Project Stakeholder Management Overview for the PMP Exam

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Hello and welcome to the Project Management Prepcast, your primary stakeholder helping you manage your journey to PMP exam success. I'm your instructor, Cornelius Fichtner. In this lesson, we will give you an overview of Project Stakeholder Management of the knowledge area. Project Stakeholder Management covers the processes that are required to identify all individuals, groups, or entities that are impacted either positively or negatively by the project, analyzing the expectations that they may have, their interests, and impact of the stakeholders on our projects and then, developing effective strategies to both engage them in key decisions as well as to communicate with them throughout the project life cycle. In particular, we'll take a look at stakeholder identification, stakeholder analysis, stakeholder engagement, and stakeholder communications. The official definition of Project Stakeholder Management from the PMBOK Guide is similar to what you have already heard me say. It says that Project Stakeholder Management includes the processes that are required to identify the people, groups, or organizations that could impact or be impacted by the project, to analyze stakeholder expectations and their impact on the project and to develop appropriate project management strategies for effectively engaging stakeholders in project decisions and execution. So much for the definition here, for the basic definition of this. Let's now go and take a look at our processes.

And the four processes that we have in stakeholder management, they help us identify, plan, manage, and control everything that has to do with stakeholder management. And yes, those four words that I have just used, they are always the first words of each of our four processes. Identify stakeholders, that is the first process we have in this knowledge area, the process of identifying the people, groups, or organizations that could impact or be impacted by a decision, activity, or outcome on the project and analyzing and documenting relevant information regarding their interests, involvement, interdependency, influence, and potential impact on project success. Once we have these people identified, we want to plan how to manage them in the Plan Stakeholder Management process, the process of developing appropriate management strategies to effectively engage stakeholders throughout the project life cycle based on the analysis of their needs, interests, and potential impact on project success.

Now that we know who our stakeholders are and we have a plan on how we want to manage them, well, let's manage them in Manage Stakeholder Engagement. That's the process of communicating and working with stakeholders to meet their needs and expectations, address issues as they occur, and foster appropriate stakeholder engagement in project activities throughout the project life cycle. And because we have a plan, because we're doing actual work here, we need to control our stakeholder engagement as well. Making sure we're still on tract here, things haven't changed. This is the process of monitoring overall project stakeholder relationships and adjusting strategies and plans for engaging our stakeholders.

When it comes to the question, well, in to which of our five process groups do these four processes fall, it's really, really easy because of the first word of each process really gives it away. Identify Stakeholders is performed as part of the Initiating process group. Plan Stakeholder Management, that one's performed as part of the Planning process group. Manage Stakeholder Engagement, we do this as part of the Executing process group. And Control Stakeholder Engagement, you guessed it, it's performed as part of the Monitoring and Controlling process group.    

The identification of project stakeholders consists of two sets of activities. The first is Initial Stakeholder Identification which will result in the first list of stakeholders to be analyzed for that specific project we're working on. This involves identifying the people, groups, or organizations that could impact or be impacted by a decision, activity, or outcome of the project. Many of the stakeholders who will be affected by our project, well, they will be obvious, such as the customer, the end-users, sponsor team members, vendors. However, there are certain times when stakeholders exist who may not be readily apparent. For example, on a project of a large bridge needs to be repaired. Obvious stakeholders will be the commuters who use the bridge, but not so obvious maybe the local transit authority who will have to device a system of bridge tolls to pay after the construction. In addition, there may be different stakeholders who will influence a project, who may be immediately apparent and others who may not. Building on the bridge construction, example here, city and local governments will certainly have specific standards that need to be followed. But the impact on the environment might also be needed to be evaluated by an environmental protection agency. The result of performing Initial Stakeholder Identification is a list of project stakeholders called the Stakeholder Register, which contains all of the details related to any individual group or organization that could be positively or negatively impacted by the outcome of the project. And performing effective Initial Stakeholder Identification activities helps project manager, helps you, helps me to properly focus on each stakeholder group or stakeholder individual and how to interact with them throughout the course of the project.  

