A stakeholder is, basically, a person or entity that will be impacted in some way by a proposed change. Stakeholders can represent departments, teams, organizations, customers or an individual.
Vampires? Well, given the opportunity, they'll suck the life out of you.
A stakeholder analysis enables the business analyst to identify the stakeholders impacted by the change, their level of authority in the decision making process and their level of influence to move the project in a positive or negative direction. More importantly, stakeholder analysis is the first step in building a relationship with the stakeholders and to create a plan for ongoing stakeholder management. Other advantages of a stakeholder analysis include:
- Defines the roles and responsibilities of each stakeholder.
- Clarifies what the stakeholder hopes to gain from the project.
- Identifies conflicting and competing priorities between stakeholder groups.
- Defines, confirms, expands and/or adds details to the scope of the project.
- Sets a baseline of expectations within the team.
- Establishes a level of trust among stakeholders that can be leveraged to facilitate negotiation, cooperation and agreement to assure a successful outcome.
- Identifies individuals or groups that are resistant to the change or promoters of the change and their reasoning.
So who are these stakeholders?
Types of Stakeholders
Stakeholders can be broken down into three common categories:
These are individuals identified as core decision makers, often involved throughout the entire lifecycle of the project and typically responsible for the final sign-off and approval process. For example department leads in the area of: Project Management, Product, Architecture, Design, Operations, Manufacturing, Clinical, IT, Quality Assurance, Regulatory/Policy, Security, Training, etc.
Primary stakeholders are identified as those individuals or groups directly affected by the change. These stakeholders can be involved throughout the entire lifecycle or during various phases of the project. For example direct users of an: application, process change or a new business initiative may be involved in requirements elicitation, user acceptance testing and training.
Secondary stakeholders can be classified as individuals or organizations indirectly affected by the change. For example: consumers, competitors, board members, stockholders, etc.
Primary and Secondary Stakeholders can also be Key Stakeholders.
How to Conduct a Stakeholder Analysis
A stakeholder analysis should be conducted during the initial phase of a project and updated periodically or as needed. There are many ways to conduct a stakeholder analysis based on size of the project, various tools available and individual preference. This is the method I have found to be the most adaptable.
Step 1: Identify the Internal Key Stakeholders
- Obtain an organizational chart (also known as an Org Chart) to ensure all departments/groups are represented, names and titles are correct and hierarchical relationships can be easily identified.
- From this Org Chart identify the internal key stakeholders, e.g. the decision makers whose department/groups will be affected by the project.
- Try to keep this group as small as possible, one or two people per represented area.
Step 2: Identify the External Key Stakeholders
- External Key Stakeholders are those outside of your organization that are affected by the proposed change, such as a customer/client that has a joint venture with your organization to customize a licensed product. The customer may have a mirror image of Key Stakeholders on their side that will also need to be identified, analyzed and on-boarded.
- Again the smaller the group the better - or you risk creating a logistical nightmare.
Step 3: Conduct One-on-One Interviews
- Given the privacy, stakeholders may entrust you with information that they may not divulge in a group setting. Yes - this may mean some complaining - let them vent. Venting to an empathetic business analyst allows the stakeholder to feel that they are being heard and may provide useful information, such as underlying problems, organizational politics, etc.
- Anything that increases trust and strengthens the relationship between you and the stakeholder increases your ability, as the BA, to influence business decisions and manage conflicts.
- Key Stakeholders are busy people - limit these initial meetings to 30-40 minutes. That means planning an informal meeting that will allow you to collect as much information as possible, while keeping your eyes and ears open to the more subtle changes in body language and tone.
Focus of One-on-One Interviews
- The Meet and Greet - Whether you're new to the organization/project or have been there forever, a little socialization benefits everyone and acts as a break in the stakeholders previous thought pattern, enabling you to redirect their focus.
- Problem vs. Opportunity - Have the stakeholder give you a high level overview of what they see as the challenges/issues, pain points, or opportunities that are driving this project.
- Past vs. Future - In the past what had been done, if anything, to address the problem or opportunity? What was the outcome? Does the stakeholder have an idea or concept of what they would like to see going forward? How do they think this concept will change how they operate in the future?
- Level of Involvement - Define with the Key Stakeholder their level of involvement during the project. You can use a RACI matrix to identify if they will be: Responsible, Accountable, Supportive, Consulted, Informed or any combination of these levels.
- At this point the most important part of the RACI matrix is to identify if the Key Stakeholder will be "Accountable" for final approval/sign-off of the requirements/technical specification for their area. If they are not, have them identify which other Key Stakeholder or Primary Stakeholder will be accountable.
- Identify Primary Stakeholders - The Key Stakeholders should identify the Primary Stakeholders, e.g. subject matter experts (SMEs) and/or actual users who will represent their area during various stages of the project - mainly elicitation/requirements gathering.
- Ongoing Communication - Identify what type of communication method and frequency the Key Stakeholder expects. I suggest that you present a limited set of methods and frequencies for the stakeholder to select from.
As you're conducting these interviews you'll begin to get a feel for those stakeholders that will have a positive vs. negative impact on the project. It's also okay for you, as a BA, to have a healthy level of skepticism. Many stakeholders will be on their best behavior or present a false sense of harmony. During future meetings, keep an eye on these stakeholders. At the first sign of transfiguration, you'll need a stakeholder management plan - before they suck the life out of the project!
Want more? Check out Part Two!