Stakeholder Management as an Element of the Six Interdependencies

4 min.

Summary


In order to identify the right stakeholders of the project, the environment analysis is carried out as a precursor. The social environment factors are included in the stakeholder analysis and it is recommended to consider them according to the following dimensions: Power and conflict potential. The objective of the stakeholder analysis is to group the stakeholders in the individual quadrants of a 4-quadrant portfolio in order to represent a corresponding number of stakeholder strategies. If I consolidate the stakeholders in a stakeholder portfolio quadrant, I have the chance to plan a consolidated measure using the common strategy of the quadrant. Various sources of error in the preparation of the stakeholder analysis are pointed out.

What is a stakeholder?

As already mentioned in my “Six Interdependencies“, the consideration of stakeholders is an essential component for project success. Stakeholders are individuals, groups of people, organizations or the entirety of all those who are involved in the project, directly or indirectly affected by it or have a justified interest in it.

Environmental analysis as a basis for stakeholder analysis

In order to identify the right stakeholders of the project, the environment analysis is carried out as a precursor. The project environment analysis is a systematic, forward-looking consideration, observation and analysis of the positive (supporting) and negative (disruptive) influences of the project environment on the project, to be introduced as early as the initiation phase. A distinction is made between the social and factual environmental factors. A further distinction can be made between project-internal, project-external or company-internal or company-external factors. A differentiation exclusively between internal and external factors is not specific enough. Opportunities and risks in the further course of the project planning can be determined from the objective environmental factors and interfaces of the project can be made conscious.

Stakeholder analysis and its determination

The social environment factors are included in the stakeholder analysis and it is recommended to consider them according to the following dimensions: Power and conflict potential. Other dimensions such as influence, interest can be qualitative but not necessarily clearly grouping dimensions. Interest and influence can be positive, negative, high or low. The advantage of power and conflict potential is that they can be high and low, but not positive or negative at the same time. Why do we only want to record high and low values of the two dimensions and not e.g. values with very high, very low etc.? Low conflict potential stands for (potential or actual) promoters and high conflict potential for (potential or actual) opponents. In practice, a constant consideration of the (potential) opponents and promoters is necessary anyway.

The objective of stakeholder analysis is to group the stakeholders in the individual quadrants of a 4-quandrant portfolio in order to subsequently reflect a corresponding number of stakeholder strategies in it. It therefore makes sense to group the stakeholders in a portfolio into high and low power, high and low conflict potential. A direct allocation of stakeholder strategies can then take place directly.

Stakeholder strategies and their allocation in the portfolio

The following strategies can be included in a stakeholder portfolio:

  • Participative strategy based on participation and active involvement, communication and information of the project environment actors, e.g. joint decision making workshops,
  • discursive strategy, which (mostly reactive) is geared to the objective analysis of the project environment, e.g. by means of conflict resolution instruments,
  • repressive strategies characterised by the use of organisational, informational or factual power, e.g. management requirements or selective information.

For the fourth quadrant, it is recommended to provide for purely informational measures, which, however, do not represent a real strategy and are therefore not referred to as such.

A meaningful stakeholder portfolio thus looks as follows:

Stakeholder-Portfolio

Stakeholder strategies – why is that?

Why do I want to look at strategies and not just measures for each stakeholder? Measures per stakeholder are time-consuming and costly. If I now plan individual measures for each stakeholder, I have a complex bundle of measures. If, on the other hand, I consolidate the stakeholders in a stakeholder portfolio quadrant, I have the opportunity to plan a consolidated measure using the joint strategy of the quadrant.

Typical sources of error in stakeholder analysis

If stakeholder strategies are mapped on the basis of dimensions other than power and conflict potential, there is a danger that the stakeholders will not be clearly classified. If, for example, the stakeholder’s interest is highlighted instead of the power dimension, secretly positive, negative, high and low groupings are possible and therefore multiple allocation to portfolio quadrants is likely. I have observed this in many misguided stakeholder analyses.