The second set of identification activities are Ongoing Stakeholder Identification activities which occurs after the initial stakeholders have been identified. These activities, they occur literally throughout the course of the project. Many of these ongoing activities are the same as the ones we just saw on Initial Stakeholder Identification but the emphasis is placed on different areas. As is true on all types of endeavors including projects, resources will come and go as the project progresses. This is also true of human resources in terms of the stakeholders on our projects. The project manager must constantly be aware of and document the changes in terms of those individuals who are either affected by the project or have influence over the project. As the project progresses, the initial identification of stakeholders must constantly be revisited to ensure that the most current and accurate information is available concerning the stakeholders. Most projects, they'll have a diverse number of stakeholders depending on the size, type, complexity, etc. of the project. The project manager should take into consideration the fact that how a stakeholder may be affected by the project or may influence the project may not be fully understood until later stages of the project.  And while performing Ongoing Stakeholder Identification, it is crucial that we as project managers update the Stakeholder Register with any and all changes related to these individuals, groups or organizations that are affected by the outcome of our project or who could influence it. The major benefit of performing Ongoing Stakeholder Identification activities is that it enables the project manager to focus on the relationship with the most important stakeholders on the project. These relationships are necessary to ensure successful project completion. Meetings are an extremely important tool used in many of the processes implemented throughout the course of a project. However, they are especially important when performing initial identification and ongoing identification of stakeholders. Meetings are very effective methods of brainstorming to determine all of the different types of stakeholders that may be connected to a project. In terms of stakeholder identification, these could include meetings designed to develop an understanding of major project stakeholders and can be used to exchange information about the role that different stakeholders will take for the project. This will also help set the stage for more detailed analysis of these stakeholders in these subsequent project stakeholder activities. The types of meetings that can be used during stakeholder identification are numerous and varied and will depend on the size and complexity of your project. These could include meetings to gain expert judgment to help identify and categorize stakeholders, talking with other project managers who have executed similar projects in the past, discussing this with the project sponsor and subject matter experts in the field as well as meeting with previously identified stakeholders who could help us identify additional stakeholders.

The analysis of stakeholders on a project also consists of the initial and ongoing stakeholder analysis. The Initial Stakeholder Analysis involves taking the basic information contained in the Initial Stakeholder Register for each of these stakeholders we have and analyzing it in further detail. In addition to the more general information such as internal, external, what is their role, what is the department of this stakeholder, it's important to go into much more detail and determine things like their interests, knowledge, expectations, influence level with regards to the project. You may also want to determine if stakeholders are likely to support your project or not, whether they have significant influence on the outcome of your project and if they are even interested in its outcome. After each stakeholder on the project has been interviewed and the project manager, you have determined their potential impact or support on the project, they could generate, then there will be the need to classify them in order to define an appropriate engagement strategy for each of them. When dealing with large numbers of stakeholders, it's crucial to prioritize the stakeholders in terms of their influence and interest in the project. This will help to ensure that the engagement and communication effort that we expend on each stakeholder is proportional to the effect that they will have on the success of the project. After performing this initial stakeholder analysis, you will have much more detailed information about each specific stakeholder in the register. Quite often, there is also additional documentation created in the form of some type of matrix that classifies our stakeholders into specific groups according to such things as their level of authority, the level of concern, their active involvement, their ability to affect project changes, and their need for immediate attention. We call this a Power Interest Grid. That's one such matrix. This is also where the Stakeholders Management Plan is created. Performing these initial stakeholder analysis activities successfully will help you, the project manager, identifying effective stakeholder relationships that you can leverage to build coalitions and potential partnerships. This will help to increase the likelihood of success of project execution and completion.

