Stakeholder management is an important process for governments and organizations all over the world. In this guide, we share stakeholder management definitions, why it matters, processes, best practices, and more.
Whether you’re just starting to take a strategic approach with managing stakeholders or you’re an executive or consultant with decades of experience, we hope you’ll come away with plenty of value in the form of clarity, ideas, and resources you can explore further.
Stakeholder management is defined as the process by which you organize, monitor, and improve your relationships with your stakeholders. Usually this involves identifying stakeholders, analyzing their needs and expectations, and then planning and implementing various tasks to engage with them. This will allow you to coordinate your interactions and assess the quality of your relationships so that you can achieve an outcome, legal requirement, or strategic benefit.
You might also hear stakeholder management referred to as stakeholder engagement, community engagement, public consultation, civic engagement, public participation, and several other terms. There are some subtle differences between these terms, how they’re used, and preferences in different jurisdictions, but they each have very similar processes.
Learn more about what stakeholder management is.
|What’s a Stakeholder?
Stakeholder refers to any people or groups who are impacted by a project, initiative, policy or organization.
Read more about what stakeholder means.
Sometimes you’ll come across other definitions of stakeholder management that focus on the idea that you can create a plan to manage your stakeholders in order to get them to do what you want. But this is a common misconception.
Although stakeholder management can help you achieve various legal and strategic objectives, the stakeholder management process isn’t designed to influence or control people. It isn’t marketing and it isn’t public relations.
So, in this guide, we’re not going to show you how to herd sheep, put them in neat little pens, and pretend they’re heading in the direction you want. But we are going to show you how you can achieve objectives like meeting your legal requirements and gaining strategic advantages through stakeholder management.
Stakeholder management is an important process for many organizations and projects, and has a range of benefits and use cases. For instance:
Gain a competitive advantage – Any organization can gain a competitive advantage by more effectively understanding their stakeholders, identifying opportunities, and uncovering potential risks
So, what does a deliberate, strategic approach to stakeholder management actually look like? Generally, you could break it down into four main steps:
The key to a successful stakeholder management program is to start with a good understanding of your stakeholders. And make sure you are testing and refining that understanding throughout the process.
After identifying stakeholders, begin your stakeholder analysis by considering and making note of:
2. Stakeholder Knowledge Base Chart
3. Power/Interest Grid
4. Power-Predictability Matrix
5. Stakeholder Relationship Mapping
6. Stakeholder Mapping Spreadsheets
To continue your stakeholder analysis, it’s helpful to ‘map’ or visualize your stakeholders in relation to other key stakeholders and key criteria. This will enable you to strategize how you will prioritize and approach either individual, organization, or group of stakeholders.
Stakeholder mapping is a term often used to describe the process of assigning values that shape priorities and strategies for each stakeholder, based on their ranking against some set criteria. Sometimes stakeholders are simply assigned a rank (of low-medium-high or 1-5) against each criteria. Often they are plotted on a matrix to provide a visual depiction of the range of stakeholders in your program. After you have ranked your stakeholders or plotted them on these matrices, you next need to consider how this information will influence your stakeholder management plan and strategy.
There are a number of standard frameworks used for stakeholder mapping:
We cover these frameworks and methods in detail in our blog on stakeholder mapping.
At Simply Stakeholders, we take a multi-dimensional approach to stakeholder mapping inside our stakeholder software.
Some of the ‘industry standard’ grids are a bit dated and don’t take into account shifting power relationships and stakeholder expectations (especially with easy access to social media and the risk-averse nature of governments when it comes to political damage). It’s important to take this into account when selecting a framework or model to ensure that you can fully understand your stakeholders and ensure your strategy caters to all their needs.
Our approach to stakeholder mapping includes:
The level of influence a stakeholder has over the project
The level of interest a stakeholder has on the project.
The level of impact the stakeholder has on the project.
Depending on how relevant other mapping fields are for your organization, these can also be used to measure the level of influence, interest, and impact your project has on the stakeholder:
How important is it to engage with this stakeholder?
What is their current sentiment towards your project?
How much time and energy are you expending to engage with the stakeholder?
Importantly, our software also tracks how these stakeholder mapping values change over time. If you’d like to know more about the Simply Stakeholders approach to stakeholder mapping, get in touch with one of our team.
