Stakeholder Engagement Strategies - Part 02

There are three main components of stakeholder management:

• Stakeholder identification

• Stakeholder analysis

• Stakeholder engagement

Firstly, we identify the stakeholder, and then we analyse them. Lastly, we move towards engaging them. None of the above two steps will add any value until we start to engage the stakeholders.

Building Relationships

Having a list of who your stakeholders are, how important and how interested they are offers no benefits from until we start to engage with the stakeholders. That is why stakeholder engagement is the most important step because it adds value to our project. By engaging, we are going to communicate with the stakeholders and build relationships with them.

Typically, organisations produce lists of stakeholders, have a stakeholder register, and produce a stakeholder map. They identify which stakeholders have high power and a high interest, but then they don’t do anything about it.

We know who, and we know why they are important or interested. Now, we have to do something about it – we have to engage and build relationships with our stakeholders

What we should do is create a stakeholder engagement plan. This is a detailed strategy to effectively engage with the stakeholders. As part of this, we will want the project stakeholders to productively engage in the project planning and execution phases as appropriate. It will include how they see our project from their perspective, and some metrics or key performance indicators to show that we are actually doing these stakeholder engagement activities. The plan will suit the needs of our project, formal or informal, and in as much detail as required.

This engagement plan can be another column in our stakeholder register. In our stakeholder register, we already have a list of stakeholders and their contact information and their interest. What we are adding now is how we are going to deal with them. How we are going to engage with them, how we are going to build those relationships. There might be phases of the projects where we have to ignore some stakeholders because they are not involved, and then other phases where they are deeply involved.

Purpose of the Stakeholder Engagement Plan

The purpose of the engagement plan is to make sure that all of the stakeholders are engaged with the programme of work that we are doing. We are making sure that the organisation is achieving its strategic aim, whatever the scope was for this project that we are delivering. We are doing whatever was defined in the project charter. Whatever was written in the business case, we are going to achieve that.

The primary aim of a project manager is to deliver the project. However, the business needs to get some ongoing benefit from that project. The business is only going to do that if it continues to engage with stakeholders.

It could be that the project manager’s job is now finished, and they have delivered the project. However, the overall business benefit might not happen for a year or two. This is when the savings that we make on a daily, weekly, or monthly basis suddenly mount up to be more than the cost of doing this piece of work in the first place.

The project manager might have moved on. We have got to make sure that the stakeholders are still engaged. A project can very often deliver a capability, and what the business wants is ongoing benefits.

As a project manager, we have to deliver our project, but ideally also deliver ongoing benefits for the organisation. That might mean continually engaging with the stakeholders, after the end of the project. Stakeholders might be for the project, or against the project, our main concern is meeting the needs and desires of those stakeholders who are the positive stakeholders who want the project to happen.

We need to maintain a balance between stakeholders who perhaps are not keen for the project to happen. We have to make sure those stakeholders stay passively against our project. That is why we want an ongoing strategy to keep those stakeholders engaged. If we have matched their interest to the benefits, we can help provide that engagement. So, if the computer system is going to save some stakeholders time in their work, that will be a key performance indicator for us to measure the engagement and that is what we want to make sure is happening.

Who will sign the Stakeholder Engagement Plan?

The stakeholder engagement plan needs to be signed off by the project manager, and perhaps by the project team. Certainly, by the project sponsor or project champion, if you have them listed as key stakeholders. If your project is for a single customer, then probably also the customers who want this project to be delivered.

Further Reading

Relationships with C-Suite stakeholders are extremely beneficial and can deeply and intensely influence the results of projects and activities. When dealing with C-Suite stakeholders, project managers should be equipped with adequate tools and be aware of how to engage them. The paper C-suite stakeholders: Lessons learned to build beneficial relationships tries to shape the figure of the C-Suite stakeholder and includes some real situations the author was involved in and some interviews with these C-Suite executives.

