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16 October 2005

Stakeholder Management and 'Different Approaches'

In a presentation about Melbourne Council’s park and organ redevelopment projects the key message was about stakeholder engagement and management, which was ironic because when questioned it appeared that the council’s policy was one of manage the stakeholders by keeping them out of the way of the project and the ‘real work.’

This was fascinating for me as all the stakeholder related literature and articles, and all the previous discussions and experiences I have had all say the same thing:

It's critically important to listen to the stakeholders.

I investigated this issue further with people who have worked on several state and federal government projects and the message consistently came back: That is indeed the way the government works because the stakeholders in politics are managed differently. In politics the stakeholders are apparently more narrowly, and pragmatically, defined as groups that can influence election results, rather than simply having an interest in the project and it’s outcomes.

Fair enough. Not all projects are the same and you need to do a proper analysis on who our stakeholders are and why. This seems to have been done. In most projects though, stakeholders range a bit wider.

Stakeholders are usually anyone who has an interest in the project and can exept influence on its performce and success. Some definitions have excluded project team members, suppliers or customers, but as the roles and relationships between projects, organisations and the communities become more complex it becomes increasingly difficult to exclude anyone from being a stakeholder once they express a stake in a project’s existence or outcomes.

Knowing who your stakeholders are is very important as it enables you to go to them and address their needs, wants and any other concerns they have (eg constraints, guidelines etc.)There are many studies and articles that show a close relationship between stakeholder management and project success. Much of what projects do is implement change, and usually it is people that have to change – the stakeholders. So knowing who they are is an obvious starting point.

The next stage is to ensure they have the opportunity to participate in decisions about their future, a technique that will empower them to adapt to the change. Other change management techniques are also required for effective people change management, but that’s another topic.

The biggest weakness in stakeholder management that I can think of is not addressing stakeholder needs and wants. Kano’s quality framework (needs, linear improvements and excitement factors) suggest that if you are not talking to stakeholders you can’t know what their excitement factors are, and so your results will only be perceived as sufficient rather than excellent. (We all love Tom Peters! and want to be excellent!)

A challenge in effective stakeholder management is knowing all the stakeholders. A CEO of an American corporation (I can’t remember which) Suggests that you simply ask everyone who else should be included on the list. This is a system that seems a simple and practical way to identify all your stakeholders in almost all circumstances. Wrapping that up with a formal document listing can assist this.

It can be easy to think that once your stakeholder list is done the stakeholders are all identified, however as the project progresses more stakeholders can come into existence either through knowledge about the project travelling, or the areas the project gets involved in changing. I worked on a project a few years ago where we decided to outsource what we originally planned to build ourselves. The local procurement office then became a stakeholder, where for the months prior they had not been.