Getting to stakeholders' agreement
Damiano Bragantini, PMP, Agsm Distribuzione
Andrea Caccamese, PMP, Prince2 Practitioner, ITIL V3 Foundation
Literature review demonstrates that stakeholders can be classified and mapped based upon various attributes. Relationship, agreement, and risk leverage were proposed (Bragantini, 2012), as attributes of a model to map stakeholders. “Agreement” is an instrumental component of the model and it represents the degree at which the stakeholder concurs with, or accepts, the project. The aim of this paper is to make a step forward in an effort to find suitable metrics for the level of “agreement.” The execution of a project represents a context in which two parties meet to exchange mutual benefits; any stakeholder might want something from the project (personal benefits, user benefits, financial benefits) and in turn the project might wish to “buy” something from the stakeholder (support, good press, resources). The concept of managing stakeholders as clients, which is gaining consensus (Trentim, 2013), represents the context in which a proposal to measure the level of “agreement” is developed. In this context, the popular “Solution Selling” approach, developed for eagle sellers in difficult markets, is revisited in the perspective of project management to provide a path by which the project manager may measure the level of stakeholder agreement to the project.
Stakeholder Classification and StakeholderShape
Stakeholder classification is a very complex topic and it is fundamental that the project manager (and program or portfolio manager) classifies them in order first of all to rightly communicate with each stakeholder. Communication is not only a personal competence or skill, but also and overall it should be recognized that communication is a prime mover in the execution of a project (or program or portfolio): “Without communication there is no efficient management, or even life. Human is a social creature, so he/she lives in a group, which demands continuous exchange of information” (Bieniok, 2005, p. 9, cited in Wziątek-Staśko, 2011, p. 269).
It is evident that the project manager must perfectly know, as the first thing, to whom to communicate. With this in mind, the project manager needs to correctly register all the stakeholders and search for an accurate classification of the stakeholders especially with regard to communication aspects. There are many definitions of what a stakeholder is; indeed, the debate is very open, and is sometimes confused and contested (Miles, 2012).
One of the most accepted definitions is by Freeman (1984): “any group or individual who can affect or is affected by the achievement of the organization's objectives” (p. 46). This is quite similar to the definition we find in the A Guide to the Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition: “An individual, group or organization who may affect, be affected by, or perceive itself to be affected by a decision, activity or outcome of the project” (PMI, 2013).
These definitions, indeed, vary widely and without any doubt, to stay alive, the project manager needs to assign attributes to each stakeholder to manage him/her/them in the best way.
In literature the most used attributes to analyze and prioritize the stakeholders are:
- Urgency, and
As cited by Adriaan Snauwaert (2012, pp. 13–14):
- “Power is the ability of those who possess power to bring about the outcomes they desire”;
- “Legitimacy is a generalized perception or assumption that the actions of an entity are desirable, proper, or appropriate within some socially constructed system of norms, values, beliefs, and definitions”;
- “Urgency is the degree to which stakeholder claims call for immediate attention”;
- “Proximity is the degree to which stakeholders are closely associated or relatively remote to the organization/ project.”
Also, there are different models for classification such as “regulator, controller, partner, passive, dependent and non-stakeholder” (Mainardes, Alves, & Raposo, 2012, p. 1861).
In the vision of Mitchell, Agle, & Wood (1997), the classification options are: dormant stakeholder, discretionary stakeholder, demanding stakeholder, dominant stakeholder, dangerous stakeholder, and dependent stakeholder.
Surprisingly, stakeholder classification is not confined only to human beings. Maheshwari and Pillai (2004) also suggest a “non-social” classification in which they consider fauna and flora as well.
As we can see, there are many ways in literature to identify and classify stakeholders but always with the aim to define “which of them, and to what extent, should be included in its strategic issues, as all sides will not always have equal interest in certain topics or problems” (Krstić, 2014, p. 168). Nevertheless, “A two-way communication and cooperation with stakeholders represents the business model of the future” (Krstić, 2014, p. 179).
With the aim of a better focus on stakeholders’ communication, in 2012 and 2014, a tool was presented called the StakeholderShape (StSh) (Bragantini, 2012; Bragantini & Ferrante, 2014).
Basically, the idea is that when dealing with communication aspects, attributes such as power, legitimacy, proximity, and urgency should not be so prominent. Nor should the impact, defined as “the ability to successfully influence perceptions during a crisis” (Snauwaert, 2012, p. 16), be a priority when we are dealing with communication aspects. The StakeholderShape methodology suggests that the project manager must concentrate his or her efforts on trying to answer a simple question: How can I “engage” and “manage” the stakeholders correctly? To answer this question, the StakeholderShape tool proposes to investigate only three attributes:
- Agreement: The stakeholder agrees with the project and project objectives
- Relationship: What the stakeholder thinks of the project manager
- Risk leverage: We evaluate stakeholder impact through the risks/stakeholders matrix
In Exhibit 1 the new activities are shown that the project manager must implement to adopt a StakeholderShape methodology.
