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Stakeholder management is a key activity for Product Managers since a product’s success is largely dependent on the efforts of other departments within a company. Without the involvement of stakeholders, ideas simply remain ideas and consequently, it may be difficult to get products developed and launched.

As Product Managers, we’re not only called upon to deliver products that add value in the market but also to lead teams to success. Stakeholder management has to be intrinsically part of the Product Manager’s DNA.

This blog provides some practical tools that can assist you through the stakeholder maze.

What is Stakeholder Management?

In its simplest form, stakeholder management is the process by which an individual establishes and maintains support from internal staff members and external parties for a new product or project or change within the organisation.

There are other definitions:

“Stakeholder management is the process of managing the expectation of anyone that has an interest in a project or will be effected by its deliverables or outputs.”

Project Smart

“Stakeholder management is defined as the management of relationships with individuals or groups. It is a planned approach to engage stakeholders (i.e., project team, end-users, business process owners, managers and executives) in the project’s success. The purpose of initiating stakeholder management is to measure the influence of stakeholders on project perform”

Principles of Stakeholder Management

For successful stakeholder management, Product Managers require information about their stakeholders which includes interests, culture, concerns and opinions.

Use some of the tools identified below for better stakeholder management.

Stakeholder Identification

Brainstorm (alone or in a team) and list the potential stakeholders accompanied with

their interests their power within the organisation their capacity to take action and to implement where do they fit in the organisation their goals organisational and personal; how approachable they are their opponents or supporters the criteria the stakeholder would use to judge the organisation’s performance (expectations of organisation) how well the stakeholder believes the organisation is performing the stakeholder’s judgement

Note: Stakeholders can be individuals or groups or even organisations. Make sure to associate one contact for an organisation or group.

Stakeholder Analysis and Mapping

After the brainstorm session, you’ll have a big list of names accompanied by lots of information about the stakeholder. To structure the list and filter out important stakeholders from less important stakeholders, map the information gathered in different ways. This way you can visualise different relationships eg: power vs interest, influence vs interest. This will help you set out your stakeholder strategy.

A good addition to a stakeholder map is to add how the stakeholders influence each other (Eden and Ackermann). This will help you determine who the most influential or central stakeholders are.

Here’s a list of stakeholder maps that we found:

The Power/Influence vs Interest Grid:

This stakeholder map visualises power vs interest of a stakeholder. According to Eden and Ackerman using this grid helps determine which players’ interest and power bases must be considered in order to address the problem/issue at hand. It highlights coalitions that can be encouraged or discouraged, whose buy-in should be sought or co-opted.

Further, it provides some information on how to convince stakeholders to change their views.

Power/Dynamism Matrix:

This stakeholder matrix from Gardner et al visualises the power a stakeholder has in relation to how dynamic the stakeholder is in changing the position/opinion he/she holds. When dynamism is low the stakeholder’s position/attitude is predictable and their expectations can often be met in a relatively easy way.

Power/Legitimacy and Urgency Model:

The stakeholder model below from Mitchell, Agle and Wood demonstrates the stakeholders’ behaviour. Mitchell, Agle and Wood defined three characteristics:

• Power – to influence the organisation
• Legitimacy – of the relationship and actions with the organization in terms of desirability, properness or appropriateness.
• Urgency – of the requirements being set for the organisation. In terms of criticality, time-sensitivity for the stakeholder

If a stakeholder is placed in area 1, 2 or 3 they are called Latent Stakeholders. These are stakeholders with only one of the three characteristics – for example, an animal rights group can have an urgent issue, but with neither power nor legitimacy, they can have demands but not get the management attention they need.

Stakeholders in area 4, 5 or 6 are called Expectant Stakeholders and have two of the three characteristics. These stakeholders are typically employers and investors. The stakeholders that have all three characteristics in 7 are called Definitive Stakeholders and always take top priority.

Problem-Frame Stakeholder Map:

It is good to know who your supporters are but it also worthwhile knowing who isn’t a supporter. This stakeholder map from Anderson, Bryson and Crosby gives you an overview of your supporters and opponents and the power they wield within the organisation.

Participation Planning Matrix:

Depending on the subject of the problem/issues/ discussion point it will be necessary to approach each stakeholder in a different way. The Participation planning matrix provides you an overview of who and how you need to approach a stakeholder for different problems/issues/discussion points.

Another Example of a Stakeholder Map:

This diagram below created by Glenn Hughes illustrates the relationship with the stakeholders (here displayed as the client) and gives feelings how the stakeholder thinks about the product/service/project/change.

• Lines – indicate the relationship (solid = strong, dotted = weak, none = none)
• Circle Size – equals the relative size/importance/influence of the stakeholder
• Circle Colour – equals how the stakeholder thinks about the product/service/project/change (green = good, yellow = medium, red = bad, black = no feeling)

The Stakeholders with a big green circle and a solid line will be key Stakeholders for the project.

Stakeholder Strategy

Once your stakeholders (opponents and supporters) have been identified and the information is analysed and mapped in ways that provide you with a clear picture of the stakeholder landscape, you’ll need a stakeholder strategy. Your strategy at a minimum should include:

• • Stakeholders that need to be addressed and the ways to approach them.

Determine who is on your team and can help you get other stakeholders on board?

Find common good and structure a winning argument around this.

Good stakeholder management is a combination of planning and communication. Having the knowledge will provide you with confidence to approach and expertly manage your stakeholder.

Learn more about Stakeholder Management in our upcoming Essentials of Product Management course.

References

1. John M. Bryson (2004) “What to do when stakeholders matter”
2. www.12manage.com
3. www.mindtools.com
4. www.wikipedia.org