How to Develop Effective Stakeholder Management Strategies
Do you know you are a stakeholder? You might don’t, but you are. Here in this blog, we have elaborated about what stakeholder is in business and ways to develop Stakeholder management strategies.
For a business to succeed and to dominate a market, it needs a great product or service to offer value to its consumers. To work on the said product, business needs a team of dedicated members. Additionally, the business has several elements that coordinate and works together to attain the objective. In broad term financial management, strategic planning and stakeholder management are the most crucial aspect of business in determining the project’s success. But often, stakeholder management is overlooked over amidst other factors. A deep understanding of who they are stakeholders? What are their needs? How to manage them effectively? Can make or break a business.
What is Stakeholder?
Still, are you puzzled about how you are a stakeholder? Then its time to break your curiosity. Stakeholders are any individual or party that has an interest in a company or whose actions could affect the company or get affected by the business. So, a stakeholder is any person, professional, employees, organization that his stake in the business activities. A stake is an interest in the business or its activities. It can be a varied type of interest like ownership or property interest, legal interest, moral rights, etc. Generally, in a typical business, primary stakeholders are employees, investors, customers, suppliers. But modern theory of stakeholder is beyond the traditional notion and includes new stakeholders like community, groups, government, trade associations, etc.
Understanding the Stakeholder
Whether its an internal or external stakeholders’ coordination in-between them aids the business in achieving success. Internal stakeholders are those whose interest comes through direct-relationship with business, such as employees, investors. External stakeholders don’t directly work with the company but are affected by the actions. These are suppliers, brokers, creditors.
Stakeholders Vs. Shareholders
For the success of a project and smooth functioning of business, stakeholders and shareholders are the two crucial aspects. But often stakeholder is contrasted against shareholders.
Stakeholders bind with a business for vested interest, especially for the long term and for greater reasons. But shareholders only have a financial interest with the business and can sell the stock anytime when thinks profitable and move out of the business.
What is Stakeholder Management?
The business couldn’t ever succeed without its stakeholders. Projects and businesses fail if stakeholders’ requirements are given zero priority. Stakeholders has the power to make your project win or fail. So, stakeholder management should be on top of your list while designing project planning efforts.
Stakeholder management is the process of analyzing the requirements and demands of the stakeholders and acting upon it in order to elevate the relationships and bonding with the stakeholder. It’s a systematic approach that starts with identifying the stakeholders, analyzing their needs, planning strategies to engage with them. A good stakeholder management process will build a quality relationship with your stakeholders.
Benefits of Stakeholder Management
Companies that have started investing in building or developing relationships with stakeholders have started reaping numerous benefits like improvised risk management, greater efficiency, increased support, and several other better outcomes. When stakeholders feel like engaging in a business, it improvises efficiency, reduces delays, etc.
Stakeholder Management Process
Stakeholders can adversely impact the project development phases. A stakeholder can be a supporter and a resistor. Stakeholder management is a complex process that proceeds with the identification of stakeholders, analyzing requirements, development of strategies to work with stakeholders, and executing the process. Communication is a crucial aspect when talking about stakeholder management. Project managers are solely responsible for identifying the needs and influence of the stakeholders and manage them effectively.
- Stakeholder Identification: The process of identifying the individuals who are impacted by the project is called identifying the stakeholder process. You can just start off by noting down the names of anyone and everyone who got affected by the project.
- Stakeholder Analysis: A qualitative and quantitative analysis needs to be done to determine the interest of stakeholders in the project. Acknowledge their needs, demands, objectives, and concerns. Some stakeholders are of greater importance and need to be concerned more and therefore need to be prioritized to maintain their support in your project.
- Communication: Plan on how you are going to communicate with your stakeholders. As you have identified and analyzed your stakeholders, now is time to plan about how efficiently you can communicate with them. It is better to have a pre-determined communication plan assists in the smoother running of the process without having a negative impact. Visuals also play an immense role in elevating your communication standards. Find splendid presentation templates here at PowerPoint Templates gallery.
- Management: Often, ask stakeholders to participate in business functions. Involve them in creating goals and objectives. It makes them feel welcomed and enhance their interest and efficiency in the project.
- Stakeholder Mapping: It’s the process of categorizing the stakeholders. Stakeholders are assigned a rank against each criteria. They are ranked on the basis of some criteria like Influence, Interest, and Impact. Business uses a high-medium-low or number rating system for such criteria.
Managing stakeholders often turns into a nerve-wracking task. As the number of major stakeholders elevates, it adds more stress to the project and influences the project’s complexity level. The number of stakeholders, their investment level, degree of acceptance, and rejection often influences project complexity.
Now you know you are a stakeholder. There’s isn’t necessary you need to invest money to be a stakeholder. And you even might have learned how to manage stakeholders. Don’t fret; it isn’t complex as it sounds. Just remember each stakeholder needs to be engaged and managed with. Keeping them satisfied is the key to success. In this context, we have covered all aspects of how you should analyze and identify stakeholders and design an effective plan to engage with them. If you want to know more about Business management, then refer to Plan Your Business Strategy blog to learn how to design a successful business plan. Take time and plan strategies using these stakeholder management strategies to enhance your stakeholder’s experience comment below what do you think of this resource or any points we missed in the content. We would love to hear your response.