Why stakeholder management is important to project success
Estimated Read Time: 4 minutes
We often talk about stakeholders in business, however, the importance of stakeholder management is at times not given the attention it deserves. Stakeholders can be both internal and external, actively involved or watching from afar, but the common thread between them is that they have an impact on the success or failure of your organisation.
If we narrow the focus to their impact on specific areas of the business, their role in the success or failure of projects emerges as a key point. When stakeholders are actively involved and working together, the likelihood of reaching your project goals is high, while on the flipside, if there is conflict and a lack of engagement, projects aims can be extremely difficult, if not impossible, to achieve.
In light of this, understanding why stakeholder management is important to project success is a crucial aspect that must be considered. So to find out how to harness this valuable skill and utilise it to achieve better project outcomes, read on to learn more.
Stakeholder management skills defined
Stakeholder management skills are a highly-valued attribute in those managing projects across finance, technology and business support functions, as well as many other sectors. Broadly they include a range of both soft and technical skills. Some of the essential skills include:
Insight: The ability to identify each and every stakeholder associated with the project and understand where they fit within the planning, scope and delivery of the outcomes, sets the team up for success.
Communication: Effective communication with all stakeholders throughout the life of the project is important and should be a two-way street. Listening to their concerns, ideas and desired outcomes, alongside keeping everyone informed ensures cohesion and harmony and minimises the risk of conflict.
Organisation: For large projects in particular, you will have many stakeholders, all with different levels of involvement. Accurate and organised grouping of stakeholders allows for more effective communication, and makes it easier to monitor engagement and satisfaction levels.
Related: Find out how to improve your conversation skills in the workplace
Why stakeholder management is important to project success
There are many reasons why stakeholder management is important to project success, on both a macro and micro level. Let’s take a closer look at our top 5 reasons below:
As stakeholders are by definition impacted by the project in some way, understanding their needs and expectations is a must. Consulting with stakeholders and listening to what they say allows for expectations to be clarified and agreed upon right from the start.
Foster strong relationships
Establishing and maintaining good relationship with stakeholders will make the project outcomes (no matter what they are) much easier to achieve. Trust and mutual respect are key to this. Stakeholders often have the power to support or block projects, and relationship management is a key factor in getting them on your side.
Boost engagement and motivation
To effectively manage a project, everyone involved must be crystal clear on their roles and responsibilities, and this includes all stakeholders, both internal and external. No matter their level of involvement, when stakeholders are aware of how they are contributing to the project, they will be more engaged and motivated to make it a success.
With competing or opposing ideas and desires involved, it is not uncommon for conflict to arise at various stages throughout a project. When issues are identified early and managed appropriately, less time and energy is lost, allowing the project to remain on track.
While in the past it was common for stakeholders to take a backseat, today, organisations are seeing the benefit of encouraging a more proactive and collaborative approach with stakeholders. Much can be gained from actively involving them in the decision-making process, both in agreeable short-term results and the potential for ongoing collaboration in the future.
“Stakeholder management is important nowadays when employers recruit a talent to their company. It can determine the best tactics for effective communication while making the best use of available resources. When it comes to strategic planning, stakeholder engagement is critical and it can be the difference between project success or failure. Communicating with different stakeholders can give you different advantages such as good insights, better decision making, risk management and even managing conflicts inside n organisation. Therefore good stakeholder management skill can definitely add value to the business and become one of the key point during recruitment process.”
- Jonathan Lee, Associate Director and specialised finance and accounting recruiter
Stakeholder management skills in action
So how do stakeholder management skills relate to project success across the different functions of your business? The way in which stakeholders are managed within individual projects vary, based on the size, scale, scope and focus. The level of management individual stakeholders require will also vary depending on their level of involvement, which may change at different stages of the project too.
With so many variables, effective management is heavily reliant on the information mapped out in the planning stages which identifies who the stakeholders are and what they expect from the project. Gathering and collating all the necessary information on stakeholders at the beginning, allows project managers to keep stakeholders informed and engaged throughout.
Boost stakeholder management in your business
Looking for someone with strong stakeholder management skills to boost the success of your projects? The expert team at Robert Half can help you find them. Request talent today.