Lesson 5: Stakeholder Management

Video

Stakeholder Management

Everybody - leader or not - should understand basic stakeholder management.

If you start a project with no stakeholder engagement, you run the very real risk of working on things that nobody cares about. As a leader, you may also encounter projects that are already in motion but have not clearly considered their own stakeholders. You can use your knowledge of stakeholder management to push for this to be incorporated into the planning process.

A Three-Step Process

1. Identify

List everyone involved in or impacted by the project - project teams, technical teams, executives, customers, partner teams. Don't forget that there may be external stakeholders too, such as vendors, regulators, or end users.

2. Classify

Classify your stakeholders using two dimensions: Influence (how much power they have to affect the project) and Interest (how much they care about the outcome). Plotting them on a matrix like this makes it easy to see where your attention should go.

3. Engage

Based on where stakeholders land in the matrix, decide how to involve them over the span of a project:

• Manage Closely (High Influence / High Interest): These are your key players. Involve them in decision-making, collaborate with their teams, seek their input, and address their concerns proactively.
• Keep Satisfied (High Influence / Low Interest): Keep them in the loop with regular updates and address any concerns quickly to prevent them from becoming blockers.
• Keep Informed (Low Influence / High Interest): Provide regular updates to maintain their support and enthusiasm. They care, so don't leave them in the dark.
• Monitor (Low Influence / Low Interest): Watch for changes in their influence or interest levels, but don't expend significant effort on engagement right now.

Communication is the Core Skill

Good stakeholder management is mostly good communication - proactive, honest, and appropriately tailored to the audience.

• Be proactive. Don't wait for stakeholders to come looking for information. Surface progress, risks, and decisions before they ask.
• Be honest about bad news. Delivering bad news early is always better than late. Stakeholders can usually help if they know early - they cannot help if you told them the project was green until it was a crisis.
• Tailor the message. Your manager wants to know what is on track, what is at risk, and what you need. An executive wants the summary and the so-what. Learn who needs what and communicate accordingly.
• Close the loop. When you make a commitment - "I'll get you that report by Thursday" - follow through. Every closed loop builds trust. Every dropped one costs it.

Deliver Bad News By Rocket

Communication effectiveness is crucial when dealing with bad news. Delivering bad news early is always better than late. Stakeholders can usually help if they know early - they cannot help if you told them the project was green until it was a crisis.

That said, delivering bad news is different than constantly harping on project risks. Remember the story of the Boy Who Cried Wolf? Don't be that person. Part of your job as a leader is to help your organization navigate the minefield of risks. Spend too much time lamenting that, and people will rightly wonder about your suitability for the role.

Managing Expectations

One of the most valuable things you can do is set honest expectations early - about what the team will deliver, when, and at what quality level - and then meet them.

Overpromising to please stakeholders and then underdelivering is one of the most common and most damaging patterns in leadership. The short-term discomfort of setting a realistic expectation is always preferable to the longer-term cost of a broken one.

Being aware of your stakeholders and knowing how to engage with them is crucial to delivering results successfully.