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IDENTIFY STAKEHOLDERS Process Group: Initiating Knowledge Area: Project Communications Management

n identifying stakeholders, it will first be beneficial to refreshen our memory on who stakeholders are and the rationale behind the need to identify them.

Primarily, we say project stakeholders are persons or organizations with a stake/interest on a project. This definition may be okay on a high-level. But as aspiring PMPs, we may need to go deeper. By going steps further, we may look at stakeholders in two-way dimensions.

First of all, we define stakeholders as persons or organizations who can impact or be impacted by the project and its outcome positively or negatively.

To be much clearer, there are those stakeholders who can impact the project execution and outcome [e.g. a project sponsor], and those who can have no such direct impact but on whom the project can have an impact.

Please note that in either case, the impact could be positive or negative. For instance, if a project sponsor failing to provide funding to a project at an expected time could lead to delay.

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Identify stakeholders is the process of identifying all persons or organizations who can impact or be impacted by the project and its outcome and documenting details regarding their interests, level of involvement, influence and impact on project success.

Identifying all stakeholders associated to a project may seem a daunting task. You can however start from identifying the very obvious ones such as the project manager himself, project sponsor, PMO, project team members, program manager, portfolio manager, relevant functional managers, etc. Then you move to the less apparent ones within and outside of the organization.

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Then, to analyze and record details of each identified stakeholder as follows: o What is this stakeholder’s interest on the project? o What will be their level of involvement? o What is their influence, power, importance, or impact on the project? o Where on the project are they connected as stakeholders? At what time

will they exert influence?

It is important to know these in order to develop an appropriate strategy to approach and manage each stakeholder throughout the project. Classifying stakeholders by these parameters can also help the project manager and his team focus on relationships necessary to ensure success on the project.

INPUTS

1. Project charter

Notice that a project charter will spell out what we are doing in the first place. And by knowing what deliverable the project is expected to create, we can begin to elaborate on which people can impact and/or be impacted by the project.

A project charter can also furnish us with some persons, groups or organizations involved on the project. Take a look at the preparation of the project charter again. All the people and organizations enlisted [like the project manager himself, project sponsor, team members, program manager, portfolio manager, etc.] are already stakeholders.

Tools & Techniques Inputs Outputs

1. Project charter 2. Procurement documents 3. EEFs 4. OPAs

1. Expert judgment 2. Stakeholder analysis

1. Stakeholder register 2. Stakeholder management

strategy

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2. Procurement documents

If the project is to be performed by an external organization, all parties involved in the contract are key stakeholders on the project. All identified suppliers are stakeholders while those to be identified in advance can later replenish the stakeholder register by iteration.

4. EEFs

There is the need to take a look at Enterprise Environmental Factors that would help identify and furnish information to analyze stakeholders. One such EEF is the organization’s culture since stakeholders usually behave differently under different organizational culture and structure. Government/Industry standards can also open

a shade to include other stakeholders. See Enterprise Environmental Factors to know more about what they are and sample lists to know which ones apply to this process.

5. OPAs

There may be a couple of Organizational Process Assets that would help in this process. Wouldn’t it be helpful indeed to obtain a stakeholder register from previous projects of similar nature? Learned lessons, historical information and stakeholder register templates can all be beneficial.

TOOLS AND TECHNIQUES

1. Expert Judgment

Expert judgment plays a significant role in the identification of stakeholders. Because these persons are familiar with the project environment, they can ensure a comprehensive identification and listing of all possible stakeholders. Already identified stakeholders can also be interviewed to include all potential stakeholders.

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2. Stakeholder Analysis

Listing potential stakeholders is not all there is to it. Stakeholders tend to have varying and conflicting expectations on a project. The question is, whose interest should be taken into account? By what criterion will we do this? We can only be helped by analyzing our identified stakeholders to obtain further information regarding their importance, level of interests, expectations, influence and impact and relate them to the purpose of the project. Classifying stakeholders by a combination of these parameters will tell us how stakeholder groups are likely to react to various situations. An appropriate strategy can then be developed to manage their varying expectations while enhancing positive support and mitigating negative impact.

A number of models classify stakeholders on parameters such as power, interests, influence and importance. We shall take a look at two of them.

Aubrey L. Mendelow’s Power/Interest Grid

This model classifies stakeholders based on their power and level of interests regarding the project’s outcome. Procedure: This stakeholder, what degree of impact (power) does he have on the project? What is his level of interests in achieving project success?

