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Stakeholder Management: A PM guide to building strong relationships

Published on
May 12, 2023

You put in the work to define your sprint goals, the team provided estimates, and you have a good plan. Next, you take time to communicate that plan to "the stakeholders". And then you brace for the wheels to come off. Depending on your company size, your team structure or your role, the number of stakeholders you have to appease can range from a few people to literally the entire organization.  And getting a large group to stay the course on a plan can be extremely difficult.

In this article, you'll learn the art of communication, collaboration, and making every stakeholder feel valued, all while keeping your project on track. We'll also show you how Spinach, your AI Scrum Master, can automate the majority of your stakeholder communication, which frees up extra time and energy to practice saying a very important word in stakeholder management: "no".

What is stakeholder management?

Stakeholder management is the art of keeping everyone involved in (or impacted by) a project informed, engaged, and happy. In some organizations, your "stakeholders" could be literally everyone.

It's all about building strong relationships and high degrees of trust with the various individuals and groups who have a vested interest in the project's outcome—think clients, go-to-market functions, senior management, and even end-users.

As a team leader, your role in stakeholder management is to ensure that everyone's expectations are aligned, priorities are clear, and that communication lines are open and transparent.

This process involves identifying stakeholders, understanding their needs and concerns, and taking appropriate actions to address their interests personally. Stakeholder management is how you ensure that stakeholders are happy and supportive of your team’s work and boundaries!

Internal stakeholders vs external stakeholders

Distinguishing between the different types of stakeholders is essential for tailoring your stakeholder management approach. Internal stakeholders are those within your organization who have a direct interest in the project's success, such as project team members, senior management, and other departments. Their involvement is crucial for achieving the project's objectives and maintaining organizational alignment.

On the other hand, external stakeholders are individuals or groups outside your organization that are impacted by or have an interest in your project, like clients, suppliers, and regulatory bodies. Catering to their unique perspectives and concerns ensures a comprehensive stakeholder management plan. By engaging both internal and external stakeholders, you'll build strong relationships and drive project success.

Why is stakeholder management important?

Trust: Firstly, stakeholder management is essential in establishing favorable relationships that ensure the smooth functioning of your project. Plus, when stakeholders feel heard and involved, they'll trust you more as a team leader. And we all know trust is the cornerstone of any successful relationship. 🤝

Alignment: By understanding stakeholder priorities, you can allocate resources more efficiently and keep the project on track. No more last-minute scrambles or wasted efforts!

Morale: Engaging key stakeholders and showing appreciation for their input also boosts team morale, which leads to higher productivity.

Diverse input: Lastly, with a diverse set of perspectives from stakeholders, you'll be equipped to with the right knowledge that will benefit the project management process and everyone involved.

Benefits of effective stakeholder management

If you master the art of stakeholder management, here's are the benefits:

Better decision-making

When you engage with key stakeholders and consider their diverse perspectives, you're tapping into a wealth of knowledge and experience. This enables you to make more informed, well-rounded decisions that benefit the project management process and everyone involved. As a team leader, your decisions can significantly impact the project's trajectory, so it's essential to have all the available information at your fingertips.

Identifying and addressing potential roadblocks

Stakeholder management allows you to keep a finger on the pulse of your project. By actively engaging with stakeholders and understanding their concerns, you can identify potential roadblocks or issues before they escalate into full-blown problems. This proactive approach not only saves you precious time but also ensures that your project stays on track and within budget.

Increased trust and goodwill

We all know that trust is a fundamental building block for any relationship, and stakeholder management is no different. By keeping stakeholders informed, involved, and engaged, you demonstrate that you value their input and prioritize their needs. This fosters trust and goodwill among your stakeholders, which in turn leads to a more harmonious and collaborative working environment. When stakeholders trust you as a team leader, they'll be more likely to support your decisions and contribute to the project's success. Win-win! 🏆

Steps for developing a stakeholder management plan

Follow these six steps to develop a management plan for your project stakeholders.

1. Identifying stakeholders

First things first—identify all the key players in your project. This includes clients, team members, senior management, and any other individuals or groups with a vested interest in the project's outcome.  Groups to consider:

  • End-Users
  • Clients
  • Sales
  • Marketing
  • Customer Success
  • Other Dev Teams
  • Legal
  • Finance

Knowing who your stakeholders are is essential because it helps you tailor your communication and engagement efforts to their unique needs and concerns. Don't overlook this crucial first step; it sets the foundation for your entire stakeholder management plan.

