Monday, July 7, 2014

Stakeholder Analysis


STAKEHOLDER ANALYSIS
by Antonio C. Antonio
December 3, 2013

Stakeholder analysis is part of Stakeholder Management which is supportive of any organizational purpose and objective in establishing positive relationship with the internal and external environments of the organization.  Stakeholder management is a process that establishes control through a planning methodology with the aim that is beneficial to all stakeholders. 

Stakeholder management follows the following process:

1.     Stakeholder Identification – Considers all potential stakeholders that will be affected by and could potentially affect a project.  Provides a short list of all interested and interest individuals and groups in both internal and external environments of the organization.  A stakeholder map or matrix will be a helpful tool in identifying concerned stakeholders.  Stakeholder identification could best be done using brainstorming techniques procedures, with a representative group of all stakeholders.  Membership to brainstorming teams should be based on the member’s intimate knowledge of the stakeholders they represent.  It is also helpful to create stakeholder categories such as: management; customers, media, community, finance, etc.
2.     Stakeholder Analysis (which will be discussed in the latter part of this report).
3.     Stakeholder Matrix – A tabular management tool which classifies stakeholders according to the degree of influence or impact to the project.  Please see Table 1 - Stakeholder Matrix.
4.     Stakeholder Engagement – Are the formal and informal face-to-face series of meetings between concerned stakeholders.  These interactions are opportunities aimed at establishing expectations among stakeholders as it delineates problems, create solutions and establishes the roles and responsibilities of individual stakeholders.  A Stakeholder Agreement is normally the result of stakeholder engagements that gives details of the project, the importance of the initiative and the objectives and purposes of the project which everyone concerned is expected to abide by.  This agreement is often signed by all the stakeholders or a representative component representing all stakeholders.
5.     Information Dissemination – A critical aspect of stakeholder management where trust and confident is developed depending on the quality, accuracy and truthfulness of the information being shared by and to all stakeholders.

Stakeholder analysis is a management tool used to identify and assess people, groups of people, or organizations that should have critical and significant roles in the success of a planned project or activity.  It is a long-range technique to measure and anticipate the kind of influence (be it positive or negative) that these individuals or groups will have on the project.  It is aimed at the development of situational strategies and fitting such strategies to guarantee the flow of support from these individuals or groups.  Stakeholders analysis can best be used in the planning and organizing stages… perhaps, also critical in the pre-planning or project conceptualization stage.  It could also be used as a “mid-term” tool to validate the impact of the participation of people or groups in the prosecution of the project although it should, at best, be more effective in the early stage of the project.  More importantly, it could be used when the project halts to a stop because of opposition to the project or non-cooperation from a good number of stakeholders.

Here are some additional definitions and descriptions of Stakeholder Analysis:

·         Refers to the action or process of analyzing attitudes of stakeholders towards a certain project.
·         Is a key part of stakeholder management.
·         The process of identifying the individuals or groups that are likely to affect or be affected by a proposed action, and sorting them according to their impact on the action and the impact the action will have on them.
·         Can best be used in conflict resolution, project management and business administration.

To better understand what stakeholder analysis is all about, let’s go back to the basics.  Who are the stakeholders?  A stakeholder is:

·         Someone who has something to lose or gain with the failure or success of a planned project;
·         Anyone who could make use of, develop, or have an impact on any aspect of the project;  Those who have a stake in the project; and,
·         They could be either direct (those whose actions can directly impact on the project and are directly involved) or indirect stakeholders (those who have political power to influence the project or those who are not directly involved but are interested in the outcome of the project).

Assessing the stakeholder/s could be summarized in a tool called a “interest-power” grid which classifies stakeholders into groups depending on how much attention is required for each particular group.

