Project success depends largely on the people
involved.  You may get to pick some or all of your project
team, but you won’t get to choose every stakeholder.  As a
project manager, it’s your job to work with the stakeholders
you’ve got and to understand what makes them tick.  This
is essential to ensure maximized engagement and minimized
problems.  The key is found in the stakeholder analysis.  Read on to learn how it works.

Analyzing Stakeholder Role, Interest and Influence

Every project has “stakeholders”, forming the “human element” of
the project management paradigm.  As the name implies, a
project stakeholder  is any individual or entity with a “stake”
in the project at hand (i.e. something to lose, and something to
gain).  This “stake” drives behavior, and behavior drives
results.

If you want your project to succeed, with minimal conflicts, you
need to get every stakeholder fully “engaged” and motivated . 
Engagement and participation instills pride of ownership, leading to
better results, delivered in a more productive manner.  The ability
to “engage” begins with a full understanding of stakeholder identity
and assigned role,
vested interest, accountability, and the power to
influence resulting outcomes. 
In procedural terms, this “understanding” is obtained through the
stakeholder
analysis.

Key Steps to Identify, Analyze and Act

The project stakeholder analysis is performed in four (4) steps as detailed below:

Step 1:  Who are your project stakeholders?

The first step in the stakeholder analysis process is to identify
“the stakeholders” according to their primary project “role”. 
It is important to consider stakeholders from both an organizational
and individual point of view.  Organizational stakeholders include
the “entities” engaged in the project, considering departments, workgroups,
teams, committees and related entities.  Individual stakeholders
are defined by the “people” (and personalities) involved in the project
(the human element).   Stakeholder identification can be greatly
simplified through the use of the following standardized categories:

• Beneficiary Stakeholders:  Group/individual
  receiving a benefit from the project.
• Executing Stakeholders (Management): 
  Group/individual responsible for managing execution.
• Executing Stakeholders (Participants): 
  Group/individual responsible for project execution.
• Oversight (Sponsor):  Group/individual
  responsible for oversight and sponsorship.
• Oversight (Advisor):  Group/individual
  responsible for advising and overseeing project execution.

Step 2:  Who has a vested interest in the outcome?

Once stakeholders have been identified, it’s time to consider the
“interest” each has in the project (again from both a “project” and
“process” point of view).  Interest is defined by impact and accountability:

Interest Determined by Impact:  Every project
has consequences, to be realized in a variety of ways and degrees (operational,
financial and personal).  Projects can change the way work is performed,
lessen responsibility, add responsibility, and the like.  Impact
can be felt in numerous ways, both obvious and subtle.  The more
serious and significant the impact, the more “interest” in the project
(and/or management process).  To streamline this assessment, “interest”
can be rated at three (3) levels:

• Maximum Impact:  The project will have significant impact
  on the group and/or individual.
• Moderate Impact:  The project will have measureable impact
  on the group and/or individual.
• Minimal Impact:  The project will have minor impact on
  the group and/or individual.

Interest Determined by Accountability It goes without
saying that accountability is a great motivator.  Accountability
is defined by the degree to which a stakeholder will be held responsible
for their role in the project, whether for the tasks assigned, decisions
made, support provided, participation, attitude, and overall contributions. 
The more “accountability” the greater the interest.

• Maximum:  The stakeholder has significant accountability
  for the project and/or process.
• Moderate:  The stakeholder has measureable accountability
  for the project and/or process.
• Minimal:  The stakeholder has minimal accountability for
  the project and/or process.

Step 3:  Who has the power to make a difference?

It takes a lot of effort to make a successful project, but it
only takes a small act to undo that effort and take things in the
wrong direction. 
People (and groups) have the power to steer projects to success or divert
the outcome in unwanted ways.  This is the two sided coin known
as “stakeholder influence”.  On the up side, active stakeholder
engagement will certainly have a positive influence on the project and/or
process (and this possibility must be cultivated).  On the down
side, stakeholders also have the capacity for negative influence,
realized in a myriad of ways (i.e. failure to perform, failure to
decide, failure to support, procrastination, withholding information
and the like).  To facilitate the stakeholder analysis, influence “potential”
is largely determined
by the strength of the probable consequences:

• Strong Influence:  The stakeholder has significant capability
  for positive/negative influence.
• Moderate Influence:  The stakeholder has measureable capability
  for positive/negative influence.
• Weak Influence:  The stakeholder has minimal capability
  for positive/negative influence.

Step 4:  Putting it all together to determine stakeholder “engagement”
and management priorities.

The final step in the stakeholder analysis process is to
use resulting data to identify and select “priority” stakeholders as
a focus
for engagement and management strategies.  “Level 1” priorities will
likely encompass those stakeholders with “maximum” impact and accountability
and “strong” influence capability (both positive and/or negative). 
Surrounding project conditions (time, funding, risk and visibility)
will determine the extent to which related engagement strategies
must also
address impact, accountability and influence of lesser significance.

Planning Tip: Don’t forget to examine the
lessons learned from previous projects
as a guideline to determine “priority stakeholders” and to refine
related strategies.

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