In this section, we will try to get our stakeholders to be more supportive and actively involved in our projects. If they are unaware, resistant, or have a neutral status, it will be beneficial for us to try to have them be supportive or leading.

This could be another way of analysing our stakeholders – another column on the stakeholder registers where we enter that engagement level. We need to do it from the start of the project, we need to start building a relationship with the stakeholders, which will help us with accurate classification.

Example of Stakeholder Engagement

Here is an example of stakeholder engagement profiles. We are trying to move our first stakeholder to be more receptive to the project, and we are trying to move our second stakeholder to be more supportive of the project.

Receptiveness might vary from:

• Completely Uninterested – Refuses to accept reports

• Not Interested – On mail list but unlikely to read reports

• Neutral – Receives Reports

• Medium – Indirect personal access

• High – Direct personal contacts

Supportive might vary from:

• Active Opposition

• Passive Opposition

• Neutral

• Passive Support

• Active Support

Using a 5×5 matrix we can calculate an Engagement Index for the whole stakeholder community and track these changes through the life of the project.

To calculate the index for each stakeholder, use the formulae ((SQRT(R *S)) – 1) *25. Please note:

• 100 shows all stakeholders are fully supportive and receptive (R = 5 & S = 5)

• 50 indicates the stakeholder community is on average neutral (R = 3 & S = 3)

• 0 shows no stakeholders are supportive or receptive (R = 1 & S = 1).

If the trends are positive, the stakeholder engagement strategy can be shown to be effective. However, if the trends are negative, the engagement strategy should be reviewed.

Remember that the stakeholders could change their views throughout the project. We can start the project with a current engagement level and desired engagement level. This should be reviewed throughout the project, as stakeholder views might change at any point through the project.

Benefits of Stakeholder Engagement

It is observed that engaging the stakeholders always benefits everyone involved in a project. Effective stakeholder engagement adds value to the organisation because the project is being done to meet the organisation’s strategic objectives. When stakeholder engagement is properly done, there is a better chance of project success and of delivering the business benefit that we want.

Stakeholder engagement is a value and benefit to the stakeholders themselves. It will make them feel listened to, informed, involved, and it is a benefit to the project. We know who the stakeholders are, we know who we are talking to, we get early warning about the problems that are coming up because we have a relationship with the stakeholders.

Finally, stakeholder engagement adds value and benefits to the project team. This is because the project should go more smoothly and more successfully. There will be a better sense of achievement at the end of the project.

Steps for Effective Stakeholder Engagement

• Build relationships: Rather than follow processes. Having identified the stakeholders, having collected lots of information about them. Start to build relationships with them.
  

• Set their expectations: You may need to be assertive, and you may need to negotiate. You may need to say “no” to some of their wants and desires.

• Develop their stakeholder profile: Complete a stakeholder engagement plan, and stay in touch with the project stakeholder.

Take a look at the Materials section of this topic to see a few templates and spreadsheets you can use to plan an engagement strategy for your project stakeholders.

Over to you

We have established that effective stakeholder engagement adds value and benefits the successful outcome of a project. The paper Engaging Stakeholders for Project Success offer further views on how to approach the task of engaging stakeholders.

Considering everything that you have learned so far, share in the comments section below what key learnings and techniques you will start applying to manage stakeholder expectations and engage them with the project?

The Association for Project Management (APM) has looked very deeply at stakeholder engagement. Ten years ago, some members were not happy with the term “stakeholder management”. They set up a focus group and a specific interest group on the subject. They defined the 10 key principles of stakeholder engagement.

10 Key Principles of Stakeholder Engagement

• Communicate. Gather information on your stakeholders.

• Consult, early and often. Before it’s too late in the PM Process.

• Remember, they’re only human. View things from their perspective.

• Plan it! Identify, assess, and plan engagement.

• Relationships are key. Developing relationships results in increased trust. And where there is trust, people work together more easily and effectively. Investing effort in identifying and building stakeholder relationships can increase confidence across the project environment, minimise uncertainty, and speed problem-solving and decision-making.