Exhibit 1: Application of the StakeholderShape methodology.
Through these three attributes, the project manager should be able to set up an adequate stakeholder communication plan. In this paradigm, the classification and mapping of the stakeholders is functional to the building of the communication plan.
The project/program can be compared to a living organism, subject to internal and external changes. Therefore, the methods presented are considered a dynamic function of just changing “stakeholder impact is dynamic and changes over time” (Olander, 2007, p. 285). The StSh will not be static, but will change with the progress of the project and, for sure, the methodology is iterative (Exhibit 2).
Exhibit 2: StakeholderShape iterative process.
Stakeholders as Customers
Trentim (2013) introduces the concept that stakeholders in a project should be considered customers. In this context, the project manager wants to “sell” to stakeholders the product of the project, or the transitory state generated from the project, or the transformations the project will generate, to get something in return, which could be support, good press, or various resources of some kind. There is also an evident similarity between an enterprise that tries to sell complex products and a project (uncertain context, mistrust, high level of innovation, things never seen before). In this view, there is a good level of affinity between a salesperson engaged in selling complex products in complex markets and a project manager engaged in managing a project in a turbulent, uncertain, and all-varying context.
Since 1995 (Bosworth, 1995), a lot of attention has been devoted to how to provide salespeople with selling approaches that fit the peculiarities of selling complex products in difficult markets. In his “Solution Selling” approach, Bosworth recommends using “situational fluency” to avoid jumping immediately to product features, to support the customer in developing a vision biased with the characteristics of the seller's product. “People buy from people,” “A solution is equivalent to the buyer's vision,” “Diagnose before you prescribe,” “Power buys from power,” “Don't close before it's closeable,” and “most people love to buy but hate to feel ‘sold’” are some of the key messages in Bosworth's (1995) book Solution Selling: Creating Buyers in Difficult Selling Markets. In synthesis, Bosworth defines a maturity model for a customer involved in the buying process, represented in Exhibit 3:
Exhibit 3: Four levels of maturity in the buying cycle (adapted from Bosworth, 1995).
Where Bosworth uses the words seller and buyers, we can use the words project manager and stakeholders:
- No pain: The stakeholder is not interested, there is no pain, or the pain does not create an expectation from the project. Stakeholders at this level are not treated in our model.
- Latent needs or latent pain: The project manager sees a need in the stakeholders for his or her product or service (that is, for the project). Latent pain can be of two types: one where the stakeholders are “ignorant” (they don't know the project or its benefits), and the other where the stakeholders have rationalized that there are no solutions to the needs.
- Pain or “active need:” The stakeholder recognizes a need and is actively involved in finding a solution.
- Vision of a solution: The stakeholder has a vision of a solution and the project manager must be very careful and go through the whole process that led to the stakeholder vision, to reach a shared vision.
The project manager must be able to introduce in each stakeholder the right processes to get a shared vision of a solution. In the “Solution Selling” approach, this happens through the nine-block vision-processing model (see Exhibit 4).
The aim is to interact with the stakeholder to push the latent needs into evident needs and then to a common vision. As stated by Trentim (2014), “Project management's goal is to involve and engage stakeholders in value creation”—that is, a common vision.
To develop the vision of the solution, Bosworth (1995) suggests the useful and powerful tool of the nine-block vision-processing model that can facilitate the transition from latent to vision (Exhibit 4).
Exhibit 4: The nine boxes (adapted from Bosworth, 1995).
Using “Solution Selling” the customer is progressively driven by the seller in the transition from pain to vision of the solution through a structured process by which the traditional “Sales Presentation,” “Demos,” and “Roadshows” are replaced by “conversations.” During this process the seller diagnoses, explores impacts, and visualizes capabilities using the nine-block vision-processing model that includes open questions (to elicit from the customer the impact of the pain), control questions (to support the emotional alignment of the customer and the seller), and confirmation questions (to establish a common vision biased with the seller's solution). In this transition, the customer will develop a vision that “should include who will be taking in what action, when in time” (Bosworth, 1995, p. 53) and through which activity or function (Exhibit 5).
Exhibit 5: Steps to develop the vision.
Measuring Stakeholder Agreement
The concepts synthetized above can be adapted to the context of stakeholder management in a project context, in particular in the effort to measure the level of “agreement” in the StakeholderShape approach. The similarities between the context of a project and the context of a sale in “difficult selling markets” are many. The project manager wants to get from a stakeholder something exactly like a sale effort wants to get from a customer his or her money, in exchange for a product, or, better, a “vision of a solution.” The project manager is equivalent to an “eagle seller” engaged in exploring a difficult market, including diffident or reluctant or even unaware customers, who might benefit at some extent from the project. Customers are similar to stakeholders who might be at different stages of “agreement” with the project, ranging from plain unawareness to total involvement and sponsorship. The “Solution Selling” approach is similar to the approach that a project manager should be involved when trying to identify neutral or positive stakeholders, raising their awareness, and establishing the ground for setting up and implementing strategies for their effective engagement in the project (PMI, 2013).
