Understanding and engaging stakeholders should be the top consideration of any large and complex project. Defined as anyone or group that has a stake in the outcome of a project, successfully engaging your stakeholders is the litmus test for the success of your project and ultimately delivering business value.
Statistically, ninety percent of large and complex strategic projects fail. The good news is that ten percent succeed and go on to improve the way organizations interact with and improve the lives of their stakeholders. Keeping this in mind, crucial questions to ask when starting a project begin with “Who.” Who approved this project? Who wants this project? Who will be affected by this project? Who is doing this project?
Understanding stakeholders and engaging them effectively is a fundamental aspect of good project management that contributes heavily to the success of any project. Below are the top ten reasons why stakeholder engagement is necessary when it comes to successful project management.
Making Decisions: Stakeholders, especially those in a position of power and influence, play a vital role in making important decisions for projects. Whether the decisions are related to funding or resource allocation, it is important for project managers to work collaboratively with stakeholders.
Providing Guidance: Very few projects, even smaller projects, are without surprises. Larger and more complex projects are full of unknowns and changes, a phenomenon I call Murphy’s Law on Steroids. “Anything that can go wrong, will go wrong,” is a fundamental rule of any project. Complex projects often have an added problem where, “Things that cannot go wrong, may also go wrong.” Thus, it is vitally important to engage stakeholders and ask them for guidance.
Managing expectations: As a follow-up to the above point, projects are rarely straightforward and changes are inevitable. As projects take detours and regroups, project managers need to work closely with stakeholders to navigate these changes and reset expectations to maintain, and hopefully gain more, support.
Defining Scope: Key stakeholders, such as customers and sponsors, are the people who provide the vision, establish requirements, and prioritize them. In addition, by asking the stakeholders about their goals, projects can more astutely and accurately define the right outcomes early on in the project. One of the worst mistakes project managers can make is when after spending all their resources and sweat, their customers or users fail to adopt these changes. In short, while the project may be technically completed, practically speaking, it was a complete waste of time and resources.
Championing Change: Inherently, most people dislike change, especially in strategic and transformative projects where change can be substantial and disruptive. Project managers should strive to understand how changes will impact their stakeholders, address these concerns, and ideally find and nurture change champions to ease resistance and achieve greater adoption.
Tackling risk: Projects are surrounded by uncertainties, from the known unknowns such as the uncertainties of securing employee support from previous similar projects, to unknown unknowns in which the project managers have no visibility. By effectively working with stakeholders, project teams can gain insights into potential challenges and obstacles earlier, allowing for better risk identification, assessment, and management.
Allocating resources: Let’s face the reality, other than the tiny or very well-defined projects, project managers are often just guessing at the resources that are required. This is especially true for strategic projects in which there are little precedents. By working with stakeholders well, project managers are more likely able to secure the right funding, talent, equipment, and other requirements necessary for the project.
Resolving conflicts: Project disagreements are common, and when they are not dealt with early and effectively, then can spiral into conflicts. For experienced project professionals, conflicts of priority, differences over processes, and personality clashes are all too commonplace. But by understanding the perspectives and concerns of various stakeholders, project managers can identify those troubled areas early and lessen conflicts. When conflicts do flare up, they can be more effectively addressed and resolved.
Developing teams: Every project manager dreams of creating a high-performance team. Yet, chances are there are only a few noted examples of such teams. One way to develop such a team is to truly understand the motivation behind core team members, and structure their roles accordingly. When this is wisely done, these stakeholders are likely to be more productive, motivated by common goals, and supported.
Building trust: Perhaps the most important reason to pay special attention to “who” the project is being initiated for, is to enable the building of trust. By regularly engaging with and understanding people’s interests and goals, project managers can foster trust. Trust can be invaluable, especially when dealing with risks and challenges.
Working with people is unavoidable, and thus project professionals have two choices: managing them proactively and reaping the rewards, or neglecting them and living with pain points at every juncture.
Dr. Te Wu is CEO and CPO of PMO Advisory, a project management training and consulting firm that establishes projects, programs, portfolios, and PMOs for companies, including Global 500 and nonprofit organizations.
He is an Associate Professor at Montclair State University and Chair of Project Management Institute’s Portfolio Management Standard Committee. Te is certified in Portfolio, Program, Project, and Risk Management.