• Simple, but not easy. Be proactive, and anticipate issues early.

• Just part of managing risk. Stakeholders are influential resources and should be treated as potential sources of risk and opportunity within the project.

• Compromise. The initial step is to establish the most acceptable baseline across a set of stakeholders’ diverging expectations and priorities. Assess the relative importance of all stakeholders to establish a weighted hierarchy against the project requirements and agreed upon by the Project Sponsor.

• Understand what success is. Establish what your stakeholder community perceives success to be.

• Take responsibility. Everybody in the project team needs to understand their role, engage and build relationships with stakeholders.

  
  

Further Reading

The APM has provided a great resource to supplement the above stakeholder engagement principles. 10 key principles of stakeholder engagement to explore each of the principles further.

In order to maintain good communication with our stakeholders, we need a communication plan to engage with the stakeholders. The plan should clearly show:

• What it is that we need to communicate

• Why are we communicating this information

• Who’s it going to do the communication, and who is the communication towards

• When and how often we need to communicate

• How are we going to make that communication

• Where are we going to do it

We need to start communicating before we know that we have to. There is a popular phrase: “it’s who you know, not what you know”. Communication with stakeholders is about how we can keep the stakeholders involved and participating in the project. Building relationships means five things:

1. Be open and honest, and do what you promised.

2. Make sure that there are no surprises.

3. Be assertive.

4. Treat people as people.

5. Show respect.

In this section we will be looking at the important project management tools. The first tool is a responsibility assignment matrix, or RACI chart is simply a list of the tasks that we need to do on the project. Another tool is The Risk Log describes the risk, and then estimates the risk impact and the risk probability. When a risk has happened, it becomes an issue. We then probably need to move the risk to an Issue Log. When any changes come along, we need to tell people about them. Any change that comes along, needs to be logged in changes Log.

It is important to set expectations with the project stakeholders. We need to meet with them, and clearly tell them what we are going to do. Never make assumptions. By being clear with our stakeholders about what we are going to do, they cannot make assumptions either. We should use some good open questions to build relationships and identify stakeholders.

An Ongoing Process

Previously, we have learned about stakeholder communication and engagement. Now we need to keep engaging continuously with the stakeholders. Stakeholder engagement is an ongoing process.

On any project things are constantly changing. Below is a list of a few:

• The scope could be changed

• The project team members can be changed

• Risks become issues,

• Issues become project changes,

• Changes affect the project scope

• Eventually, different stakeholders could become involved

• A supplier changes and we have got a new stakeholder.

As such, we need to keep reviewing our stakeholders – constantly re-identifying them and keeping them engaged.

Managing and Communicating Change

In Predictive project management, we are trying to keep things planned for the next three months. Things might be relatively stable.

In Agile or Adaptive project management, change is welcome and expected. Identifying the changing stakeholders is an ongoing process.

Our project is a vision that we are trying to implement. To make our project a reality we have to plan it well. That means having a clear scope, a good schedule, an accurate budget, and considering risks. Talking to the project stakeholders is all part of this project planning.

However, to deal with all the changes that could happen in a project, remember to consult with the stakeholders, review the project scope, budget, risks, and schedule. Monitor what is happening on the project, and keep communicating with the project stakeholders.

One way to engage our stakeholders is to engage them with open questions – this will allow them to elicit their feelings on the project. Questionnaires and surveys can note how engaged they are. These can provide Key Performance Indicators (KPI’s) regarding stakeholder engagement on our project.

Communication channels can break, so use at least two channels with each stakeholder – this will ensure communication gets through to them.

When we maintain our communication with the project stakeholders, we are able to identify warning signs that could tell us the stakeholders’ position is changing. These might include stakeholders who miss meetings, delay decisions, and are becoming vague.