A stakeholder management plan is a document that outlines appropriate management strategies to effectively engage stakeholders throughout the lifecycle of the project, based on the analysis of their needs, interests, and potential impact on the project’s success.
Your stakeholder management plan will include some of the information you’ve gathered from step 1 & 2 in the process, as you identified, analyzed, and organized your stakeholders. But before you jump into creating your plan, start by asking the following questions:
It’s important to be strategic and clear about who you are engaging with (and why) before you get too far into the process. This will not only help to save time and money, but also help you manage expectations and gain trust.
Here are 5 components that should make up your stakeholder management plan:
1. Identify Stakeholders
Remember — not all stakeholders in the same group will necessarily have unified opinions or priorities.
2. Analyze Stakeholders
Include any other information to help better understand stakeholder needs, priorities, and issues.
3. Strategize and Prioritize
Consider the most appropriate ways to engage with each group.
4. Assign Responsibilities
Consider the roles and requirements for stakeholder management.
5. Monitor and Report
Consider who you should report to, when you should report, and what you should report on.
We have quite a few resources that can help you put together your stakeholder management plan, including:
Or jump straight into our online tool to create your stakeholder management plan in just 15 minutes:
|Online Tool: Create a Stakeholder Management Plan|
Once your stakeholder management plan is in place and you’ve gained acceptance from your colleagues, executive team, and other relevant stakeholders in your organization, it’s time to implement it.
This means putting in place the tools, communications, activities, and other strategies and resources you’ve identified to manage your stakeholders. Plus, ensuring that the other responsible people implement their assigned activities and tasks.
Implementing your current plan is just the beginning. Throughout the implementation, you should monitor your stakeholders to see how they respond to the strategies and check whether you’re meeting the objectives of your plan, project, and organization. Regular reports are important so that you can keep the relevant people in the loop — and track how your plan is progressing.
Monitoring and reporting will often reveal opportunities to improve your processes — new insights into stakeholders, feedback, changing expectations, emerging issues, and changing sentiments. As you learn new things about your stakeholders, use this as an opportunity to adjust your stakeholder management strategies.
We’ve already covered some basic processes and plans you can follow to get started with stakeholder management. But let’s dive a little deeper into some best practices and more advanced tips you can apply to help you achieve the best possible outcomes.
With increasing legislation and concerns around privacy and the use of personal data, it’s more important than ever to have clear, well documented processes for your stakeholder management.
For instance, if you are working in or providing services to the European Union and the United Kingdom, you must take particular note of the GDPR requirements that came into play in May 2018. Most other countries have also increasingly tightened requirements for:
After identifying your stakeholders, review your stakeholder lists to ensure they genuinely represent the whole range of stakeholders. Your needs assessments and engagement programs are all dependent on you having up-to-date and representative stakeholder lists, so make a note to check for comprehensiveness on a regular basis.
Honesty is the best policy with stakeholder management! Be honest about why and how you gather information from stakeholders, including social media tracking (going above and beyond the legislated requirements). Be transparent about what you are collecting, why, and what you plan to use the data for.
After analyzing and mapping your stakeholders, segment them into lists to help you provide a more relevant, tailored stakeholder experience. You could slice your list by a variety of attributes, including location, demographics, industry, interest, needs, influence, and impact.
Another benefit of this is that you can gain insights into how specific stakeholder groups are responding to your communication and activities. And you can make sure you’re reaching the right people with the right message at the right time.
Evaluation is an important part of stakeholder management but too many organizations don’t do this well. In particular, you should evaluate whether your plan was successful based on pre-defined measures of success. We talk about this inside our eBook on evaluating stakeholder engagement and public consultation and our webinar on how to evaluate your stakeholder engagement.
Regularly audit your data management processes to ensure they’re appropriate, compliant, and efficient. Check that the metrics you’re gathering are fair — to ensure that your conclusions and recommendations accurately represent stakeholder views and requirements.
Another issue to consider is whether you’re keeping your stakeholder system up-to-date. Encourage your team to regularly add new stakeholders to your lists and ensure all interactions are automatically or manually added to the system. The sooner data is added, the less likely it’ll be missed or forgotten.
