2-2 Managing Stakeholders

Managing projects is about managing stakeholder expectations. Thus, it is important is a  project leader or manager to identify and recognize the different stakeholders for your project.   Different stakeholders have different expectations for the project.

A stakeholder is anyone involved in or affected ( either positively or negatively) by the activities of the project and the project outcomes.  Stakeholders can be external and internal to the organization undertaking the project. Stakeholders include  the project sponsor, project manager, project team, functional managers, other project managers, support staff, customers, users, suppliers, opponents of the project, government agencies and sometimes civil society organizations.  We will review briefly the different stakeholders in a typical project environment and discuss why and how they need to be managed.

Stakeholder management involves developing approaches that help increase the support of different stakeholders throughout the project life cycle.  Stakeholder management includes basic information such as the names, level of interest, level of influence on the project and strtaegies for gaining their interest.

  1. Project Sponsors– The project sponsor is typically the “owner” of the project and the one providing the funding for the project. The project sponsor typically comes from executive ranks and his/her role varies depending on the phase of the project. During the initiation phase the sponsor role is expected to be more active,  helping clarify the goals and objectives,  establish priority for the project,  set the funding level. During the execution phase , the sponsor’s role might be more passive, providing assistance to the project manager as needed and providing funds if the project is exceeding the budget. Management strategies should thus include frequency of communication and the nature of the communication.
  2. Champions– these are key allies of the project who defend the project when it comes under attack, are personally interested in the success of the project and might stake their reputations to the project success.
  3. Top Management– while serving as sponsors and/or champions also adjudicate rewards for accomplishments, might make significant changes to budget, scope and schedule.  They have a vested interest in the project but at the same time are responsive to the overall needs of the organization.
  4. Project Manager– individual responsible for the overall execution of the project. Other project managers in the organization are also stakeholders. Your project might be competing for the same set of resources and for top management support with other projects.  Thus haring of critical resources might be needed as well as frequent exchange of information. It is important that you become aware of other projects in your environment.
  5. Functional Managers-Although it is dependent on how the project is organized, functional managers  are typically responsible for assigning  project personnel to the project, might resolve technical dilemmas within pertaining to their area and  might even oversee significant portions of project work.  The cooperation of functional managers might be lacking sometimes.  They are often concerned with maintaining their status within the organization  and minimizing the disruptions that the project may have on their own operations.
  6. Project Team– these individuals work on the project and they should be expected to bring their best effort to the project. It is  important for the project to recognize  what motivates these individuals, what their personal expectations are for joining the project team and how their performance might be recognized by the organization.
  7. Administrative Support– might include individuals in a PMO ,  human resource office, maintenance, IT ( for non IT projects),  purchasing. While these groups provide valuable services, they might impose constraints and requirements that might hinder the smooth running of the project.
  8. Customers- these can internal or external to the firm executing the project. Customers define the scope  and often their overall satisfaction defines the project success. As a project manager, you need to be responsive to the changing needs, requirements and expectations of the customer.
  9. Government Agencies– Almost of projects have some interaction or dependency with government agencies ( local, state & federal).  These agencies place constraints on project work. Here are some examples. Permits might be needed. Construction work has to be built to code. New drugs require a battery of tests.  Safety standards have to be met. Consumer protection laws have to be enforced, etc.
  10. Other organizations–  these include suppliers, public interest groups, consultants, auditors etc. These all might have vested interests and expectations that if not properly managed can result in delays, cost overruns and performance problems. You might be aware that the Denver International Airport suffered some delays because of a portion of the runway was supposedly going to be constructed over ancestral burial grounds of the native Indians.