Relationships are the key to ensuring this continuous involvement with stakeholders. Social engagements with the wider project team help to build those relationships. “Thank-You’s” go a long way to being respected within these relationships.

Good projects are closed with a project review. Part of that project review should be considering how we identify, assess, communicate, and engage with the project stakeholders.

In this topic, we will discuss the methods to deal with difficult stakeholders.

It is important to note the top warning signs that indicate the stakeholder position is could be changing. They are the following:

• Missing meetings

• Delaying decisions

• Being vague

• Communication stops or reduces

• Becoming critical, defensive, or aggressive

These are the “red flag” signals that things have gone or are about to go wrong.

How to Deal with Difficult Stakeholders

When things go wrong, it is time to listen to the stakeholders that are getting difficult to manage. Again, ask questions:

• How is the project going from our personal viewpoint?

• What can we do to improve communication? (or engagement, or participation?)

• Have our requirements for this project changed?

We may need to be assertive with our stakeholders, but we need to make sure that we listen to them and understand their changed motivation. Use the questions to establish the continuing viability of the project for the stakeholder.

Try to have an understanding about the following points:

• Is the problem with the project or with the stakeholder engagement process?

• Is this a sign that engagement with all our stakeholders needs to be reviewed?

• What are the potential escalation routes for dealing with a difficult stakeholder?

• Can our senior managers help?

• If you cannot agree, then can you negotiate?

Compromise might be a lost win, but in some cases it might be the way forward.

Explore the topic further

Dealing with difficult stakeholder is indeed a tough task, but we can manage these type of relationships with assertiveness. On the Stakeholder challenge: Dealing with difficult stakeholders webinar, Dr Christine Unterhitzenberger shares her research project published earlier in 2018, that focuses on the psycho-social aspects of project management and specifically on how project managers cope with difficult stakeholders. You can download the research paper from the Materials section at the top.

Considering everything that you have learned and your own experiences to date, please share in the comments below what are (or will be) your go-to strategies to deal with difficult stakeholders.

Explore All Options First

Compromise can be a loss-win. We need to make sure that we have explored all options before agreeing to compromise. Ideally, we should find a solution that becomes a win-win.

As with negotiation, we need to be prepared by identifying what we could potentially be we happy to agree with. We need to know our most favoured and least favoured position. This is of course even more complicated if there are several stakeholders with differing views, and all are affected by the decision we are trying to resolve.

Find a Common Ground

The stakeholder map (Affinity diagram or rich picture) is useful for trying to view issues from the others perspective. Assess the relative importance of all stakeholders. This helps establish a weighted hierarchy against the project requirements. Get this agreed by the project Sponsor.

This weighted hierarchy might help you decide which stakeholder you give more or less ground to in the negotiation, or discussions on compromise.

Another Perspective

The stakeholder map (affinity diagram or rich picture) is useful for trying to view issues from the others’ perspectives.

Assess the relative importance of all stakeholders – it will help you establish a weighted hierarchy against the project requirements. Get this agreed by the Project Sponsor.

This weighted hierarchy might help you decide which stakeholder you give more or less ground to in the negotiation, or discussions on compromise.

What are the benefits?

Ongoing relationships, engagement, and listening to your stakeholders will:

• Give stakeholders confidence that their concerns are being listened to.

• Allow a workable solution to be applied to what may seem a difficult problem.

• Help build a relationship across your stakeholder community.

• Establish a more transparent and open project culture.

Further Reading

The article Fork in the Road by Kate Rockwood gives some examples of when project managers must learn to push ahead, to push back, and to compromise.

Capability Maturity Model

A standard Capability Maturity Model (CMM) can be applied to many things. Typically, the CMM has 5 levels:

• Ad-Hoc

• Procedural – Repeatable

• Relational or Integrated

• Comprehensive

• Predictive

  
  

Level 1: Ad-hoc

Ask yourself how well your organisation deals with the project stakeholders. If you are at Level 1 then you will find that everybody is doing their own thing.

