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Ignore stakeholders at your peril

15 May 2017

Stakeholders are those important people who are actively involved in or impacted by any of our projects or sourcing activities. They can and will influence the outcome, precisely because they are likely to be directly affected by it. If we fail to meet the expectations of key stakeholders, projects will be delayed, will only be partially workable or at worst, doomed. If you Google ‘reasons projects fail’ you will find many references to stakeholders, communication, people or teams.
Traditionally, your main groupings of stakeholders are:
• Internal departmental executives, managers and end-users;
• Procurement team members and co-opted subject matter experts;
• Suppliers and their subcontractors;
• Government agencies and the media;
• Customers and society at large;

Procurement has finally moved on from its traditional role, focusing purely on cost savings. As a function, we are now required to add value to the organisation and its different business units through collaborating on projects, making better sourcing decisions and contracting with key suppliers. Stakeholder management is a key element of this.

The role of the chief procurement officer (CPO)
It is the responsibility of the head of the procurement function to communicate procurement’s vision and objectives which must be aligned with those of the organisation. Laying the groundwork by explaining what value procurement will add, how the process will work and why collaboration is important will all smooth the way for work teams. However, he/she cannot do it alone. Everyone has a role to play in their project or task.

Three stakeholder management steps for the success of your project:
1. Identify all key stakeholders. Concentrate on key stakeholders who can make or break the initiative. Make sure every stakeholder has an appropriate way to participate and offer input.
2. Understand and manage their expectations. Identify any potential adversaries early in the process and manage them directly by allocating key tasks to them. Persuade those people who may not be immediately supportive.
3. Keep everyone well-informed and build strong relationships with the people who support the project. Recognise and reward positive behaviours to preserve the relationship and buy continued support.

Why projects fail: communication is the key
Lack of frequent and accurate communication to and from stakeholders is probably one of the main reasons for the failure of projects. Another is not listening to the needs and concerns of the key stakeholders, both internal and external. Speaking with confidence and precision is a skill that can be learnt but so is listening.
How to communicate with stakeholders
The adage which says communicate seven times in seven different ways is very relevant here. Effectively communicating with different generations and global mixes of people is challenging. Dr JoAnn Hackos of the Center for Information-Development Management sums it up like this:
“Think of sending someone an email as just one way of communicating a message. If the customer is a member of the Boomer generation (1946-1964), a phone call with a support person may be much more effective than an impersonal PDF. If the customer is a Generation Xer (1965-1977), communicating through social media as a trusted source of information may be more successful. If the customer is a Millennial (1978 and on), it may be best to send a Twitter or a text message or establish a relationship through a wiki that allows feedback.”

Use leading questions to get buy-in:
• What’s important to you?
• What is your main challenge?
• How can I help you achieve your goals?

Be clear and concise, and use every channel at your disposal. Learn to speak their language in order to gain a better understanding of the issues.
When to communicate with stakeholders:
• Before the launch of a project to get buy-in. Early engagement is important;
• At regular progress meetings held to keep everyone updated. Report back on progress (or lack of it) and milestones achieved;
• Before implementation to ensure alignment with the process and the proposed solution;
• At the end of a project to establish lessons learned.

When you have successfully managed your stakeholders’ expectations and met their needs once, they will feel more comfortable that you can deliver on the next project – and therein that other adage comes into play: “What’s in it for me? (WIIFM)”.

Q. Why do we need to actively manage key stakeholders?
A. Because sourcing and process improvement projects may fail if we don’t.

Contributed by: Elaine Porteous, a senior associate at Bespoke and a freelance business writer and commentator on supply chain and talent management - www.elaineporteous.com