What is a Stakeholder in Project Management?

Stakeholders form the crux of any project. When the project outcome satisfies the Stakeholders’ needs, it is considered a success. Who are the project Stakeholders, though? In project management, stakeholders are individuals who have personal gains from the project's outcome. They actively participate in the project's work or stand to benefit or lose due to the initiative. 

So, who are the project Stakeholders in any given project? A Stakeholder is the project sponsor, usually an executive in the company responsible for distributing resources and enforcing project choices. Customers, subcontractors, suppliers, and even the government might be considered Stakeholders. Stakeholders include the Project Manager, project team members, and managers from different divisions within the company. It's critical to identify all of the project's Stakeholders early on. Leaving out key Stakeholders or their department's role and not realising the mistake until the project is far along might be a project killer.

Project Managers will have difficulty directing their projects through the lifecycle due to the many Stakeholders they must engage with. Any of these individuals may cause the project to fall apart.

Project Managers must deal with individuals from outside the company and the inside environment, which is much more complicated than what an internal manager confronts. Suppliers who are late in delivering critical components may cause the project to go behind schedule. To make matters worse, most Project Managers have little or no direct authority over any of these people. This is all the more reason why Stakeholder management in Project Management is essential.

The following are some ideas for working with upper management:

• During the strategizing and logistical stage of the project, create a well-thought-out outline and important objectives that must be authorized by senior management.
• Find out about the transparency requirements of the functioning of your project's senior management.
• Create a schedule for the status updates.
• Keep them constantly updated on the risks and possibilities involved in the project.

Project Management Group

The project team consists of those who are devoted to a particular project. As a Project Manager, you need to understand the personality and behaviour of each team member in order to engage with them appropriately. It is essential that you respect their experiences and, more importantly, learn from them as well. A constant attitude of appreciation and acknowledgment of their efforts would go a long way in contributing to the project's success. 

A few limitations you could come across while interacting with project team members:

• Because project team members are contracted and do not report to you, they may have other priorities.
• They could juggle many projects in addition to their full-time employment and struggle to meet deadlines.
• There might be personality clashes. These might result from differences in social style or ideals, or they can result from a terrible experience when individuals previously worked together.
• Missed deadlines may only be discovered when it is too late.
• Interpersonal skills are needed to manage project team members. Here are a few ideas to get you started:
• Participate in project planning with members of your team.
• Make plans to meet with each team member personally and informally at several intervals during the project, possibly over lunch or coffee.
•  At all times, be accessible to listen to your teammates' problems.
• Encourage team members to pitch in as required.
• Conduct a team performance evaluation.

Managerial Positions

In many settings, it is the boss who decides exactly would be the scope of the project. It is they who decide who will hold what responsibility in a particular project. Therefore, you need to hold out the boss's trust and earn his support and trust. If you make the boss feel comfortable around you, it would be possible for you to engage in a meaningful way with him/her. Some ways in which you can do that are:

• Identify your evaluation pattern. 
• Request guidance if and when you need it.
• Report your progress constantly to the boss. 
• Frequently communicate.

Also, check :Project manager’s roles and responsibilities

Managing Resources

Other managers control their resources since project managers are in a position to borrow them. As a result, their interpersonal interactions are critical. If they have a strong connection, they may regularly be able to get the finest people and equipment for their projects. If they don't have solid contacts, they may be unable to secure the right personnel or equipment for the job.

Customers from within Organizations

Internal customers are individuals inside the company who are customers for initiatives that satisfy internal requests. The client accepts or rejects your work. Negotiate, clarify, and record project parameters and deliverables early in the partnership. Following the start of the project, the Project Manager must be aware of the customer's problems and challenges and keep them updated.

When working with internal consumers, some of the most common stumbling obstacles are:

• Uncertainty regarding the customer's exact desires
• Insufficient documentation for the desired outcome
• Customer demands for unrealistic timelines, budgets, or requirements
• The customer's apprehension about signing off on the project or accepting responsibility for choices.
• Project scope adjustments

Make sure you perform the following to satisfy the demands of the customer, client, or owner:

• Learn the keywords, culture, and business of the client company.
• In a formal agreement, spell out all of the project's needs.
• Create a method for changing things.
• In the project organization, make the Project Manager the main
• Clients from outside the Organisation

In situations where a particular part of a project or the project as a whole is outsourced to an external agency, such an agency becomes an external client and a Stakeholder. 

Government

Specific sectors/industries are highly regulated. These industries must be in constant touch with government officials at all levels, from local to central. A Project Manager in areas such as medicine, the military, etc., has to be cognisant of this engagement.

Subcontractors, suppliers, and contractors

It has to be noted that not all the resources and skills necessary to complete a project can be sourced from within the organization. This is the reason why external individuals and agencies are engaged for their expertise. This would include construction contractors, raw material suppliers etc.

Contractors and subcontractors may cause a wide range of issues:

• The capacity for workmanship
• Exceeding the project costs
• Not keeping up with the timelines

Many initiatives rely on third-party items. Especially in building projects, all the work is based on the supply of labour, skill and raw material from various third parties. The quality of the project and its timely completion would be put in danger due to issues like poor quality material, excessive costs of the material etc.

A manager has to clearly prioritise managing proper relationships with contractors and suppliers. A manager might also have to be adept at interpersonal skills to achieve this objective.

Benefits of Involving Stakeholders in Project Management:

After understanding the different types of Stakeholders, one might obviously ask, what are project Stakeholders going to do in pursuance of the project? As previously said, the success of every project is determined by the happiness of the Stakeholders. Understanding the requirements and expectations of Stakeholders is critical to a project's success. Stakeholder management in Project Management is significant for the following reasons:

Bring a wealth of knowledge to the table:

Stakeholders often provide essential project knowledge. They have a thorough awareness of the necessary processes and how the sector operates. Their expertise would enable them to provide a set of risks and opportunities involved in the project which a Project Manager may not otherwise be aware of.

Assist in identifying dangers:

The only way to reduce hazards is to recognize them upfront. In such situations, it is important to engage with them at the very start of the project to obtain their input on potential dangers.  

They aid in increasing the likelihood of timely and efficient completion of the project:

Engaging those who are interested in the project from a very early stage provides a very clear picture of project expectations. It also keeps everyone on the same page in terms of project expectations, particularly as the project advances. Continual feedback from stakeholders may heighten their interest in and involvement in the project.  

Conclusion

Identifying project stakeholders and understanding their expectations is crucial for project success. Stakeholders, including sponsors, customers, suppliers, and team members, influence projects positively or adversely. Effective stakeholder management involves open communication, managing expectations, and addressing concerns promptly. Failure to engage stakeholders can lead to project setbacks or failure. By actively involving stakeholders throughout the project lifecycle, project managers mitigate risks and enhance outcomes. Simpliaxis offers a project management course designed to equip professionals with the skills needed to identify and effectively manage project stakeholders, ensuring project success.