Level 2: Procedural - Repeatable

We need to set up some processes and move up to level 2. This will introduce some consistency and repeatability into our stakeholder engagement. This may lead to just an internal focus, whereas many stakeholders are external.

Level 3: Relational or Integrated

Level 3 requires more integration. At this level, we want an organisational overview of how stakeholders are managed, along with an external look at stakeholders, competitors, partners suppliers, and industry practice.

Level 4: Comprehensive

Level 4 of stakeholder relationship management maturity is more comprehensive. The organisation now recognises individuals’ awareness, ability, and competences in stakeholder engagement.

Training is provided in the skills required. Stakeholder engagement is now integrated into the business – it cannot be ignored or forgotten.

Level 5: Predictive

Level 5 is the optimised, and continually improving proactive examination of stakeholder engagement processes. It will look at lessons learned regarding stakeholder identification, assessment, communication, and engagement.

Keeping stakeholders involved with our project ensures that the project will deliver the required business benefits for all.

Keep a lookout for new stakeholders, never stop communicating, and engaging with the stakeholders. A good relationship with our project stakeholders will help identify issues early that can be dealt with to the mutual benefit of all parties.

Further Reading

In this section, we have looked at the capability maturity model levels. The article Measuring the success of project management and the capability maturity model using the parking lot metric is an example of using the model in practice to successfully complete software development projects on time and within budget.

Increase the Chance of Project Success

In this section, we will reflect on why is stakeholder engagement important. We must remember that stakeholder engagement is vital, rather than important.

Lots of initiatives and projects fail to deliver what is required. The business does not benefit from this wasted effort. But if we do more stakeholder engagement, then there is more chance of project success.

Common Project Failures

Stakeholder engagement and good relationships with stakeholders help solve common project failures:

• Disparity of objectives

• Conflicting objectives

• Lack of communication

• Misunderstood project risks

• Poor team working

• Scope creep

• Lack of resources

These all relate back to the project stakeholders in some way or other. Stakeholder engagement is important, and it takes time and effort.

Over to you

In order to maintain good relationships with our stakeholders, we need to constantly engage them. Considering all that you have learned on this course, share in the comments section below which are the key principles, tools, and techniques you will start implementing in your daily practice to perform stakeholder engagement regularly.

What Prevents Good Stakeholder Engagement?

In this topic, we will be focusing on problems that can negatively impact effective stakeholder engagement. So, what prevents good Stakeholder Engagement?

Do we really want to reach out to negative people and build relationships with them? Well, we should! It might not be our favourite job, but it is important.

We have discovered during the course that there are a lot of stakeholders. Assigning a team member to stakeholder engagement might be a way forward.

Make it clear that team members are responsible for communicating, engaging, and building relationships with particular stakeholders.

However, we need to consider that people change jobs. Maybe one person’s job is split, and we now need to speak to two stakeholders.

Lack of Information

One of the main issues with projects is a lack of information. Projects do not get approved until there is enough information for the business case, or from a feasibility study.

We run projects to make an improvement, to get business benefits. All of a sudden a new project comes along, and people are taken by surprise because only a few people knew about it.

Projects are delivered quickly, because the quicker we do them, the more benefit we get. This means that often there is little advanced warning, limited meetings, and a lack of full information. In these situations, we don’t know who we should be engaging with, and decisions have already been made before we engage with them.

Taking time is not an option either. Speed is important in projects, the sooner we deliver the project, the quicker we get the business benefit. That might be from a new product, a cost saving, a new service, or reduced waste.

The Feasibility Study

One of the key issues is that many projects do not actually get out of the feasibility stage. There is no point in getting everybody involved at that early stage if the ultimate answer is “no, we’re not going to continue with this project”. Success means getting the right balance between involving too many stakeholders too early, and too few stakeholders too late.

There could be emotive reasons for not getting stakeholders involved. A project to reduce headcount is emotive, or to move the offices to a location 50 miles away. We do not want to talk too much about it until we know for sure that the project will be approved.