Hence, the proposal is to apply the principles of “Solution Selling” in interacting with stakeholders to measure their level of agreement, or drive its progress, in a model made up of four levels:
- No agreement (level one): The stakeholder is not interested, has no pain, or has pain, but this does not create an expectation for him or her from the project. These stakeholders are not in the domain of further activities of the model.
- Unaware agreement (level two): There is a need, in the eyes of the project manager but not in the mind of the stakeholder for the project, its product, its results, and the transformations to follow.
- Aware agreement (level three): The stakeholder recognizes a need and is actively involved in finding a solution.
- Visioned agreement (level four): The stakeholder develops a vision of a solution, driven by the project manager. This level of agreement can be decomposed into three sublevels:
- Weak visioned agreement): The stakeholder shares his or her pain with the project manager and allows the project manager to enter an emotional alignment state. This is equivalent to the diagnose column of the nine-box “Solution Selling” approach; it is a state where we are in alignment with the emotional pain of the stakeholder.
- Medium visioned agreement: The stakeholder understands and shares with the project manager the impacts of the pain, if not resolved. Impacts might be personal, organizational, or functional and should be qualified by numbers stating, for example, a desired state versus a current state. Equivalent to the explore column of the “Solution Selling” approach, it is a status in which the stakeholder provides us with visibility of organizational impact, widens the range of pain to other organizational stakeholders, and provides us with metrics/KPI to define the project status and where we should be.
- Strong visioned agreement: The stakeholder sees himself/herself in action to solve his or her pain using the capabilities offered by the project. Equivalent to the visualize column of the “Solution Selling” approach, it returns a status in which the stakeholder has developed a vision of a solution to his or her pain that includes the product design or the execution context of the project and finally the state of transformation that will be generated by the activation of the project.
Progress through the aforementioned levels could be sustained adapting the principles of “Solution Selling,” as follows:
- From No agreement to Unaware agreement: This is the process to discover a latent need in the stakeholder. For this step, it seems useful to put at work the sponsor for latent pains that have been “rationalized” (i.e., I tried but there is nothing to do; I removed the problem): This is the case of stakeholders with business or corporate experiences that are probably more familiar for a sponsor rather than for the project manager, who in general has a narrower view of the enterprise or of the business. For “ignored” pains (those for which there is absolutely no awareness), it seems useful to put the project manager to work because he or she knows the project, the project's product, and so on better than the sponsor does.
- From Unaware agreement to Aware agreement: For this step, “Solution Selling” recommends the usage of appropriate reference stories. Applying this principle to the realm of project management, it seems obvious to refer to the lessons learned and the database of knowledge of past projects, perhaps with the involvement of the project management office (PMO), if there is one, either as a prime actor or as a supplier for this knowledge.
- From Aware agreement to Visioned agreement: For this step, “Solution Selling” recommends using the nine-box approach. Applying this principle to the domain of project management, it seems obvious to adopt a slightly simplified approach in which the project manager should go through some sort of serious business analysis with the stakeholder, both for the discovering and clarification of the as-is status, and for the definition of the future state (the vision). A continuous reference to the who, when, what, which (Bosworth, 1995) model is recommended in this step. It is evident that for an effective management of this step the project manager should be equipped with strong business analysis skills and should be supported, when needed and applicable, by appropriate subject matter experts (SMEs). When going through this step, the project manager might stop at any intermediate state in the nine-box model, so intermediate states might be identified and assigned associated values.
In summary, then, the agreement has a life cycle that develops through four levels thanks to the work of several and cooperating people: the Project Manager, the Sponsor, the PMO and suitable Subject Matter Experts (Exhibit 6).
Exhibit 6: The agreement life cycle.
This paper has shown that one of the attributes of the stakeholders—agreement on the project—can and should be measured objectively. With the use of sales techniques considering a framework in which the project manager should manage the stakeholder as a client, it is possible to follow a path through which we can identify and manage a numerical value for the level of agreement.
More studies need to be implemented to correctly identify the numeric value of the agreement, which at present is the result of some practical applications that require a greater number of case studies to refine the results.
Improvements can be made in regard to relationship attribute and how to measure it. A further research topic could be to integrate in the model some hooks to investigate and develop the relationship attribute value as defined in the StakeholderShape methodology.
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© 2015, Damiano Bragantini, Andrea Caccamese
Originally published as a part of the 2015 PMI Global Congress Proceedings – Orlando, Florida, USA