Stakeholder analysis is a technique used to identify the stakeholders, and their interest, experience and influence on the project.
Why is Stakeholder Classification important
Large projects may have hundreds or even thousands of stakeholders. Projects have limited time, and resources. Therefore, the amount of effort spent on stakeholder management and engagement needs to be prioritized. But what criteria do we use to classify the stakeholders? How do project managers determine which stakeholders have the biggest impact or influence on the project and deserve the most attention? How do project managers prioritize their attention to competing stakeholders?
These are exactly the problems that the stakeholder classification models address. It is important to prioritize the stakeholders to ensure efficient use of effort to communicate and manage their expectations. We have various models that help classify the stakeholders according to the their power, interest, impact, influence, urgency and other parameters.
Stakeholder Classification Models
Several models are available to classify stakeholders as described below.
The grid-based models are useful for small projects or projects with simple stakeholder relationships. The three common grid-based models are:
- Power/Interest grid
- Power/Influence grid
- Impact/Influence grid
These grid-based models are explained in detail in PMI Library article Stakeholder analysis - a pivotal practice of successful projects and in MindTools’ article Stakeholder Analysis.
The three dimensions of a stakeholder cube are:
Mosaic Project’s post For Stakeholders, 2×2 Is Not Enough! provides a very good explanation of the Stakeholder Cube.
The Salience Model classifies stakeholders based on their:
- Urgency, and
Refer to Deep Fried Brain Project’s blog post The Salience Model for Stakeholder Classification for an in-depth explanation of the Salience Model.
Directions of Influence
Stakeholders can be classified based on their influence on the project or the project team. This method of classification includes:
- Upward: Senior management, sponsor, steering committee
- Downward: Project team members and experts working on the project
- Outward: Suppliers, government agencies, regulators, public and end users
- Sideward: Peers such as other project managers, and functional managers
Prioritizing stakeholders may be necessary when:
- Large number of stakeholders are involved
- Stakeholders are changing rapidly
- Relationship with stakeholders is complex