The feasibility study is going to happen first. If that concludes that there is a business benefit, then people are taken by surprise when it is finally announced. Inherently with projects, because of their speed, and because of their sensitivity, information is often lacking at the start.

Getting the balance right between involving too many stakeholders too early, and being aware of the emotions and sensitivity of the project, is crucial to achieve success.

These are the reasons that people can resist new project ideas, and it is down to being surprised and not having enough information.

In this topic, we will be looking at some guidelines for engaging and communicating with your stakeholders.

1. Recognise your Stakeholders

Recognise who the stakeholders are. It is important to identify your stakeholders early – we spent some time on this topic earlier in the course.

2. Classify your Stakeholders

Use a model to classify the stakeholders into groups. The stakeholders actively “for” the project and those actively “against” the project will be of key interest. We learned earlier in the course how to create a detailed stakeholder register with lots of information about the stakeholders. If you use a spreadsheet, you can reorganise in any way you need.

3. Shape your Strategy

Use the stakeholders to shape your strategy. If we have some powerful stakeholders, they might want to move faster than we are planning to move. So, use that momentum to build relationships.

4. Build Relationships

We need to get close to our stakeholders, and build trust. Keep working with our stakeholders. If it is working well, do more of it. If it’s not working, do something else.

Let’s recap what we learned on the course to achieve success:

• Identify the stakeholders

• Analyse the stakeholders, their interests, and influence

• Create a stakeholder map or use the Salience Model

• Write actions to manage, communicate, and engage with the stakeholders

Benefits Management Overview

A project delivers a capability to do something. The organisation needs to make sure that capability is turned into ongoing business benefits.

Sometimes there is a benefits manager who works alongside a project manager. When the project is delivered, it could be that the project manager leaves for the next project. However, the benefits manager stays to make sure that all of the benefit is maintained through the life of the system, or service, or the product.

The benefits manager remains with the main stakeholders – the customers, users, and management – to ensure ongoing delivery of the project benefits.

Benefits Mapping

Benefits mapping looks at the many benefits that the project delivers, and then maps those benefits back to the stakeholders, and what they want. This can become a visual representation, linking our objectives of the project to the benefits that we deliver to the stakeholder.

For example:
We might be launching a new product. One of the stakeholders could be our sales people. They will benefit by having a better product to sell. That is the benefit that they want to see delivered. The finance department will be interested in the project because it is more profitable than the last one. The increased profit benefit will map back to them as stakeholders. Benefits mapping helps us identify the key stakeholders, and clarify the key project objectives.

It is suggested that we have a stakeholder engagement plan. This is the strategy for our stakeholder communications. Prepare the plan, evaluate it and keep it going.

We should update our stakeholder strategy, our engagement plan, our communication plan, probably every three months or so. On longer projects, maybe every six months a full review is required. We need to maintain our stakeholder communication plan and enhance it on a regular basis – identify the changes, engage with the new stakeholders and build relationships with them.

Stakeholder engagement is the responsibility of the project manager by default. Because of the work involved, we should use the project team to engage with the project stakeholders. It is also suggested that the project sponsor, champion, senior manager, or executive can act as ambassadors. If we are dealing with an important stakeholder, we need to get our CEO to go and visit them and smooth some pathways for us. This might open some doors to partnerships and participation. Maintain networks and alliances, be collaborative, rather than combative.

Let’s say we worked with a stakeholder last year. The project was a success. How are we going to maintain that relationship? This takes time and effort.

We set up these relationships – these networks or alliance – and of course people can move on or things can change. For example, companies get taken over, move in different strategic directions, and it all could become a wasted effort. Neverthless, we need to keep maintaining the relationships.

Success is about having a communication and engagement plan that is regularly reviewed. Success is about maintaining networks, alliances, and partnerships rather than letting them wither. Success is building relationships with our stakeholders.