And the second set of analysis activities, here we're talking about the Ongoing Stakeholder Analysis. Of course, we'll be using the same tools and techniques again but we will be focusing more on re-analyzing our stakeholder information on the project. During the course of a project, stakeholder expectations, interests, and influence will constantly change based on a variety of different factors. This could be due to stakeholders taking on different roles, project priorities changing. We've indeed particular stage of completion in which the project is in. It's the project managers’ responsibility to continually identify, analyze these changes so that the project has the most up-to-date information on all project stakeholders. It's also quite common that the initial analysis of stakeholders may no longer be accurate as the project is being executed. Therefore, stakeholders must be re-analyzed so that the project manager and the project team have the most current and accurate information available concerning these stakeholders. Re-interviewing stakeholders at certain checkpoints during the project will help address issues as they arise, manage and resolve conflicting interests and foster continuous stakeholder engagement and satisfaction throughout the project.

While performing this Ongoing Stakeholder Analysis, you as the project manager will be in-charge in updating three key types of documentation which are the Stakeholder Register, the Stakeholder Management Plan, and also any Stakeholder Information Matrices such as this Power Influence Grid that we mentioned earlier on. This includes constantly analyzing and documenting changes resulting from this re-analysis of any individual, group, or organization that is considered a stakeholder on the project. And performing Ongoing Stakeholder Analysis is also very beneficial since it will enable both you as the project manager and your project team to effectively engage and communicate with each project stakeholder based on the stakeholder's current needs. This will also ensure that the relationships with the project stakeholders that were originally forged can be now strengthened and improved, helping to ensure project success.

In order to help us continually re-analyze each stakeholder on the project, we make use of a specific analytical technique which involves analyzing the current engagement level of all stakeholders as compared to the planned engagement levels that are necessary for a successful project completion. And here, we classify our stakeholders by their engagement as Unaware, meaning, they're unaware of both the project and the impact that the project will have. Or we classify them also as Resistant. They are aware of the project and its impact but they are not supportive of the project. Next, we have the Neutral ones. They are aware of the project and its impact but they're neither supportive nor against our project. And then, of course, we have the Supportive stakeholders who are aware of the project and its impact and will support it. And then, finally, we have the Leading ones. They are aware of the project and its impact and they're actively engaged in supporting it. Sometimes these Leading stakeholders, they're also called Champions. Once the level of engagement for each stakeholder is analyzed, the information is input into the Stakeholders Engagement Assignment Matrix which we'll look at in a separate lesson.

As we have seen so far in this lesson, Stakeholder Identification and Stakeholder Analysis, both include initial and ongoing activities. It's the same for stakeholder engagement. Here, we have the Initial Stakeholder engagements activities first. They're undertaken almost immediately after a project is undertaken. This is because the ability of stakeholders to influence the project is usually highest during the initial stages of a project. Therefore, it's extremely important that the engagement of stakeholders occur as soon as possible after the project has been chartered and the project manager, you or I, have been named. This should follow a logical activity after initially identifying and analyzing the project stakeholders. Initial Stakeholder Analysis consists of working with the stakeholders to meet the initial expectations that have been communicated during the performance of the Initial Stakeholder Identification and Analysis activities. By concentrating on performing stakeholder engagement activities at the outset of the project, you as the project manager, are better able to identify and address potential concerns before they actually become issues. The goals of initial stakeholder engagement activities are to increase support and minimize resistance from stakeholders, to develop and communicate realistic expectations for the product and project and to bring out into the open any initial issues or concerns that your stakeholders may have at the beginning of the project. This is so that plans that can be created to resolved these issues and address these concerns very early on. Performing initial stakeholder engagement activities early on in the project helps you to increase the probability of project success by ensuring that all stakeholders clearly understand your project's goals, objectives, benefits, and risks. This helps your stakeholders to become active participants and supporters of the project early on in the project life cycle.

