Project Assurance Resources

Managing Project Stakeholders

The information in this guide is intended for general purposes only. For more specific guidance around your organisation’s projects, please get in touch with our team.

In this section, you will find:

Anyone involved with a project will come into contact with a stakeholder. At its core, a stakeholder is anyone who has a direct interest in the project. In fact, a team member of a delivery team is arguably a stakeholder. For many projects in large organisations, however, ‘stakeholder’ is a catch all term used to describe any of the following:

  • Senior people who have some interest in the project outcomes,
  • People who own part of the business that will be impacted
  • People outside the project and/or organisation who can influence the project’s success
  • People outside the project and/or organisation who will receive (and hopefully benefit from) the project’s outcomes
  • Anyone else who might need to be kept informed about the project
With so many people potentially stakeholders in a project, it’s important for the project to know who’s who and what level they need to be engaged with, so that the approach to engagement is matched to stakeholder needs. .

Relationship management in business isn’t an easy job. So when project managers have to juggle dozens of these relationships, it’s extra important to be organised and confident in the status of the project. In this guide, we’re going to offer some tips for managing stakeholders to keep relationships positive and projects on track.

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Involve stakeholders from the start

The quickest way to make a senior stakeholder hostile toward a project team is by making them feel excluded. This is rarely done deliberately, yet is so easy to inadvertently happen in a project where many relationships are in place and the team is busily working on delivery.

Keeping stakeholders involved from the beginning sets a tone for the rest of the project. They should be right across the purpose of the project, have direct buy-in to its benefits, and, crucially, understand where the project starts and finishes.

The stakeholders that are involved at the beginning also have the opportunity to negotiate with leadership around what the outcomes and scope of the project is. Having these robust discussions before any of the project team starts working will pay dividends later on. Project managers will have far fewer disagreements to manage when they know stakeholders have been informed at the start.

Ensure progress reporting reaches the right people

Reporting on the status of the project is a high priority task for any project manager. Through assessment of deliverables against milestones and budget, the PM can demonstrate what shape things are in. And conversely, a lack of this information puts an organisation in a precarious position of not knowing whether they’re dealing with a success or failure. Reporting is essential for decision making by not only the project management office but the steering committee and leadership.

Reporting as to the achievements and progress on the project should also hit stakeholders in some format. This may not be as detailed as the granular gantt chart and project expenditure, but rather summarise where things are at and be digestible to a time poor senior staff member. Some things you may wish to include in reporting to stakeholders:

  • Achievements within that month/time period.
  • Milestones of the project and how the project’s tracking.
  • Challenges on the project and what help you may need.
  • Reiterating the scope and desired outcomes.
  • Heads up on any changes made to scope.

Reporting is as much about a stakeholder being considered as it is them being informed. It will go a long way to keep the relationship strong.

Embed governance and decision making processes

Stakeholders in an environment that isn’t governed by any project management framework can quickly turn to chaos. Ideas and demands need to come through a process that ensures consistency. When there’s a disagreement, the project governance will dictate how this is to be resolved – and who has the final word on what matters.

Putting together project governance takes a bit of time; risk assessment, sign off processes and accountabilities are just some of the tasks required. But the time this takes pales in comparison to the hours, days and sometimes weeks worth of debate around a particular feature or decision made within a project where stakeholders feel inclined to challenge the plan in the absence of clear parameters.

Organisations should do the due diligence and build their projects on a strong foundation. In our research via the Project Health Check, we know that 40% of responses felt governance was not working well. So even if governance does exist in your project, make sure it will stand up to the pressures of multiple stakeholders.

Plan which stakeholders are best to be involved in what parts of the project

A common misconception is that all stakeholders need to approve everything. Designing a project for success actually means lining up the right people for the right job. Your project delivery team may include people that need to work on certain phases but not others; the same applies with your stakeholders. Now, this doesn’t mean that you shouldn’t keep all stakeholders informed about the project for the duration, but rather they need not be required for hands-on work or sign off for the entirety.

A RASCI model can indicate where certain stakeholders should be consulted or involved. Part of your broader project plan should outline at which points stakeholders are needed, and this should be reviewed and acknowledged prior to delivery getting underway.

For example, you may be rolling out a new intranet project. The stakeholder in charge of internal communications may need to be involved at the start, during user testing and leading up to full roll out. They won’t be needed when the development team is deep in code and negotiation which features are in or out of scope.

Map stakeholders to the project’s requirements, and make sure these are communicated effectively.

