Stakeholder management is the process of identifying, analysing, engaging and monitoring the people or groups who can influence, or be affected by, a project (APM, 2023; PMI, 2021). Effective stakeholder engagement contributes to project success by supporting decision-making, increasing stakeholder satisfaction and helping to manage risks and issues throughout the project lifecycle.
A common mistake is to label stakeholders as “difficult”. In reality, stakeholders often have legitimate concerns, competing objectives or organisational pressures that influence their behaviour. Successful project managers seek to understand these factors before deciding how to respond. What appears to be resistance may simply be uncertainty, lack of information or a concern about potential impacts.
The first step in managing stakeholder relationships is identifying who the stakeholders are and assessing their level of influence and interest. Tools such as a Power-Interest Grid can help prioritise engagement efforts (Mendelow, 1991). Stakeholders with high influence and high interest typically require close management, while those with lower influence may need less frequent communication.
Once stakeholders have been identified, project managers should develop a stakeholder engagement approach. This may include:
- Understanding stakeholder objectives and concerns.
- Identifying preferred communication methods.
- Agreeing communication frequency.
- Determining responsibilities and ownership.
- Establishing escalation routes where necessary.
Effective communication is central to stakeholder management. Different stakeholders require different approaches. Senior leaders may prefer concise summaries and decision-focused updates, while operational stakeholders may require more detailed information. Active listening, questioning and empathy help project managers understand concerns and build stronger relationships (Turner, 2022).
Expectation management is equally important. Stakeholder dissatisfaction often occurs when expectations differ from what the project can realistically deliver. Clearly communicating scope, constraints, assumptions and priorities helps prevent misunderstandings and reduces the likelihood of future conflict. Regular updates also ensure stakeholders remain informed about progress and changes.
Despite best efforts, disagreements will sometimes occur. Conflict can arise when stakeholders have competing priorities, limited resources or differing views of success. Project managers should focus on resolving conflict collaboratively by exploring interests rather than positions. For example, instead of debating solutions, it can be more productive to understand the underlying concern driving the disagreement. Techniques such as negotiation, compromise and facilitated discussion can help identify mutually beneficial outcomes (Fisher, Ury and Patton, 2011).
Influencing stakeholders is another important aspect of relationship management. Influence does not necessarily rely on authority. It is often achieved through credibility, trust, evidence and strong communication. Building positive relationships early in the project creates a foundation for greater influence when difficult decisions arise.
Stakeholder engagement is not a one-off exercise conducted during project initiation. Stakeholder needs and attitudes can change throughout the project lifecycle. Regular reviews allow project managers to reassess stakeholder influence, interest and engagement levels, adapting strategies where necessary. Feedback should be encouraged and used to inform future engagement activities.
Where issues cannot be resolved within the project team’s authority, formal escalation routes should be used. Escalation ensures that decisions involving significant risks, costs or strategic impacts are addressed by appropriate governance bodies such as sponsors, steering groups or project boards (PRINCE2, 2017).
Ultimately, successful stakeholder management is about creating collaborative relationships built on trust, respect and open communication. By understanding stakeholder perspectives, managing expectations and addressing concerns constructively, project managers can improve project outcomes and maintain positive working relationships, even in challenging circumstances.
Action Point
Think about a stakeholder relationship you have experienced in a project or workplace setting. What factors contributed to the challenge and how was it managed? Reflect on whether different communication, stakeholder analysis or expectation management techniques could have improved the outcome.