2. Conducting a stakeholder analysis 

Now that you know who your stakeholders are, it's time to analyze them. Determine their level of influence, interest, and potential impact on the project. By effectively stakeholder mapping the key players, your team will be able to prioritize efforts and focus on the most critical stakeholders.

Understanding their motivations, needs, and expectations is also key to developing a successful stakeholder management plan.

3. Defining stakeholder objectives

With your stakeholders identified and analyzed, it's time to define their objectives. What do they want to achieve, and how does it align with your project's goals?

Understanding stakeholder objectives ensures that everyone's expectations are on the same page, paving the way for a more collaborative and successful project.

4. Developing a communication and engagement plan

Communication is the lifeblood of effective stakeholder management. Develop a plan that outlines how you'll keep stakeholders informed, engaged, and involved throughout the project. This includes setting clear team and stakeholder expectations, establishing communication channels, and defining a regular cadence for updates.

Spinach is like an AI Scrum Master that can help you automate stakeholder updates. Powered by AI, Spinach can summarize what the team has done, has left to do, and any potential blockers based on inputs from your meetings and your board. By removing the repetitive task or writing summaries, you are free to have nuanced discussions and debates require human expertise and emotional intelligence.

5. Assigning roles and responsibilities

For a stakeholder management plan to succeed, everyone needs to know their role and responsibilities. Clearly define what's expected of each stakeholder, including their involvement in decision-making processes, communication, and project execution. This clarity helps ensure that everyone is working towards the same objectives and keeps your project running like a well-oiled machine.

6. Implement plan and monitor effectiveness

Implement your stakeholder management plan and monitor its effectiveness throughout the project.  Keep an eye on stakeholder satisfaction, engagement, and alignment with project and business goals. Ask for real-time feedback after each update or deliverable.

Don't be afraid to make adjustments as needed; stakeholder management is an ongoing process that requires flexibility and adaptability.

Best practices for stakeholder management

Armed with your stakeholder management strategy, you're ready to build strong stakeholder relationships like a pro. But wait, there's more! To truly excel in the stakeholder management process, it's essential to follow some best practices that will elevate your game even further. Let's dive into these tried-and-true tactics that'll make you the talk of the town (in a good way, of course!).

Establish a regular communication cadence

Open and transparent communication is the key to stakeholder management success. Establish a regular communication plan that keeps stakeholders informed and engaged. This might include weekly status updates, daily standups, or monthly progress reports. Find a rhythm that works for your project and stick to it.

Spinach is like an AI Scrum Master and can help you stay consistent. Spinach will suggest stakeholder updates on a weekly basis, removing the human error of forgetting to send something out. And Spinach never takes time off, so even while you're on vacation, stakeholders get the updates they need.

Define what success looks like

It's important to have a clear understanding of what success looks like for your project and stakeholders. This means defining specific deliverables, milestones, and key performance indicators (KPIs) that you can measure and track. By doing so, you create a shared vision of success and ensure that everyone's working towards the same objectives.

Be flexible and ready to adapt

As any seasoned team leader knows, projects can be unpredictable. That's why it's crucial to be flexible and ready to adapt when the unexpected happens. Keep an open mind, and be prepared to make adjustments to your stakeholder management plan as needed.

Spinach can help your team surface potential issues before they become a blocker. This helps you communicate risk real time, and establish trust before the scheduled release date.

Engage stakeholders throughout the project lifecycle

Don't just engage stakeholders at the beginning and end of a project—keep them involved throughout the entire lifecycle. Regularly seek their feedback, share updates, and involve them in decision-making processes. This ongoing engagement helps to maintain alignment, foster collaboration, and ensure that stakeholders feel valued and invested in the project's success.

Use a tool that streamlines stakeholder communication

One of the best ways to excel in stakeholder management is to use a tool that streamlines communication and keeps everyone in the loop. That's where Spinach comes in! 🌱 Spinach is an AI Scrum Master and standup tool that integrates with platforms like Slack, Jira, Zoom, and Google Meet.

Powered by AI, Spinach writes status reports for stakeholders based on decisions made in agile meetings, and updates made to your Jira board. Spinach helps you keep stakeholders informed without you having to lift a finger. Say goodbye to the hassle of manual repetitive updates.

Engage stakeholders seamlessly with Spinach

From understanding the importance of stakeholder management to developing a plan and following best practices, you're now equipped with the knowledge and tools to foster strong, collaborative relationships with your stakeholders. 🎯

Ready to take your stakeholder management game to the next level? Give Spinach a try! With its seamless integration into your existing workflow and AI-powered status reports, you'll keep stakeholders informed and engaged like never before.

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