by Athrym Ong

Introduction

In the year 2013, the new release of PMBOK® version 5 marks a significant change in the history of project management. One of the major updates to the standards is the segregation of project stakeholder management from the project communication management as an individual knowledge area.  Apparently, the segregation shows that managing project stakeholders has becomes one of the critical accountabilities to a project manager in securing the accomplishment of a project or program.

According to the PMBOK® version 5, a stakeholder is 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. Throughout a project life cycle, a project manager may need to interact with different group of stakeholders, who will have different interest and impact to a project. However, there is always a challenge to a project manager to address the needs of different stakeholders which could be conflicted among each other.

For instance, clients of an infrastructure project in a hill wood area will expect to gain highest economic benefit from the project accomplishment. However, the affected business groups and government sector may impose constraints and expect relative economic payback from the project accomplishment. In this context, the extent of works that a project group may put in to balance the interest and optimize the economic impacts to both groups (i.e. equilibrium point) is always arguable. The oversight of the interest and influenc
e power of different groups of stakeholder may results a dilemma to a project.

Therefore, understand who are the project stakeholders and their stakes in a project are essential before an effective communication plan could be established.

Step-By-Step Approach

The first step of project stakeholder management is to identify the right stakeholders, understand their interest, involvement, interdependencies, influence and impact towards the project accomplishment. This is documented in the stakeholder analysis.

  1. Stakeholders Identification

It is fundamental to record all the stakeholders to a project, including internal and external. At this point, a project group may adopt v
arious techniques, including brainstorm, past projects reference, interview, expert judgment, Delphi method and so forth to list down or map out the possible stakeholders in a stakeholder map.

  1. Stakeholders Segmentation

Why XYZ is identified as a project stakeholder? Through the identification process, a project group should be able to identify a stakeholder’s needs, interest, expectation, power, impact and relationship to the project as well as other stakeholders. At this point, the project group may adopt the techniques of Ishikawa or Fishbone Diagram to drill-down the interdependency between a project and stakeholders. Throughout the branching process, the project group should be able to acknowledge the common relationships among stakeholders and group them into different segments to facilitate the subsequent engagement and communication plans with stakeholders.

  1. Stakeholder Matrix

At this point, perhaps the project group has gained an insight on who are the key stakeholders and the likelihood of their response when a project is executed. Referring to the PMBOK® version 5, a project group may position an classify the different key stakeholders into the below matrixes:

  • Power/interest grid, grouping the stakeholders based on their level of authority (“power”) and their level or concern (“interest”) regarding the project outcomes;
  • Power/influence grid, grouping the stakeholders based on their level of authority (“power”) and their active involvement (“influence”) in the project;
  • Influence/impact grid, grouping the stakeholders based on their active involvement (“influence”) in the project and their ability to effect changes to the project’s planning or execution (“impact”); and
  • Salience model, describing classes of stakeholders based on their power (ability to impose their will), urgency (need for immediate attention), and legitimacy (their involvement is appropriate).

With the resources constraint (i.e time, cost and scope), a project group should focus and address the stakeholders whom with a relativ
e high power, interest influence and impacts in a project. The project group should consider the position of each key stakeholders when develop the management strategies in order to be able to gain and engage their supports effectively as well as to mitigate the potential negative impacts throughout the project life cycle.

Conclusion

It is crucial to a project manager to engage right stakeholders at the beginning of a project. Failure to identify the right stakeholders could leads to a waste of resources and criticism from the core entity. Consequently, the project may not achieve its expected value at the end.

Sources:

1. Chapter 13: Project Stakeholder Management, A Guide To The Project Management Body of Knowledge, PMBOK® Guide, Fifth Edition, pg. 391 – 398.

2. Stakeholder Management,

http://www.tutorialspoint.com/management_concepts/stakeholder_management.htm

[Accessed 23 March 2014]

3. Stakeholder Management

Planning Stakeholder Communication

http://www.mindtools.com/pages/article/newPPM_08.htm

[Accessed 23 March 2014]

Athrym Ong has been working in the gaming industry for over 10 years, including in Malaysia, Macau and Singapore. During the recent years, she has had a key role in a project team tasked to manage a series of projects related to the set up and organization of the business uAthrym-Ong-2nit, gaming machines, business processes, compliance audits, training and development for multi-national companies.

Athrym graduated with a Master of Business Administration, with a major in Project Management, at the University of Queensland. She is also a qualified trainer and assessor with extensive training experiences. Currently Athrym lives and works in Singapore with the intention to further her career in Thailand.