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Blog post 04 Feb 2021

Successful Project Manager II: The Importance of Stakeholders

Successful Project Manager II: The Importance of Stakeholders

In this series, we will take a closer look at the role and responsibilities of the project manager. Where exactly does a project manager fit in a company, and what impact can one’s role make on the company’s performance? In this part, we will focus on stakeholders: who are they and their role in the project?

Stakeholders are people who have, in one way or another, an interest in and is impacted, whether positively or negatively, by the current project. An individual or an organization can represent stakeholders. They hold an important role in the project as they greatly influence it, and no project can succeed without their presence and input.

The keyword when it comes to stakeholders is engagement. A project manager should work towards the best engagement of stakeholders possible. A good project manager will thus strive to work with stakeholders to ensure healthy relationships and good communication. Let’s look at some practical ways this can be done.

Getting to Know Your Stakeholders

First of all, it is helpful to identify the stakeholders. One way to do so is by dividing them into these two groups:

  • Internal stakeholders
  • External stakeholders

Internal stakeholders are those individuals and groups who hold a position within a company. They include the company owners and managers, but the company employees are also important.

On the other hand, there are external stakeholders. While they do not take part in the company, their presence and influence are the two main aspects of the project success. The external stakeholder group is very diverse and includes customers and suppliers and creditors, and shareholders. Depending on the size and scope of the project, there may be other stakeholders involved, such as governmental agencies and non-profit societies.

The Power of The Stakeholders

Whether they are internal or external, it is important to build good relationships with the stakeholders. This may be a challenging task for a project manager, especially when it comes to more complex projects. Certainly, not all the stakeholders will be involved in the project in the same way, and some may not even want to be involved. Some stakeholders may be resistant to support the project, while other stakeholders may not even be aware of the details of the project. Other stakeholders may hold neutral ground while still another group may be eager to participate.

While the project manager’s goal is to involve all stakeholders and persuade them to favour the project, it is important to determine the power and influence of different stakeholder groups. A simple tool can be used here – a power and interest grid.

This grid is divided into four quadrants based on their vertical and horizontal axis position, representing power and interest. Before placing any stakeholder in one of the four quadrants, you should try to answer the two key questions:

  • How much influence does the stakeholder hold?
  • How much interest does the stakeholder have in the project?

Eventually, all stakeholders should fall into one of the four categories:

Low power, low interest

Some stakeholders hold little power and don’t show significant interest in the project. They are important, yet they will not be at the centre of the project manager’s attention. However, they should not be overlooked and dismissed. The best strategy is to monitor them. The goal here is to prevent the low power, low-interest stakeholders from taking a negative stance towards the project. That is why regularly reaching out is a good idea with these stakeholders.

Low power, high interest

Some stakeholders may not have as much power and influence on the project, yet they are very interested. Keeping them informed will ensure that they do not lose their interest and remain positive towards the project. Again, regular communication will keep them engaged and interested.

High power, low interest

High-power yet low-interest stakeholders are very important for the project. They may influence a lot, and, unfortunately, not pleasing them may result in delays or even failure of the project. The best way to engage with them is to ensure that they are satisfied. Satisfying the high-power stakeholders can lead to their increased interest in the project.

High power, high interest

This is the most important group of stakeholders. Besides holding power, they are already interested in the project, and they may be of a great asset to it. It only makes sense to engage these stakeholders in the process and consult with them regularly. While none of the four stakeholder groups should be overlooked, the focus on the project manager should be on this particular group, devoting time and attention to building a stronger relationship.

Once stakeholders are identified and placed in one of the groups, a stakeholder register can be developed. It contains information on stakeholders and helps the project manager strategically manage the various stakeholder groups. As a first step, initial contact with each stakeholder should be established to create the relationship and provide the initial information on the project. On the other hand, stakeholders may wish to express their opinions and views on the project and the process of its completion. They will express the ways they wish to be contacted and which information is of interest to them. The dynamics of the project will require regular communication. Therefore it is crucial to start right.


PMBOK© Guide: A Guide to the Project Management Body of Knowledge. 6th Edition. Project Management Institute, 2017.

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