0.4 Project stakeholders

A project is successful when it achieves its objectives and meets or exceeds the expectations of the stakeholders. But who are the stakeholders? Stakeholders are individuals who either care about or have a vested interest in your project. They are the people who are actively involved with the work of the project or have something to either gain or lose as a result of the project. When you manage a project to add lanes to a highway, motorists are stakeholders who are positively affected. However, you negatively affect residents who live near the highway during your project (with construction noise) and after your project with far reaching implications (increased traffic noise and pollution).

The project sponsor, generally an executive in the organization with the authority to assign resources and enforce decisions regarding the project, is a stakeholder. The customer, subcontractors, suppliers and sometimes even the Government are stakeholders. The project manager, project team members and the managers from other departments in the organization are stakeholders as well. It’s important to identify all the stakeholders in your project upfront. If you leave out an important stakeholder or their department’s function and don’t discover the error until well into the project, it could be a project killer.

[link] shows a sample of the project environment featuring the different kinds of stakeholders involved on a typical project. A study of this diagram confronts us with a couple of interesting facts.

• First, the number of stakeholders that project managers must deal with assures that they will have a complex job guiding their project through the lifecycle. Problems with any of these members can derail the project.
• The diagram also shows that project managers have to deal with people external to the organization as well as the internal environment, certainly more complex than what a manager in an internal environment faces. For example, suppliers who are late in delivering crucial parts may blow the project schedule. To compound the problem, project managers generally have little or no direct control over any of these individuals.

Let’s take a look at these stakeholders and their relationships to the project manager.

Top management

Top management may include the president of the company, vice presidents, directors, division managers, the corporate operating committee, and others. These people direct the strategy and development of the organization.

On the plus side, you more likely to have top management support, which means it will be easier to recruit the best staff to carry out the project, and to acquire needed material and resources; also visibility can enhance PM’s professional standing in the company.

On the minus side, failure can be quite dramatic and visible to all, and if the project is large and expensive (most are) the cost of failure will be more substantial than for a smaller less visible project.