Project Stakeholder Management

This is the second in a series of six articles to discuss Best Practices in Project Stakeholder Management, using the I-C-E cube model:

1. Identify
2. Classify
3. Expectations
4. Influence
5. Communicate
6. Evaluate

2. PROJECT STAKEHOLDER CLASSIFICATION

The list of project stakeholders can be very large, so we need to partition the list in a way that helps us to manage each stakeholder or group. One strategy is to map out all the stakeholders on your project and partition them according to their:

INFLUENCE (“the ability to control or affect the actions, beliefs and attitudes of other people”) and:
INTEREST (“the state of being responsible, affected, involved, concerned, attentive curious”).

After considering all the classifications, you will be able to plot the stakeholders in a grid similar to the example below:

A further dimension can also be added by considering people’s level of support for your project. Assess their motivation, and fit them in to one of these categories:

• Allies
• Supporters
• Neutral
• Reluctant
• Opponents

This exercise can be done using a flipchart and a few coloured pens, or on a spreadsheet.

This is the first in a series of six articles to discuss Best Practices in Project Stakeholder Management, using the I-C-E cube model:

1. Identify
2. Classify
3. Expectations
4. Influence
5. Communicate
6. Evaluate

1. PROJECT STAKEHOLDER IDENTIFICATION

The first step in developing our Project Stakeholder Management strategy is to identify the stakeholders. These are people or organisations that are actively involved in a project, or whose interests may be positively or negatively affected by execution or completion of the project. Overlooking negative stakeholders can increase the likelihood of failure. Whatever list you produce will need to be re-visited during the project lifecycle as new information becomes available and as the project progresses.

In order to start the identification process you’ll need the following inputs:

• Project Charter
• Procurement documents
• Company information
• Lessons learned from previous projects

The output of this exercise will simply be a listing of stakeholders, with no analysis at this stage.
I suggest an initial identification exercise by the Project Manager, followed by exercises with the project team in the form of brainstorming or other group-facilitation methods.

To get you started, see the list of project stakeholders in the ‘downloads’ section.

We work in a discipline called “Project Management”, which seems to imply that it only takes ‘management’ and processes in order to ensure a positive outcome to our projects. However, it seems that every time I go to the bookstore I see yet another book telling us that Project Managers need to be ‘Leaders’.

Whilst I do believe it is possible to learn some tools and techniques that enable Project Managers to employ leadership skills for team building and project stakeholder interaction, I’m not sure that ‘leadership’ can actually be taught. The books and training courses help us to define what leadership is, and the essential differences between leadership and management, but how do we become leaders?

Here’s a resource to help with the definition of leaders and managers that you can use when asked to define the differences.

I feel that Project Managers must be also be able to lead, motivate and inspire others, coupled with a solid understanding of the processes and mechanics of running projects.

One of the eternal questions about leadership is whether it’s better for leaders to be loved (by using soft-powers based on persuasion and influence) or feared (using coercion and force). I certainly use both hard and soft skills with my kids, so was interested to see a new book that discusses the relationship between power and leadership:

The Powers to Lead, by Joseph S. Nye, Oxford University Press.

The author concludes that a combination of hard and soft power is the best approach to leadership - a combination he calls ’smart power’. Apparently, different sorts of leaders are required in different circumstances, and leaders who succeed in one particular environment might struggle in another.

There are no clear answers to the questions about leadership and management but I’m glad to see that there are now many resources available to help us. Lessons learned for project stakeholder management:

1. Learn both management and leadership skills.
2. Balance the use of soft leadership using persuasion and influence, with the hard skills of coercion and force.
   
3. Be aware that you will need to change your approach based on the circumstances.

This morning I noticed a new feature at my favourite Tanah Merah bus stop: An information panel showing arrival times of buses. The information is intended to “help commuters better manage waiting time and transfers, and make more informed travel decisions”, says the Singapore Land Transport Authority (LTA).

LTA installed the first 30 real-time bus arrival information panels in July 2007, followed by customer surveys. Nine out of ten commuters polled felt that the panels were useful and important, and hoped to see them at more bus stops. Based on this feedback, another 20 panels are now being installed.

For those interested in the technical details, data for the display panels is sent from the bus operator’s system via cellular-phone networks General Packet Radio Service (GPRS). The system uses the bus operator’s Automated Vehicle Management System (AVMS), which tracks all 2,850 SBS Transit buses in 222 services. The AVMS tracks the exact location of a bus on a given route,and monitors problems like bunching and buses which are too fast or early.

Lessons Learned for Project Stakeholder Management:

1. If you are implementing a new service, it is best to perform an initial installation followed by stakeholder surveys. If the service is deemed to be useful, then incorporate any suggested changes and continue the expansion of the service.
2. People like to have information made available. No more standing at a bus-stop with no idea when the next bus will arrive. This could apply to projects that you are running; always give people relevant, timely, useful information about what is happening, to enable them to feel in control of the situation.
3. As usual, execution is everything. The information needs to be accurate to be useful. You will also hear some stakeholders grumbling about your service, as they now have the information to complain (”so the bus will arrive in 35 minutes - I can’t wait that long - why aren’t there enough buses?”). Be prepared to tackle these awkward questions that arise in response to the information you provide.

I’ve found that it’s always best to provide information than attempt hide it. We already knew that some buses were infrequent, so posting the information in public on a big display is actually a step in the right direction.

Good Project managers need the ability to succeed with project stakeholder negotiations, to help with effective decision-making.

A recent article in Psychological Science offers the latest research and some good advice that we can use in our negotiations.

Psychologist Adam Galinsky from the Kellogg School of Management at Northwestern University of Illinois and his colleagues examined two related approaches to understanding one’s opponent in negotiations: perspective-taking and empathy. Perspective-taking is described as the cognitive power to consider issues from somebody else’s viewpoint (also known as ‘re-framing’), whereas empathy is the power to connect emotionally with people.

They conducted a series of experiments to test whether perspective-taking or empathy was the more useful technique, by enlisting the help of MBA students. The researchers first performed personality tests to assess the whether the students were more likely to be capable of perspective-taking, or having the ability to act with empathy.

Next they asked the students to play the part of buyer and seller to reach a deal in the buying and selling of a petrol station (or ‘gas station’). The twist is that the buyer’s maximum price was set below the seller’s reserve price, so the only way to get a deal would be to understand and investigate other options. The creative deal involved understanding that the seller needed the money to finance a sailing trip but would need a job on his return, whilst the buyer needed staff to run the petrol station.

Students who were ranked as ‘perspective-taking’ were more likely to successfully reach a deal. In contrast, higher scores on empathy tended to result in being less successful at reaching a creative deal.

Negotiators give themselves an advantage by thinking about what is motivating the other party, by getting inside their head” Galinsky said. “Perspective-taking gives you insights into how to structure a deal that can benefit both parties. But unfortunately in negotiations, empathising makes you more concerned about making the other party happy, which can sometimes come at your own expense.

This is very interesting, so how do we apply the lessons to project stakeholder negotiations? A useful place to look for tips would be in the field of Neuro Linguistic Programming (NLP), using a technique known as ‘reframing’.

Reframing describes changing the context or representation of a problem. For example if you are lying in bed and hear the bedroom door open, your reaction depends upon the frame of reference; are you expecting the kids to wander in, or could it be a burglar? Is that gunman a ‘terrorist’ or ‘freedom fighter’? Once you understand that everyone might have a different understanding of the same event, then you can take steps to increase your awareness and ability to take a perspective.

So if you want to succeed with project stakeholder negotiations, just don’t get emotionally involved with your opponent as this leads to the worst outcome.