It’s also a good idea to run maintenance on your data to clean it up. Look for duplicate stakeholder records and merge them. Or (ideally) use a stakeholder management system that allows for sophisticated cross-project stakeholder sharing to minimize stakeholder list duplication and keep your data squeaky clean.
Stakeholder management is a huge task — and one best shared with your team. So, make sure that your contact list is in a format that’s easy to share, and allows multiple to work on it simultaneously. The problem that so often occurs with spreadsheets is that you end up having issues with version control and information spread across multiple places. Once you are working inside an SRM like Simply Stakeholders, you can be confident that all users with permission have access to the latest and most up-to-date list.
Of course, be aware of privacy and other legislation around the use of personal information —make sure you are still compliant with the legislation in your country.
From the start of your stakeholder management process, consider what information you might need from stakeholders in future in order to contact them and gather meaningful insights. For example, if you have a signup form on your website, ensure you include all the fields that are important to track. For example, a postcode or area code can allow you to tailor your insights and communication to very specific locations.
This will save you time gathering information manually, and give you richer information on each stakeholder — above and beyond just their name and email address.
Of course you do need to balance this against form best practices, ensuring that you don’t end up with a form that’s so long that most stakeholders won’t complete it.
Grievance and complaints handling is an important part of stakeholder management in most organizations. A well-functioning grievance mechanism provides a transparent, credible, and fair process to all parties. It enhances outcomes and gives people the satisfaction that their complaints have been heard, even if the outcome is less than optimal.
A good complaint handling process helps build trust as part of the broader community relations activities and contributes to the overall success of the company’s social performance.
Watch our webinar on how to handle grievances.
When creating your stakeholder management plan and deciding on what activities you should include, think outside the box — and consider new, tech-enabled methods that may not have been previously available. Explore case studies, academic papers, new platforms, and data capabilities to see what’s possible!
One final, important element to stakeholder management that we’ve touched on already is your software or tools. There’s a lot that goes into the stakeholder management process — to do it properly (especially at scale or over a long period of time), you really need the appropriate tools for the task.
Typically, organizations use one of the following tools:
Firstly, if you haven’t already, it really is time to leave the spreadsheets behind. They don’t offer enough collaborative features (including version control), automations/integrations, analysis/tracking, and reporting functionality. Plus, they’re difficult to offer the level of security and privacy that today’s organizations need when handling people’s data.
Now, if you’re trying to decide between a CRM and SRM, it can be tricky if you’re new to these types of software. At first glance, they might even look pretty similar.
So, what are the similarities and differences between the two? When looking at most CRM products on the market from a stakeholder management perspective, compared with Simply Stakeholders, here’s what you’ll find:
|CRM (Customer Relationship Manager)
Designed to manage and track the sales process
|SRM (Stakeholder Relationship Manager)
Designed to manage and track stakeholder relationships and issues
✅ Collaboration tools
✅ Reporting and analytics
✅ API Integrations
❌ Multiple Projects
❌ Stakeholder mapping
❌ AI-driven sentiment insights
❌ Project history
❌ Simplified data re-use
✅ Collaboration tools
✅ Multiple Projects
✅ Reporting and analytics
✅ API Integrations
✅ Stakeholder mapping
✅ AI-driven sentiment insights
✅ Project history
✅ Simplified data re-use
While they have some core functionalities in common, you’ll soon find that a CRM falls short on managing complex projects and stakeholders, and lacks important features for analysis and tracking. So, if you’re serious about managing your stakeholders, make sure you trial purpose-built stakeholder software.
Read more about the difference between a CRM vs SRM. We’ve also covered the reasons CRMs might not be working for your project or organization.
Exploring software to support your stakeholder management process? When it comes to stakeholder software, Simply Stakeholders is a great choice for organizations of all sizes. It offers a user-friendly interface, one place for all your stakeholder interactions, stakeholder mapping, and cool features like AI-driven analysis.
Check out a demo of Simply Stakeholders here:
We’ve covered a lot of information here, but if you’d like to dive deeper into a specific aspect of stakeholder management (or you prefer your info in another format), you might like to explore these related resources:
We’re always happy to share our knowledge and expertise. Get in touch and let us know what you think of the resources on this page. And be sure to subscribe to our email list to make sure you don’t miss future articles.
If you are interested in some advice, having us create more useful resources, or want to find out about the software we created to support stakeholder management, please reach out to our team.