There are many ways to gather information such as surveys, interviews and focus groups or brainstorming groups.  In the conduct of brainstorming activities, the Stakeholder Matrix could be used as the basic tool in assessing individual stakeholder:

·         For Column No. 1 – Name of Stakeholder: Identify and list all the people, groups and institutions that will affect or be affected by the project.
·         For Column No. 2 – Stakeholder Interest/s in the Project: Identify and list the specific interest/s of these stakeholders.  Issues to be considered here are (a) the project’s benefit/s to the individual stakeholder, (b) the changes that the project might require the stakeholder to make, and (c) the activities that might cause damage or conflict for the stakeholders.
·         For Column No. 3 – Assessment of Impact:  This column should ask the question: “How important is the interest of the stakeholder/s to the success of the project?”  Issues to be considered here are (a) the role the stakeholder must play to influence the success of the project and (b) the potential impact if the stakeholder/s have negative response/s to the project.  Values such as A (important), B (fairly important) and C (not important) could be used.
·         For Column No. 4 – Potential Strategies for Obtaining Support or Reducing Obstacles:  This column should be used to identify and list the kinds of things that will guarantee the stakeholder’s/s’ cooperation and support to reduce opposition to the project.

Interest-Power Grid is a very effective matrix to analyze the degree of commitment and interest a particular stakeholder has in a project.  Before filling out the grid, the following questions should be answered as guide in future decisions to be made and identifying the stakeholder/s:

·         What makes them stakeholders?
·         What is their interest in the project?
·         What does the project need from them?
·         What information about the project should be given to them?
·         What is the frequency of briefings to them?

From the manifested interest and commitment of the stakeholders, they can be classified as: (a) Monitor with minimum effort; (b) Manage closely; (c) Keep Satisfied; and, (d) Keep informed.

1.     For the “Keep Satisfied” box:  Stakeholder/s is/are high in power but low in interest.
2.     For the “Manage Closely” box:  Stakeholder/s is /are high in both power and interest.
3.     For the “Monitor” box:  Stakeholders/s is/are low in both power and interest.
4.     For the “Keep Informed” box:  Stakeholder/s is/are low in power and high in interest.

A Stakeholder Report can be made out of the information collected from the two tables.  Ideally, this will have to communicate to all concerned stakeholders.  The frequency of reports should be as often as needed although regular (monthly, quarterly, semi-annually and yearly) will be ideal.  These reports should contain: (a) main issues and concerns; (b) update on the status of the project; and (c) pipeline plans.

Information and project updates must be tailor-made for specific audiences.  These could be disseminated in formal and informal meetings, newsletters, electronic mail, bulletin boards, posters, individual briefings, public forums or media release.  This is intended to widen the understanding and knowledge of the general public.

Information on the project (especially the conceptual framework and updates) should be communicated to the usual stakeholders.  The following are largely the stakeholder group and sub-groups:

Private Sector Stakeholders:

·         Corporations and Business Enterprises
·         Business Associations
·         Professional Organizations
·         Financial Institutions

Public Sector Stakeholders:

·         Cabinet Secretaries
·         Department Heads, Regional Directors, Provincial Heads, Municipal/City Heads
·         Congressional Representatives
·         Local Government Units
·         Judges from Regional and Municipal/City Courts
·         Military establishment
·         International bodies (UN, JICA, etc.)

Civil Society Stakeholders:

·         Media
·         Religious Groups
·         Schools
·         Advocacy and Social Movement Groups
·         Labor Unions
·         Business, Commerce and Trade Unions
·         Non-Governmental Organizations
·         International NGOs

There are three types of stakeholders: (1) The Primary Stakeholders (those ultimate affected positively or negatively) by the project; (2) Secondary Stakeholders (persons or organizations that are indirectly affected by the project) and (3) The Key Stakeholders (those who play important roles and have significant influence within the organization and the project).

Although there are still other forms of stakeholder analysis (some of which are commonly called “shareholder mapping”), none of them could claim to be accurate.  The assessment procedures may largely depend on the mindset and background of the “brainstorming” group or the personalities involved in the actual assessment of the stakeholders.  But with the many problems besetting our uplands, anything and every conceivable management tool will be worth trying.
Just my little thoughts…

References:


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