Project Management

Manage Your Stakeholders! The Key to Your Project’s Success!

 

Project stakeholders are individuals and organizations that are actively involved in the project, or whose interests may be affected as a result of project execution or project completion. Take it from me – these are the people you need to pay the most attention to. They need to be identified in your planning – especially in your communication plan.  They may also exert influence over the project’s objectives and outcomes. The project management team must identify the stakeholders, determine their requirements and expectations, and, to the extent possible, manage their influence in relation to the requirements to ensure a successful project. They can make or break a project!

 

Stakeholders have varying levels of responsibility and authority when participating on a project and these can change over the course of the project’s life cycle. Their responsibility and authority range from occasional contributions in surveys and focus groups to full project sponsorship, which includes providing financial and political support. Stakeholders who ignore this responsibility can have a damaging impact on the project objectives.

 

Likewise, project managers who ignore stakeholders can expect a damaging impact on project outcomes. Sometimes, stakeholder identification can be difficult. For example, some would argue that an assembly-line worker whose future employment depends on the outcome of a new product-design project is a stakeholder. Failure to identify a key stakeholder can cause major problems for a project. For example, late recognition that the legal department was a significant stakeholder in a year 2000 rollover (Y2K) software upgrade project caused many additional documentation tasks to be added to the project’s requirements.

 

Stakeholders may have a positive or negative influence on a project. Positive stakeholders are those who would normally benefit from a successful outcome from the project, while negative stakeholders are those who see negative outcomes from the project’s success. For example, business leaders from a community that will benefit from an industrial expansion project may be positive stakeholders because they see economic benefit to them community from the project’s success. Conversely, environmental groups could be negative stakeholders if they view the project as doing harm to the environment. In the case of positive stakeholders, their interests are best served by helping the project succeed, for example, helping the team to acquire the needed permits to proceed. The negative stakeholders’ interest would be better served by impeding the project’s progress by demanding more extensive environmental reviews. Negative stakeholders are often overlooked by the project team at the risk of failing to bring their projects to a successful end.

 

Key stakeholders on every project include:

 

Project manager. This is the person responsible for managing the project.

Customer/user. This refers to the person or organization that will use the project’s product. There may be multiple layers of customers. For example, the customers for a new pharmaceutical product can include the doctors who prescribe it, the patients who take it and the insurers who pay for it. In some application areas, customer and user are synonymous, while in others, customer refers to the entity acquiring the project’s product and users are those who will directly utilize the project’s product.

Performing organization. This refers to the enterprise whose employees are most directly involved in doing the work of the project.

Project team members. This is the group that is performing the work of the project.

Project management team. These are the members of the project team who are directly involved in project management activities.

Sponsor. This is the person or group that provides the financial resources, in cash or in kind, for the project.

Influencers. People or groups that are not directly related to the acquisition or use of the project’s product, but due to an individual’s position in the customer organization or performing organization, can influence, positively or negatively, the course of the project.

PMO. If it exists in the performing organization, the PMO can be a stakeholder if it has direct or indirect responsibility for the outcome of the project. In addition to these key stakeholders, there are many different names and categories of project stakeholders, including internal and external, owners and investors, sellers and contractors, team members and their families, government agencies and media outlets, individual citizens, temporary or permanent lobbying organizations, and society-at-large. The naming or grouping of stakeholders is primarily an aid to identifying which individuals and organizations view themselves as stakeholders. Stakeholder roles and responsibilities can overlap, such as when an engineering firm provides financing for a plant that it is designing. Project managers must manage stakeholder expectations, which can be difficult because stakeholders often have very different or conflicting objectives.

 

For example:

 

The manager of a department that has requested a new management information system may desire low cost, the system architect may emphasize technical excellence, and the programming contractor may be most interested in maximizing its profit.

The vice president of research at an electronics firm may define new product success as state-of-the-art technology, the vice president of manufacturing may define it as world-class practices, and the vice president of marketing may be primarily concerned with the number of new features.

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October 23, 2008 - Posted by | Communications Management, Project Management | ,

1 Comment »

  1. Great comment and I loved the links you left!

    Donna

    Pingback by Stakeholder Management - The latest in the voluntary project : How to Manage a Camel - Project Management and Recruitment | October 24, 2008 | Reply


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