Another problem can be the failure to conduct a continuous stakeholder analysis. You should always look at stakeholders anew. Shifts in power in a company can change the dimension of power, but above all the characteristics of the dimension of conflict potential can change again and again. The stakeholder’s potential for conflict with the project can change as a result of changes in attitudes towards the project as a result of project developments.

A renunciation of the combined indication of names or roles already in the environment analysis and then also in the transfer into the stakeholder analysis can lead to a generalization and to an overlooking of important characteristics. Mr. Mayer-Schulze can be a pedantic, conflict-laden comrade-in-arms, but his role as a user does not necessarily suggest this.

Grouped environmental factors such as “steering committee” instead of the performance of all individual steering committee members may lead to lump sums and thus the overlooking of specific interests and influences.

From the “Triple Constraints” to the “Six Interdependencies”

3 min.

Summary

The project objectives, the Magic Triangle, Triple Constraint or also called Objectives Triangle is a consolidated representation of the project objectives. In the course of time, a further target variable has been added to represent stakeholder satisfaction, especially client satisfaction. The project is carried out in the context of organisations. At least one organization provides resources in the form of project personnel and material resources. A simple resource planning of the project optimized for the project isolated from the context is not target-oriented. Further each project has not only positive aspects, but causes also a damage. These are the “six interdependencies” which also apply to agile project management approaches.

Origin and Development

The project objective variables, the magic triangle, triple constraint or also called objectives triangle is a consolidated representation of the project objectives on the basis of the measurement variables

  • scope or service,
  • cost (hours or person days and costs) and
  • time (duration and dates).

In the course of time, a further target variable has been added, which is to represent stakeholder satisfaction, especially customer satisfaction. An extension to the magic square did not take place, but was seen as an extension of the magic triangle.

A magic square in connection with project management was mistakenly included in the literature, in which the quality was recorded separately. However, we must clearly distance ourselves from this, since quality is inherently anchored in the aforementioned goals.

We can therefore state that there are at least four indicators for the success of a project: scope, time, cost and stakeholder satisfaction.

Project success in the context of the environment

The project will be carried out in the context of organisations. At least one organisation provides resources in the form of project personnel and material resources. These are also limited and it is a component of the planning duties and thus criterion of the project success, how effectively the project personnel and how careful/limited the project resources are used for the entire organization. Because the project personnel is often entrusted with other tasks in the line and / or the coworkers are just as urgently looked for in other projects. The material resources such as an excavator become just as important for the course of the project on another construction site, for example. A simple resource planning of the project optimized for the project isolated from the context is not goal-prominent. The optimization needs which the project director, the project portfolio manager or the specialist departments specify for project resources are not only a one-sided process. Perhaps the consideration of this interdependence resource optimization in project success would also nip in the bud the thought construct of “thinking of project members only as inputs”.

Every project not only has positive aspects, but also causes damage. For example, an implementation of software may lead to job losses. Or an environmental protection project for the creation of a new nature reserve leads to the loss of a farmer’s arable land. This causes damage to the farmer, even if he is certainly compensated for it. So here we have a clear contribution to the project success in this case with a negative sign. We cannot simply deduct this negative contribution from the performance. Here we would make it too easy for ourselves, because the service is the desired dimension of the client and automatically does not take the damage into account.

In addition to scope, time, cost and stakeholder satisfaction, we have now established two further success criteria such as resource optimization and project damage.

We have thus outlined the “Six Interdependencies”.

Six Interdependencies

Agility and the reflection of the Six Interdependencies

Now you might think the magic triangle was never relevant for me as an agile product owner anyway, because the performance is never relevant due to “fix” number of story points that can be processed in a sprint. This is deceptive and not really true, because by prioritizing the backlog the most important performance is of course defined as “part” of the project. Reprioritizing, adding or removing stories at the start of each sprint deliberately changes the performance of the project. So the six interdependencies are also likely to be relevant in agile practice.