taking a psitin Surces f Pwer Hierarchy frmal pwer, infrmal pwer, access t senir decisin makers Cntrl f strategic resurces (e.g. budget, peple) and the relative percentage in cmparisn t thers Pssessin f knwledge and skills (e.g. specialized infrmatin) Cntrl f the envirnment (e.g. physical, cmmunicatins netwrk in rganizatin) Invlvement in strategy implementatin (e.g. participatin in crprate directin setting) Representatin in pwerful rganizatins (e.g. membership n influential cmmittees) Grup Discussin: What are sme f the status symbls that help us identify wh has pwer? BOF Discussin Ntes Page 3
4 Stakehlder Management PM Respnsibilities re: Stakehlder Management Understand stakehlders Manage stakehlders Meet needs and expectatins f stakehlders Maintain engagement - custmize cmmunicatin based n the abve PM needs t pssess the fllwing excellent and mature cmmunicatin skills: Verbal Unambiguus Written Accurate, hnest & cmplete Presentatin Audience sensitive Cncise / Clarity Curageus Danger Signals PMs pay attentin t Danger Signals frm stakehlders Interference with prject (withut cnsulting with PM first) Nt prviding supprt when needed Nt attending key meetings Pr cmmunicatin t many layers between PM and stakehlder Making unfunded cmmitments & prmises Grup Discussin: What ther Danger Signals shuld the PM be lking fr? BOF Discussin Ntes Page 4
5 Impact f Stakehlders n Prjects Prjects Prjects are temprary endeavrs Given the rganizatinal structure f prjects, and the impact that stakehlders have n prjects, Prject Managers: Have little frmal authrity ver stakehlders Must use persnal pwer t influence Are respnsible fr regular, planned & ad-hc cmmunicatin Must establish a gd relatinship with the prject spnsr Must maintain nging relatinships with stakehlders Typical Prject Organizatin Structure STAKEHOLDERS Prject Oversight Prject Spnsr Prject Steering Cmmittee Prject Team Prject Manager EXTERNAL STAKEHOLDERS Business Leader Subject Matter Experts (SMEs) Technical Leader Technical Experts INTERNAL STAKEHOLDERS BOF Discussin Ntes Page 5
6 Examples f Internal vs. External Stakehlders Internal Stakehlders Prject Spnsr Functinal Departments (e.g. Marketing, IT) Crprate Leadership Other Prject Teams Emplyees Unins External Stakehlders Custmers Regulatry / Gvernment Cmpetitrs Jint Venture Partners Vendrs Investrs / Sharehlders Organizatin Structure - the prject will tend t take n a structure and maturity similar t the rganizatin. Understanding the crprate structure (and its stakehlders) can help when trying t identify stakehlders fr a prject. Recgnize that the cmpany rganizatin structure is lng-standing and is supprted by established lines f cmmunicatin, frmal and infrmal. The prject is temprary and des nt have the advantage f these established lines f cmmunicatin. PROJECT SPONSOR STEERING COMMITTEE CEO / CHAIRMAN BOARD PROJECT MANAGER PRESIDENT r COO BUSINESS LEADER I S LEADER VP VP PROJECT ORGANIZATION COMPANY ORGANIZATION BOF Discussin Ntes Page 6
7 Stakehlder Analysis The fllwing diagram can be used t get an understanding f the stakehlders in terms f tw metrics; Pwer and Level f Interest. BOF Discussin Ntes Page 7
8 Stakehlder Analysis - Recmmendatins 1) Use the abve analysis technique t understand the current stakehlder landscape 2) Identify current psitin and pririty f stakehlders May need t break large grups int smaller grups (e.g. IT) 3) Identify supprters and ppnents Identify what each stakehlder needs/expects frm the prject, risk tlerance, level f supprt, agenda fr supprt r ppsitin 4) Determine if repsitining is required? If repsitining a stakehlder is required - determine what needs t be dne t shift pwer? e.g. Invlve stakehlder in early stages f planning e.g. Invite stakehlder grup - team members t key planning meetings 5) Maintain engagement Similar t risk management, use this analysis when planning stakehlder cmmunicatin Prepare specific cmmunicatin strategy per grup 6) Maintain currency Update the stakehlder analysis fr each stage f the prject Update t reflect changes t the stakehlders (e.g. peple leaving, added) 7) Critical stakehlders / steering Cmmittee train n rles & respnsibilities If stakehlders are n the Steering Cmmittee - help them understand their rle Prvide them with training n prject gvernance/versight s they can be successful Dn t assume they knw hw t versee a prject Grup Discussin: What challenges have yu faced with managing stakehlders? Hw d yu manage stakehlders that are in resistance? What skills have yu seen, are necessary, t successfully manage the stakehlders? BOF Discussin Ntes Page 8
9 References: C8007B4540/$File/Visuals%20Prject%20Oversite%20CMA%20MAY% pdf?OpenEle ment BOF Discussin Ntes Page 9
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