Explain the concept of ''3 Rs'' approach in stake analysis.
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Stakeholder Analysis is the first step in Stakeholder Management, an important process that successful people use to win support from others.
Managing stakeholders can help you, too, to ensure that your projects succeed where others might fail.
In this article and video, we'll look at that crucial first step – Stakeholder Analysis – in more detail. Then you can move on to our next article to plan your stakeholder communications .
Why Is Stakeholder Management Important?
As your career develops, and you become more successful, the actions that you take start to affect more and more people. And the more people you affect, the more likely it is that some of them will have significant power and influence over your work.
These people are your stakeholders. They could be strong supporters of your projects – or they could block them, so you need to identify who your stakeholders are and win them over as soon as possible.
You can do this by conducting a Stakeholder Analysis – an effective three-step process for identifying, prioritizing and understanding your stakeholders.
Click here to view a transcript of this video.
Why Use Stakeholder Analysis?
A stakeholder-based approach gives you four key benefits:
1. Getting Your Projects Into Shape
You can use the opinions of your most powerful stakeholders to help define your projects at an early stage. These stakeholders will then more likely support you, and their input can also improve the quality of your project.
2. Winning Resources
Gaining support from powerful stakeholders can help you to win more resources, such as people, time or money. This makes it more likely that your projects will be successful.
3. Building Understanding
By communicating with your stakeholders early and often, you can ensure that they fully grasp what you’re doing and understand the benefits of your project. This means that they can more actively support you when necessary.
4. Getting Ahead of the Game
Understanding your stakeholders means that you can anticipate and predict their reactions to your project as it develops. This allows you to plan actions that will more likely win their support.
How to Conduct a Stakeholder Analysis
There are three steps to follow in Stakeholder Analysis. First, identify who your stakeholders are. Next, work out their power, influence and interest, so that you know who you should focus on. Finally, develop a good understanding of the most important stakeholders, so that you know how they are likely to respond, and how you can win their support.
When you’ve completed your analysis, you can move on to use stakeholder management to work out how you’ll communicate with each stakeholder.
Let’s explore the three steps of Stakeholder Analysis in more detail:
1. Identify Your Stakeholders
Start by brainstorming who your stakeholders are. As part of this, think of all the people who are affected by your work, who have influence or power over it, or have an interest in its successful or unsuccessful conclusion.
The table below identifies some of the people who might be stakeholders in your job or in your projects:
Your boss Shareholders Government
Senior executives Alliance partners Trades associations
Your co-workers Suppliers The press
Your team Lenders Interest groups
Customers Analysts The public
Prospective customers Future recruits The community
Your family Key contributors Key advisors
Note:
Stakeholders can be both organizations and people, but ultimately you must communicate with people. So, be sure to identify the correct individual stakeholders within a stakeholder organization.
2. Prioritize Your Stakeholders
You may now have a list of people and organizations that are affected by your work. Some of these may have the power either to block that work or to advance it. Some may be interested in what you are doing, while others may not care, so you need to work out who you need to prioritize .
Adapted from Mendelow, A.L. (1981). 'Environmental Scanning - The Impact of the Stakeholder Concept,' ICIS 1981 Proceedings, 20.
Key Points
As the work you do and the projects you run become more important, you will affect more and more people. Some of these people have the power to undermine your projects and your position. Others may be strong supporters of your work.
Stakeholder Management is the process by which you identify your key stakeholders and win their support. Stakeholder Analysis is the first stage of this, where you identify and start to understand your most important stakeholders.
The first stage of this is to brainstorm who your stakeholders are. The next step is to prioritize them by power and interest, and to plot this on a Power/Interest grid. The final stage is to get an understanding of what motivates your stakeholders and how you need to win them around.