Don’t leave stakeholders in the dark about key decisions

There are moments within a project where the direction may shift. A feature may be dropped for budget reasons. A risk may have caused the need to pick one vendor option over another. Whatever it is, any significant events that alter the outcome or process of the project should be communicated to those senior stakeholders most closely engaged with the project. Assuming it’s not relevant to them could inadvertently lead to stakeholders feeling excluded from the process and without a voice. These situations can lead to escalation to a steering committee or leadership team as a sign that governance isn’t working properly.

But worse still for the project, a stakeholder who may otherwise represent the interests of part of the business can miss important information that they’d be able to provide valuable direction on. Stakeholders aren’t a sign off process; they’re important parts of the project’s success.

It’s far easier to include stakeholders who can then opt out of certain communications at their discretion.

Practice empathy with stakeholders

If you’re reading this you may be a senior leader, project manager, project team member, or a stakeholder yourself. What’s easy to forget when managing many relationships is that stakeholders themselves are managing big responsibility and often many people.

When disagreements or conflict arises, it’s always a good idea to consider the stakeholder’s perspective. Understand that their viewpoint is likely tied to their own set of key performance indicators (KPIs), which in turn are KPIs of their business unit. A project that may impact these KPIs negatively is going to be an issue. Sometimes the resolution will be minor with more explanation, but in other circumstances it will need to be worked through with senior leadership.

While there’s no space for rudeness or hostility in a well-functioning organisation, being mindful and empathetic to stakeholders’ concerns gives you more chance of building a stronger long term relationship. Stay true to the governance framework and scope, but don’t neglect to be human as well!

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Protect the project from misaligned stakeholders

Stakeholder requests that go against the scope of the project need to be managed very carefully. The milestones of the project are designed to deliver the business outcomes. If a stakeholder pushes additional or different work to be done, this cannot come directly into the project team; it needs to go through a process outlined in the governance framework that may be reviewed by a project steering committee.

The challenge for project teams exists when seemingly ‘minor’ requests by stakeholders directly of the project team start to pile up and derail the project. This is where the project manager needs to protect their team by empowering them to redirect such requests back in via the project management function. It can be tempting to placate a ‘simple’ request. In large organisations these combined cause real issues.

Keep the scope and outcomes continually communicated

A big part of stakeholder relationships is what you do leading up to sign offs and decision making conversations. Proactive communication around the project’s outcomes and scope helps to remind all those involved the purpose of this work. It’s a particularly common occurrence in projects that last a long time for there to be some loss in focus around outcomes, so project management and leadership can work together to keep stakeholders up to date on what the goal is.

When it comes to a disagreement about a deliverable, this communication will help give familiar context to those stakeholders in question.

Significant conflicts need to involve a steering committee or leadership

Sometimes things don’t get resolved at the project management level. It’s less common but does happen in New Zealand organisations in both public and private sectors. When the stakes are high, your stakeholders will think carefully before signing something off. It’s understandable that when stakeholders feel the outcomes will not reflect favourably on them that a stalemate can occur.

Involving senior leadership isn’t a negative thing in these cases; it’s a means to ensure that decisions are being made with full support of the business and awareness of potential impacts.

Keep an open mind to stakeholders’ thoughts on the project

The scope of a project is a central artefact that should be referenced frequently. But the reality is that no scope is perfect. Sometimes a stakeholder will have a viewpoint or idea that while in practice would be out of scope, may be something the business needs to consider carefully. Don’t hastily shut down stakeholders’ ideas – consider these and if there’s potentially more to think about, use your governance process to defer this conversation into a steering committee meeting.

Where to next?

Read our other project resources:

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Setting project milestones

Staying on track isn’t just a matter of delivering on time, but controlling costs too. We offer some useful tips when setting project milestones.
Learn More >>

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How to avoid project failure

Project failure is something every organisation wants to avoid. We touch on some of the approaches to preventing things going wrong.
Learn More >>

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Identifying project risks

Risks exist in all organisations. It’s how we prepare, adapt and navigate these risks that makes projects successful. Read our guide on spotting and dealing with risks to a project.
Learn More >>

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Understanding project governance

All the structure and processes around how a project is delivered can mean the difference between a successful project or not. Learn what governance is and how it can help.
Learn More >>

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What causes scope creep

Scope creep affects every project manager or project team member at some point in their career. In this guide, we explore what some of the causes are.
Learn More >>

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Managing project stakeholders

In this guide, we offer some tips for managing stakeholders to keep relationships positive and projects on track.

Learn More >>

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