Welcome to the MarketDeveloperLtd: A systematic approach to the stakeholders management

A Systematic Approach to Stakeholder Management

By Simon Davis

What is a Stakeholder?

At its broadest a Stakeholder is any individual or entity that has an effect on, or a stake in, an organisation. Therefore managers and the company's owners are clearly Stakeholders, but so are customers; people living in the vicinity of a factory; lobby groups; local government and many other individuals and groups.

Stakeholders and Stakeholder management also exist at a project-by-project level.

What is Stakeholder Management?

Stakeholder management is critical to innovation and marketing in business and for companies and organisations operating in a political environment their long-term survival may depend on it. The key objective of stakeholder management is to identify stakeholders, measure their relative and absolute influence on organisational or project performance and on each other and then to effectively manage the linkages between these influential relationships. It is an important discipline that successful organisations use to win, measure and manage support. It helps them ensure that they and their projects succeed where others fail.

A Systematic Approach

1. Identification of Stakeholders

Some organisations use desk research, others brainstorm internally, while some have their Stakeholders defined for them statutorily. These are some of the Stakeholders that can be identified during the process:

Shareholders
Strategic Partners
User Groups
Customers
Market Analysts

Government
Local Government
Pressure Groups
Community Groups
The public

This information then deeds to be rationally stored in a database management system using a hierarchy that exists at at least two levels, one for organisations and one for individuals in organisations.

2. Understanding your Stakeholders

These individuals and organisations can have huge influence to bring to bear on you and your business, so it is incumbent on you to understand as much as you can about these individuals and groups. This should be handled in a planned and rational way through research, phone or paper based surveying, using focus groups, etc. Your data management system should be flexible enough to hold this type of information and grow with the depth of information you collect.

You also need to collect more 'organic' data - non-quantifiable material that relates to preferences, interests and drivers outside the directly relevant environment - as this information adds 'richness' to the rational information collected and it can be a prime differentiator. It is also more personal and should be collected and held appropriately.

Often the difficulty with this information is not in collecting it, but storing it in away that is useful to you. Most data management systems will allow you to collect this in 'note' or 'memo' format, but problems frequently arise when it comes to using it. It will not be possible to select or extract on the basis of this organic information and impossible to use this to profile or model as it not 'discreet' information that a computerised system will allow you to identify.

3. Prioritising your Stakeholders Having followed the two previous steps, you should have a large list of people in organisations that either affect your work or are affected by it. You will also have the basis, with the data collected, to run a rational analysis of those individuals. The next step is to map and then, through the mapping process, prioritise those organisations and individuals.

Mapping Organisations

Organisations are relatively easier to map because, paradoxically, they are more difficult to analyse rationally in this circumstance. The essence of this part of the project is to determine those areas where an organisation has impact and influence over your organisation and then to develop a scoring system that has application across as many of your Stakeholders as possible. The data collection then revolves around those 'levers' that a Stakeholder may have and the means of scoring you have decided upon.

Example:

A supermarket group wishes to make a planning application for a new Super Store.

	Decision Maker	Political influence	Possession of informed knowledge	Ability to influence decision	Financial / emotional interest	Commitment to the cause	Total
Local Authority Planning Dept	10	0	8	10	3	10	41
Local Council	0	7	5	8	6	3	29
Local Residents	0	6	3	8	10	8	35
Local Customers	0	3	3	4	8	5	23
Trade Bodies	0	2	6	3	1	4	16
Pressure Groups	0	4	4	4	1	6	19
Local Press	0	6	6	8	6	8	34

Mapping this onto an Influence Map is then a straightforward exercise. The simplest way to map them is to visualise them as a set of concentric circles where the inner circle has the most influence and the extent of influence gradually declines further from the centre, a so called 'Influence Map'. Please see Fig 1 below.

Key questions that can help you understand your stakeholders are:

What financial or emotional interest do they have in the outcome? Is it positive or negative?
What motivates them?
What information do they want from you?
How do they want to receive information from you? What is the best way of communicating your message to them?
What is their current opinion of you? Is it based on fact or rumour?
Who influences their opinions generally, and who influences their opinion of you? Should influencers therefore become stakeholders in their own right (Local Press are a good example in the case above)?
If they are not likely to be positive, what will win them around to support you?
If they are resolutely negative, how will you manage their opposition?
Who else might be influenced by their opinions? Do these people become stakeholders in their own right?

A very good way of answering these questions is to talk to your stakeholders directly - people are often quite open about their views, and asking people's opinions is often the first step in building a successful relationship with them. Be thoughtful and log the answers systematically as they can provide extremely deep insights later. Continued on the Next Page

Simon Davis is Managing Director of MarketDeveloper Ltd, one of the UK's leading producers of hosted Marketing, Sales and CRM solutions. MarketDeveloper Ltd were amongst the first to market with 'evaluate' in 2000 and the current version is marketed under the MarketDeveloper brand name.

All trademarks, trade names, logos, and service marks referenced herein belong to their respective owners.

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