Ongoing stakeholder activities are activities that should be proactively performed by the project manager in an iterative fashion throughout the course of the project. Although the ability of stakeholders to influence the project as we know is usually highest during the initial stages of the project, it's still critical that these stakeholders be engaged in all stages of the project by performing ongoing stakeholder analysis activities. The project manager will always understand the current needs of each stakeholder which may change the type of frequency and engagement with the stakeholders during the remainder of the project. Ongoing stakeholder engagement is performed by identifying, discussing, and clarifying issues and concerns as they arise throughout the course of the project and creating and implementing steps to resolve these issues and address these concerns as soon as possible. It's also important for the project manager to continually engage the stakeholders that are affected by these issues and concerns so that they can help the project manager to accurately assess the risk associated with these issues and concerns in order to develop an appropriate risk response. The main objective of performing ongoing stakeholder engagement is to engage stakeholders at appropriate project stages to confirm their continued commitment to the success of the project. This is accomplished by the project manager through the use of techniques such as being proactive and all tools such as effective communication, negotiation, and conflict resolution. The major benefit of the ongoing and active engagement of stakeholders on the project is that it helps to significantly increase the communication levels on the project. This in turn decreases the risk that the project will fail to meet its stated goals and objectives.

Ongoing stakeholder analysis and engagement are very closely linked and often require the use of an important stakeholder management tool which is the Stakeholders Engagement Assessment Matrix. This tool allows us to assess the level of stakeholder engagement at any time on the project and to make necessary adjustment in stakeholder engagement as needed. The engagement level here in this particular matrix is at the top. We have classified them as Unaware, Resistant, Neutral, Supportive, or Leading. And by the way, you only see two letters in here. You see Cs and you see Ds. C indicates the current engagement level for each stakeholder and D indicates the desired engagement level for each stakeholder. So, for example, we as the project manager, we have both D and the C in the Leading column which is usually a good thing because we as project managers, we want to be leading, we want to be champions of this project. So it's both desired and current that we are in this particular intersection there between leading and the project manager. So that's why we want to be. However, the legal department is currently more of resisting this particular project and we want them to be moving up to supportive, so we have the C, the current under Resistant and we have the D for desired in Supportive. By constantly gauging and updating these stakeholder engagement levels in terms of what is current and what is desired, both of which by the way, may changed throughout the course of the project, gaps between current and desired levels can be identified and actions can be taken to close these gaps through the use of expert judgment by the project manager and project team members. A major portion of the time that you will spend performing the activities of identifying, analyzing, and engaging project stakeholders will be communicating with them. And just as their initial activities and ongoing activities for identifying and analyzing and engaging stakeholders, well there are also initial and ongoing activities for communicating with our project stakeholders. The most important initial stakeholder communication activities that you as the project manager must participate in is the creation of the Communications Management Plan at the very beginning of the project. The most effective way to manage stakeholders and stakeholder expectations at the beginning of a project is via well thought-out communications through the Communications Management Plan. This will ensure that the project manager gets the right information to the right people in a timely manner. So you want to be part of that. Based on the initial discussions with each of these project stakeholders, you will gather a document, each of their specific communication requirements which will help decide the type of information that will need to be communicated. The frequency of the communication of this information and the methods of communication that are preferred by the stakeholders. Part of this initial stakeholder communication also involves the creation of the Stakeholder Register and the Stakeholder Management Plan which will help identify the people, groups, or organizations that have an interest in the project or can influence the project.

It's also important to perform initial stakeholder communication activities with those stakeholders who may only require involvement at the beginning of the project. These could be internal stakeholders who communicate enterprise and environmental factors that influence project communication such as the organization's established communication channels and infrastructures. These could also be external stakeholders such as legal and regulatory agencies or contracted consultants who stipulate specific communication requirements. Understanding all of these specific stakeholder expectations concerning communications at the onset of your project will lay the foundation for all future communication with these stakeholders as well as serving as a template for any new stakeholders who become involved with the project after the initial stages.

