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By Jane Suchan, PMP

So just what is a project stakeholder?     There are many definitions, and they vary from source to source and company to company. All suggest that stakeholders are people or groups who have a vested interest in the outcome of a project. Stakeholder management is synonymous with relationship management: the goal is to gain and sustain commitment to your project.

Herein, stakeholders are individuals or groups in the organization who have an interest in, or will be affected by, the project result. But before starting the exercise of establishing and managing your stakeholder list, make sure that your definition of a stakeholder aligns with that of your organization.

Why is managing stakeholders important?

As much as we'd like to think this isn't the case, we have to face the fact that not everyone will be 100 percent enthusiastic about the project. Stakeholders may have to learn new tools or processes, relinquish control, or in some extreme cases, lose their job. The burden falls on the project manager and sponsors to ease stakeholders' concerns, and it's unlikely that you'll be able to make all people happy, all the time. Some will need to be handled in such a way that they can't sabotage your efforts.

Understanding motivations will help you address concerns and avoid negative behaviors and tactics, such as:

  • Delaying needed inputs or approvals.

  • Starting a competing project.

  • Reassigning resources to other projects.

  • Engaging in back-room politicking to undermine the project.

The benefits of effectively managing stakeholders are:

  • Reducing project cycle time by keeping it from being bogged down in politics.

  • Streamlining the approval process.

  • Helping to ensure that project resources are available and remain focused.

  • Keeping information flowing.

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Develop a stakeholder list

Early in the project, work with your project sponsor to create a list of all possible stakeholders. Depending on how you define this role, and the impact your project will have on the organization, this list may be long.

The stakeholder list is a tool for the project manager and a key input for the project communications plan. Based on the assessment of your list, you can plan a strong communications strategy. And, you don't need to share the list details beyond the project sponsor.

With most projects come politics, so expect to stumble into some murky waters when you're assessing your stakeholders.

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Assess the stakeholders list

Determine each stakeholder's clout, and categorize them by level of influence. Some will have the power to keep a project moving forward. This may include the project sponsor or senior managers. Because of their positions and decision-making roles, you'll want to monitor these stakeholders closely. Others may be people who, although they can't pull the plug on a project, may work behind the scenes to undermine and possibly even end it.

Another level of stakeholders are those who will live with the product — sometimes on a daily basis. This group provides input in the form of business requirements that must be met. They have the most to gain if the project is successful, because it will affect them directly. Although they often can't directly or indirectly end a project, they are nonetheless vital to its success. If their needs or concerns are not met, they will quickly go from being your biggest supporters to your biggest problem.

Another way to organize stakeholders is to group them by level of involvement and responsibility. One group might be actively involved in the project and doing the work, another might be engaged at some point, and yet another might be stakeholders who are not actively engaged but must receive communications about the project.

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Use RACI to categorize stakeholders

Responsible, accountable, consulted, and informed (RACI) is a tool used in organizational design to assign and designate stakeholders by level of project involvement and responsibility. It's a useful way to categorize your stakeholders so you can plan the most effective communications strategy for each person or group. These stakeholders are defined as follows:

  • Responsible    This person is responsible for completing a task.

  • Accountable    This person will be called to account if the task is not completed and may manage the person who is responsible for completing the task. Project managers often have this role.

  • Consulted    Though not accountable or responsible for completion, this person is consulted about aspects of the task.

  • Informed    The holder of this passive role is kept informed but isn't accountable or responsible for tasks.

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An ounce of prevention …

Project management is all about managing expectations. Take the time early in your projects to work with your sponsor to identify and assess your stakeholders. Be sure to update your list throughout the life of the project. You must know who your stakeholders are and their interests to effectively manage them. It will save you from difficulties in the long run and ensure that your project is successful.

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About the author     Jane Suchan is a program manager with experience managing enterprise business initiatives and developing project management methodologies. Jane lives in Seattle, Washington.

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