High

POWER

Low INTEREST High

Keep satisfied Manage closely

Monitor Keep Informed (Minimum Effort)

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We can infer from above diagram stakeholders with high power – low interest, high power – high interest, low power – high interest, and low power – low interest.

Let’s spice up our understanding with a more resounding interpretation by going clockwise on the diagram:

i. High power – low interest: These are stakeholders who exert power on the project but have little care if the project will be successful or not. For example: on a building project, you may need to obtain a building permit from a metropolitan assembly before you start out. This office exerts so much power that they can halt your project if you do not satisfy their requirements. But whether or not your project will be successful is none of their business. The same can be said for standardization offices, approval boards, etc.

The strategy is: Keep them satisfied. Give them what they want.

ii. High power – high interest: This category of stakeholders exerts power on the project, they can proactively impact the project directly, and they also have great interest that the project succeeds. A project sponsor for instance is a high power stakeholder who will definitely want the project to succeed.

The strategy is: Manage them closely.

iii. Low power – high interest: This group may not have so much power to determine the way things go on a project, but they surely have so much interest the project succeeds. On most projects, project team members may not wield power, but they are mostly inclined to expect things go well on a project.

The strategy is: Keep them informed.

iv. Low power – low interest: This category of stakeholders have both power and interest on the project running low. You can identify such stakeholders based on the project you are working on. Milano Co. Ltd. in coming out with powdered milk in sachet packs may have the general market as a stakeholder. These customers wield little power to influence the outcome of the project, and they may likewise care less

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if the project comes out successfully or not. After all, there are substitutes of the product on the market they can always obtain.

Mitchel’s Salience Model

The salience model identifies three (3) types of stakeholders:

Power – Stakeholders wielding the ability to impose their will. Legitimacy – Stakeholders legitimately connected to the project. Urgency – Stakeholders whose demands call for immediate attention. The model points out that other stakeholders would share features of two and even all three features which can characteristically be represented on a Venn diagram. Knowing the attitudes they each elicit will help you to plan how to respond to them.

Dangerous Stakeholders

1. POWER

2. LEGITIMACY

3. URGENCY

1 1.2

3

2

1.3

2.3

1.2.3

Dormant Stakeholders

Dominant Stakeholders

Definitive Stakeholders

Demanding Stakeholders

Discretionary Stakeholders

Dependent Stakeholders

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Before we begin interpreting the salience model, let’s go back to the previous paragraph to re-peruse the meaning of each of the three distinct elements: POWER, LEGITIMACY, URGENCY. Try to figure out how the various combinations may mean by interlacing their meanings. 1. Dormant Stakeholders [Power only]: These stakeholders have power [ability to impose their will] but do not have legitimacy [not legitimately connected to the project] and urgency [do not have any demands that will call for immediate attention]. These stakeholders may have the power to affect your project, but they will usually not do that because they are remote to the project. They are dormant stakeholders.

2. Discretionary Stakeholders [Legitimacy only]: These stakeholders are only legitimately connected to the project. They have neither power nor any urgent demands that will call for attention.

3. Demanding Stakeholders [Urgency only]: These stakeholders will usually have demands that you will have to attend to, but they do not have any power, nor are they legitimately connected to the project.

1.2 Dominant Stakeholders [Power & Legitimacy]: These stakeholders have power and legitimacy but do not have any demands that will call for your immediate attention.

1.3 Dangerous Stakeholders [Power & Urgency]: These stakeholders have power as well as urgent demands you have to attend to although they are not legitimately connected to the project. If you do not attend to them, their power can make them dangerous on the project.

2.3 Dependent Stakeholders [Legitimacy & Urgency]: These stakeholders are legitimately connected and have demands that must be met but they have no power. This makes them dependent stakeholders.

1.2.3 Definitive Stakeholders [Power, Legitimacy & Urgency]: These stakeholders have elements of all three types. They are known as definitive stakeholders.

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OUTPUT

1. Stakeholder Register

We set out to “Identify stakeholders.” Now we have a list of them in a Stakeholder Register. The register may include such items as:

• Identification Information – Name of stakeholder, location, organizational position, role on project, and contact information. • Assessment Information – What are the expectations and potential influence of each of the identified stakeholders? Which part or phase on the project is of interest to this stakeholder? • Stakeholder Classification – Grouping stakeholders using suitable criteria like: internal/external, supporter/neutral/resistor. 2. Stakeholder Management Strategy – This is the approach we are going to use to manage each stakeholder to increase their support and minimize negative impacts. This strategy can be developed in a matrix under headings such as: Level of Interests, Impact, Strategies to increase support & minimize negative impacts.