If you’ve been interested in project management for a while, you’ve probably heard the term “stakeholder” being used quite frequently.
We’re here to help you understand what a stakeholder is, why that’s important, and help you overcome any imposter syndrome feelings, one definition at a time.
What’s a stakeholder?
In short, a project stakeholder is literally anyone who’s involved in the project at any point along the way and whose input can impact your results.
For example, let’s say you run a construction company and you’re building a new skyscraper in your city. In this case, the most obvious stakeholders are the clients—those who paid you to build it.
However, other stakeholders, in this case, would also be the employees, executives, project managers, and every person involved in the construction of the project.
There’s a less obvious and often-overlooked segment of stakeholders: people you affect indirectly (both positively and negatively).
When building a skyscraper, you’ll need tons of materials, talent, equipment, and technology. So many people will benefit from it, like:
- Nearby restaurants
- Outsourcing companies
Also, people who live nearby will have to stand all the noise and inconvenience. And once the skyscraper or the successful project is finished, users will enjoy it (or bemoan it), making them stakeholders too.
Why are stakeholders important?
If project managers ignore stakeholders’ input, they’ll face roadblocks and surprises that can slow the process down. If you don’t hear them out, your results might be inconsistent with their expectations.
But let’s say you ignore them and start working based on what you think might work best. Even if you build exactly what your client asked for, you might end up building something users don’t want.Stakeholders are important because they provide you with key insights to improve your project and avoid potential roadblocks, issues, and delays.
Research suggests that teams who engage with key stakeholders increase their likelihood of meeting a project’s deadline without overrunning costs.
What’s a key stakeholder?
It’s worth mentioning that not all stakeholders are created equal.
Even though all of them matter, some of them are more crucial for the success of a particular project. We call them “key stakeholders.”
Key stakeholders are the entities whose input will make the biggest impact on your project.
- Project sponsors
- End users
Each organization needs to make a deep analysis to discover its key stakeholders before a project begins.
In addition, you should consider how your stakeholders’ engagement might change along the way to make sure you’re always on the right track.
For further reading, we recommend our comprehensive guide on stakeholder analysis.
What are the 2 types of stakeholders?
As we covered earlier, there are different types of stakeholders.
The 2 main categories are:
- Internal stakeholders: they have a direct relationship with the organization and the project affects them directly.
- External stakeholders: they have an indirect relationship with the organization and the project’s outcomes affect them in some way.
10 examples of project stakeholders
Sometimes, identifying stakeholders might be difficult. But we believe that, with some examples in mind, the process will be easier.
Internal stakeholder examples
Some examples of internal stakeholders include:
- Internal clients: those who pay a company to develop a specific product and provide directions and specs.
- Sponsors: people who invest capital in a project or make sure the funding is available and help promote its success.
- Technical talent: employees who are vital for project success.
- Executives: the bigwigs of the parent organization that initiated a particular project.
- Project team: project managers and everyone directly involved in the project cycle of a project.
External stakeholder examples
Some examples of external stakeholders include:
- Customers: the end-users of the final product or service.
- Government: Government agencies that regulate a specific project, market, or industry.
- Communities: anyone who’s benefited or affected by your project’s outcome.
- Suppliers: people and companies that provide the inputs, resources, and raw materials to build the end product.
- Creditors: any person, company, and organization who funds your project through credit.
What is the role of a stakeholder?
The role of each stakeholder depends on their role at the organization and whether they’re internal or external.
Some of the main roles are:
- Project direction: ensure the project moves in the right direction and the final product meets—and exceeds—the initial expectations.
- Management direction: many stakeholders are part of the organization’s leadership and contribute to the decision-making of the company.
- Project funding: provide or find the monetary resources to execute a project.
- Long-term conscience: vote against any decision that can potentially harm the greater good.
- Provide insights: surveying end users of the product can help you identify new areas for market penetration and avoid potential roadblocks and challenges.
- Participation: participate in the creation of the project charter, project scope statement, and many key documents and processes.
- Provide specifications and requirements: to make sure the end result is consistent with the client’s expectations.
Introduction to stakeholder management
Identifying project stakeholders is just one of the 4 steps of the stakeholder management process.
This process consists of building solid relationships with key stakeholders so you understand what they want and direct your initiatives toward the right goals.
Besides, understanding your stakeholders can help you reduce friction and resistance across every stage of the process.
According to the PMBOK (Project Management Book of Knowledge), the 4 steps of the stakeholder management process are:
- Identify: identify who your stakeholders are and what matters the most to them.
- Plan: develop a solid strategy to keep your stakeholders involved in the project.
- Manage: define communication channels with stakeholders to make sure you always meet their expectations.
- Monitor: monitor your relationship with relevant stakeholders and adjust appropriately.
How to manage stakeholders with monday.com
Now that you understand what a stakeholder is and why they’re important, it’s time to talk about how to delight them.
A robust project management platform can help you keep organized, focus on what really matters, and deliver better projects with efficiency.
Now let’s talk about monday.com and how it can revolutionize the way you approach projects and stakeholder engagement.
monday.com is a powerful digital workspace to manage teams and projects with more efficiency.
In fact, more than 100,000 companies—including Coca-Cola, L’ORÉAL, and Adobe, among others—trust us to manage their organizations.
Our platform is 100% data-driven, which means we provide you with powerful reporting and data visualization features to keep everyone on the same page.
A rather recent study suggests that most PMOs (Project Management Offices) state that project status reporting has become their main activity.
Key stakeholders will always want to measure how your project is progressing against KPIs (key performance indicators) and the baseline plan. Accurate, up-to-date reporting is the best way to keep them happy.
But effective reporting is just the tip of the iceberg.
Let’s take a closer look at some other helpful features.
What do we offer?
Some key features of monday.com include:
- Workflow management: assign activities to coworkers and measure the progress of your project in a single platform.
- Custom reporting: get access to key insights and delight your stakeholders with customizable reports.
- A data-driven platform: visualize data from multiple projects under one roof and improve your decision-making.
- Security: get access to enterprise-level security features, including permission levels.
- Team collaboration: bring in your teammates, guests, clients, and more. Work together in an intuitive platform.
- Data visualizations: visualize your data from multiple perspectives, including Kanban, Calendar, Gantt, Map, and more.
- Templates: choose from over 200 premade templates for any use case and industry.
Stakeholder identification and management made easy
Any project will involve different stakeholders. They’re vital for a company’s success.
They help you gain valuable insights, follow the right path, and direct your initiatives on what really matters.
Effective project management software can help you keep your stakeholders happy as they increase transparency across your organization and centralize communication.
With monday.com, you get access to features that’ll revolutionize the way you manage your team and stakeholders.