Adrienne Tan, updated in September 2019.
Pretty much every Product job description these days says that ‘stakeholder management’ is a key priority. But what exactly is stakeholder management? What are the best tools to manage stakeholders? And how do you become a stakeholder master/ninja/guru/jedi?
Great Product Managers are part arm-chair psychologist, part scientist (to quote Bo Ren) and part politician (to quote Adrienne Tan) – you’ve got to have all these skills to juggle your stakeholders effectively.
The reason stakeholder management is so important for Product Managers is that a product’s success is largely dependent on the efforts of other people and departments within a company. Without the involvement of stakeholders, ideas simply remain ideas and it’s nearly impossible to successfully develop and launch products.
As Product Managers, we’re not only called upon to deliver products our customers love, but also to lead teams to success. Every great product manager has stakeholder management hard-wired into their DNA.
What is stakeholder management?
There are many definitions of stakeholder management, but the simplest way of describing it is the way in which an individual establishes and maintains support from colleagues and external parties for a new product, project or change within their organisation.
Use some of the tools identified below for better stakeholder management.
Three steps for great stakeholder management
For successful stakeholder management, you really need to understand your stakeholders. You need to know what drives them – what they’re worried about, what they’re interested in and what they’re trying to achieve.
Over the 20+ years I’ve been working in product management, I’ve worked out three steps to better manage stakeholders and found the best tools to make it happen.
1. Stakeholder identification
Alone, or in a team, list potential stakeholders as well as:
Note: stakeholders can be individuals or groups or even organisations but you should try to decide one key contact for each organisation or group.
2. Stakeholder mapping
You should now have a big list of names accompanied by lots of information on each stakeholder. To structure your list and filter out the important stakeholders from the less important ones, it’s often useful to map your stakeholders so you can visualise different relationships eg: power vs interest, influence vs interest. This will help you decide your stakeholder strategy.
Here’s the most useful stakeholder maps that we found. Either choose the one which you think best meets your needs, or try a few and see which works best for you.
Power mapping tools
These tools all help you map power dynamics in your stakeholders, combined with other factors like influence, dynamism, urgency and legitimacy.
The Power/Influence vs Interest Grid
According to Eden and Ackerman using this grid helps determine which stakeholders’ interests 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 helps you understand how to convince stakeholders to change their views.
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 stakeholders’ behaviour based on three characteristics:
- Power – to influence the organisation
- Legitimacy – of the relationship and actions with the organisation in terms of desirability, properness or appropriateness.
- Urgency – of the requirements being set for the organisation in terms of criticality and time-sensitivity
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
As well as knowing who your supporters are it’s also worthwhile knowing who could cause you problems. This tool from Anderson, Bryson and Crosby gives you an overview of your supporters and opponents and the power they wield within the organisation.
Relationship, influence and feel map
This mapping tool, created by Glenn Hughes, is a great way of mapping out the strength of the relationship you have with all stakeholders (here displayed as clients) their importance and also what each 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 largest green circles with solid lines will be key stakeholders who can help you positively influence the project.
3. Stakeholder strategy
Once you have identified your stakeholders (opponents and supporters) and analysed and mapped them so you have a clear picture of the stakeholder landscape, you’ll need a stakeholder strategy. Your strategy at a minimum should include:
- Stakeholders that you need to work on, or win over, and the best ways to approach them.
- The people who will support you to get other stakeholders on board
- Find common good (what will benefit everyone) and structure a winning argument around this.
Depending on what you’re trying to do, and who your stakeholders are it may be necessary to approach each stakeholder in a different way. Here’s a couple of tools which can help you achieve this:
The Simple Stakeholder Strategy
A quick way of bringing this all together is to put your stakeholders into a table along with your goals and what you’ll do to achieve each goal. It’s a good idea not to have too many stakeholders because you’ll always be short of time, so just stick to the most important ones and rank them so that if you’re particularly short on time you know which ones to focus on.
It’s important to spend a bit of time crafting your stakeholder story though. To convince stakeholders you’ll need data (for the rational argument) plus a story (for emotional resonance and so they’ll remember it) and then you need to weave these together to make a convincing story which will make your stakeholders take action. It’s often a good idea to simplify this into no more than three key messages for each stakeholder (and keep these as similar as possible across all your stakeholders).
The Participation Planning Matrix
This tool is more detailed and gives you an overview of the importance of each stakeholder (ranked from least important ‘inform’ to most important ‘empower’) as well as an approach to follow from the initial stages of engagement to the monitoring and evaluation of your success (or not). You can read more about how to implement this approach in this article by John Bryson.
The Participation planning matrix provides you an overview of who and how you need to approach a stakeholder for different problems/issues/discussion points.
Great stakeholder management is a combination of planning, communication and practice. While it takes time to do well (what doesn’t!) if you follow the steps above (and practice, practice, practice) your stakeholder management skills will soar and so will your Product and career success.
Learn more about Stakeholder Management in our upcoming Essentials of Product Management course.
Liked this blog? You might also like:
- Stakeholder management for Product Managers – ten quick tips to kick butt and have influence
- Recoining ‘stakeholder management’ to ‘stakeholder relationships’ – although commonly known as management, really it’s about relationships.
- Are you cut out for Product Management? – Product Management is an amazing career, but it’s tough. How do you know if you just aren’t suited to it?