Stakeholders are those who have a positive or negative impact on the project’s output. It is critical for an effective project manager to identify the names of stakeholders during the project’s initiation stage. Stakeholders can be both external and internal.
Customers, clients, project team members, functional managers, account managers, operation managers, sellers, buyers, sponsors, and so on are examples of stakeholders. A project manager must identify stakeholders and manage their expectations throughout the project’s life cycle (s).
Internal stakeholders include other managers and employees who are located within the company and have an impact on the project’s daily operations. External stakeholders are those who are not directly involved in the project but can influence its activities in a variety of ways. The government, neighbors, pressure groups, political parties, local councils, and the surrounding communities are among them.
We will go over the following topics in depth in this article:
Identifying key players
The impact of stakeholders on projects
Coordination with a worldwide team
Effective communication method with stakeholders
Stakeholder Management Is Critical
The Benefits of Managing Stakeholder Expectations
Disadvantages of failing to manage stakeholder expectations
Determine your stakeholders.
Ideally, a project manager should identify the stakeholders early on, as missing out on any key stakeholders during that time period will cost a lot of money. It is an initiation process in the communication knowledge area, according to PMI®.
The Effects of Stakeholders on Projects
Ignoring any of the stakeholder’s expectations can be very costly, and it can have a significant negative impact on the project, such as delivery delays. Assume you require resources to complete the project as planned, and you have managed the expectations of your HR manager positively, you will almost certainly receive soft support from your HR manager because you managed his/her expectations at the outset, and the result could be the opposite if you did not manage his/her expectations at the outset.
Furthermore, in order to ensure the required output, a project manager must manage the influence of all stakeholders in relation to the project requirements. The project manager should protect the interests of the stakeholders while balancing the project’s requirements.
Stakeholder Management Is Critical
Stakeholder management is unquestionably an important aspect of a successful project relationship. Stakeholder management entails establishing a positive relationship with and understanding of all stakeholders, as well as how their work contributes to the overall success of the project. You must keep this in mind at all times: stakeholders can provide constraints or requirements based on their previous projects, deliveries, and experiences. Managing your stakeholders, on the other hand, will assist you in identifying potential pitfalls and risks for your project.
Coordination with a Worldwide Team
If you are working with a geographically dispersed team, you should be aware of the best methods of communication with that team in order to work effectively. And these things should be written down at the start of the project and communicated to them in advance in the required language. You can easily manage a team on a global scale in this manner. It can save you a lot of time on your project.
Effective Communication with Stakeholders Mode
A project manager should be aware of all identified stakeholders’ modes of communication and times of communication (in the case of a virtual team). A well-discussed report format (MS-Word, MS-Excel, Power Point) can significantly reduce communication issues. As a result, a project manager should be aware of the appropriate format that stakeholders require for viewing progress reports, work status reports, trend reports, and so on. Many controversies can be avoided by implementing these reporting systems.
The Benefits of Managing Stakeholder Expectations
If you have successfully identified your internal and external stakeholders, it is always a plus for your project. Ideally, you should involve your key stakeholders from contracts, SOW, project charter creation (if a project manager is doing this), and he/she should be involved in effective planning stages. As a project manager, you should keep track of their expectations on a regular basis so that you can align the project requirements with theirs. Meanwhile, you must maintain your milestone dates, quality planning, cost budgeting, and overall performance baselines while balancing stakeholder expectations. If you manage all of these, your project will be perfect in every way. You can save time and money by effectively managing stakeholder expectations.
Disadvantages of Failing to Manage Stakeholder Expectations
Your project can be effectively hampered if you fail to include any key stakeholders and their expectations. The stakeholders are referred to as the skeleton of any project. You will be unable to complete your project without their assistance. In any case, if you fail to include key stakeholders, your project is doomed. They can cause a lot of problems in your project. They have the ability to demand an unacceptable scope change, which can have an impact on pricing, timing, and the schedule. As a result, you should define scope wisely, involving key stakeholders, so that you can effectively monitor the scope in accordance with the scope baseline. This is certain: if you fail to identify and manage stakeholder relationships, your project will be over-budget and behind schedule.
