Have you ever had a project derail at the last minute, or discovered that a project’s return on investment did not meet projections? These types of issues happen in the final stages of a project, often as a result of incorrect or incomplete stakeholder identification. Conversely, performing due diligence at the beginning of a project to identify stakeholders, (and updating your stakeholder register throughout the project), can minimize the risks of incorrect scope, excessive change orders, and user resistance. Identify stakeholders early to increase your chances of delivering a better result.
What Is a Stakeholder?
In some projects, the term “stakeholder” only describes those individuals with visible and formalized responsibilities on the core project team. The fifth edition of the Project Management Institute’s (PMI) Project Management Body of Knowledge (PMBOK) more accurately defines it as “an individual, group, or organization who may affect, be affected by or perceive itself to be affected by a decision, activity, or outcome of a project” (italics added for emphasis).
Commonly Overlooked Stakeholders
Stakeholders often overlooked include those not involved in the core project team, but who nonetheless play an important role in achieving project success throughout the organization. They include: regulatory agencies, auditors, IT staff outside of the core project team, internal customers, citizens, and staff. Your Project Management Team should plan ahead and identify the appropriate time and approach to include these groups.
Guidelines for Identifying Stakeholders
Identifying stakeholders is an iterative process that incorporates feedback from multiple levels of the project’s governance structure, and identifies stakeholders. When our team works on larger projects, for example an ERP system selection and implementation project, we recommend project leadership identify an Executive Sponsor, who in turn selects an Executive Steering Committee to provide executive-level support to the project by committing resources and weighing in on escalated decisions.
The Executive Sponsor chooses the Project Manager and Project Management Team. Because the Project Management Team works with the Project Manager to accomplish project tasks and reach project decisions, this team assigns staff with appropriate knowledge and other characteristics to be Functional Area Leads (FALs). FALs play an important role in selecting Subject Matter Experts (SMEs) for their respective functional areas, as FALs are typically already leading day-to-day operations for the area they will represent. These leads often have a more detailed knowledge of SME resource availability than those in the project’s executive roles, and can identify the extent of each SME’s areas of strength. Engaging FALs in this exercise can enhance buy-in and ownership of the project, strengthen the quality of the project team, and address nuances where the project structure and organization’s structure do not necessarily align.
We recommend you create a stakeholder register to conduct a thorough inventory of the stakeholder groups involved in (or impacted by) the project’s work. Conducting this exercise identifies relevant characteristics (role in the organization, on the project, supervisory, and communication responsibilities) that can help the Project Management Team make decisions related to issue management activities, risk mitigation, communications strategies, and change management planning. Your Executive Sponsor and Project Management Team should create this stakeholder register early, and update it frequently, as stakeholders often change during a project. Taking multiple stakeholder inventories throughout the project helps set the project up for greater success, less user resistance, and better-informed decision-making.
Do you have questions about our guidelines for identifying stakeholders? Unsure about the best approach for communicating with stakeholders once identified? Contact us and we can help you get started.