Ongoing stakeholder communication is even more important. Once the initial stakeholder communication structure and plans have been created, we must ensure that these are followed for all existing and future stakeholders and are constantly updated to reflect the current stakeholder communication requirements at any specific time on the project. Ongoing stakeholder communication involves constantly ensuring that each project stakeholder receives the information they need at the right time and in the specific format that they have requested throughout the course of the project. This means that we must consistently and constantly ensure that the project team is adhering to the specific stakeholder communication requirements that are outlined in the Stakeholder Register, the Stakeholder Management Plan, and the Communications Management Plan. It's normal during the course of a project for stakeholder communication requirements to change. So we must not only accept the fact that this is inevitable but should also identify when these requirements change as soon as possible. This includes constantly communicating with the stakeholders and ensuring that the existing communications requirements are still valid. Communications technology is advancing at an exponential rate so we must also check the pulse of the stakeholders in terms of their communication needs and be ready to implement changes as quickly as possible when they do change. And of course, as the stakeholder communication requirements change, we must ensure not only that the proper stakeholder communication documentation is updated but also that the proper change request are created and reviewed as part of the performed integrated change control process. This will ensure that none of these ever changing stakeholder communication requirements will ever slip through the cracks and that all stakeholders will always be fairly represented on the project. By ensuring that we as project managers and everyone else on the team follows the ongoing stakeholder communications requirements during the course of the project, we ensure that all stakeholders will receive the information they require at any given time throughout the project, regardless of their interest, expectation, or influence.

We discussed communication methods in detail, obviously in the lessons on Communications Management. Here, it's important for us to review these briefly because we need to understand the different communication methods that are available to us and help maximize stakeholder communication effectiveness. So, the three methods are the Interactive Communication which occurs between two or more parties and involves a multi-directional exchange of information such as meetings, phone calls, instant messages, and video conferencing. We have Push Communication refers to when information is sent to specific recipients who have a need for the information. Letters, memos, emails, voicemails, as an example. And finally, there is Pull Communication, this is used to communicate very large volumes of information to very large audiences such as an Internet site, e-learning, and document repositories. But, why is this important to reminds us of for stakeholder management and stakeholder communication? Well, do you remember the example I gave with my brother who used to print out his emails or rather have them printed out by his secretary so he could read it on paper? Well, if he's on your project, you better know that. You better be aware that Push and Pull is not going to work with him. You better go to him and interactively communicate with him. So in this way, you understand what type of method you are going to apply for each of your stakeholders, which one is suitable for each of your stakeholders.

Let's review. In this lesson, you have learned a stakeholder is anyone who is affected by the project outcome or who can influence the project outcome. Project stakeholder management activities include stakeholder identification, stakeholder analysis, stakeholder engagement, and stakeholder communication. Project stakeholder management also involves activities that are performed for both the initial stakeholders at the beginning of the project as well as iteratively throughout the project as stakeholders come and go and as their engagement and communication requirements change.

And this concludes our overview of Project Stakeholders Management. But before we part ways, let's do one more activity in this lesson. Let's take a look at a PMP exam sample question together. And if you paid a little bit of attention a couple of slides back, this one is going to be easy for you. The question is, which of the following is not a method of communication that is used in the Project Stakeholders knowledge area. Is it: A. Push communication, B. Direct communication, C. Pull communication, or is it D. Interactive communication. I'll give a second to think about this here. The answer is of course, that it is Direct communication, that is the one method not used in this particular knowledge area. Push communication, Pull communication, and Interactive communication, these are methods of communication used in the Project Stakeholder Management. Direct communication is not recognized as one of the valid communication method. In fact, Direct communication is a made-up term that we just used and threw in here to throw you off. It's not even mentioned in the PMBOK Guide. This question tested your specific knowledge of the three and only these three communication methods that are actually listed in the PMBOK Guide.

And with that, we have come to the end of this lesson. So Justine says, “Is that the time? I've got to go.” And I'll say, until next time.

Training for Project Management Professional (PMP)®, PMI Agile Certified Practitioner (PMI-ACP)®, and Certified Associate in Project Management (CAPM)®