Stakeholder Identification: Why Is It So Important?

Stakeholder Identification: Why Is It So Important?
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The Fundamentals

We all do it – or at least need to do it, and do it well. It’s fundamental to running a good project. And the 4th Edition PMBOK (R) Guide finally recognizes it. What is it? Stakeholder identification. In this brief article I’ll discuss stakeholder identification and follow-up with more on stakeholder analysis.

Let’s go right to the PMBOK® Guide, because they have included stakeholder identification as a new process – and this at a time when the effort was to reduce the number of processes. So that tells you they felt this was important. They made it a new process in Project Communications Management. Importantly, it’s a predecessor process to Plan Communications. Why? Because how are you going to plan to whom you’ll communicate and how you will communicate if you don’t know first who all of these folks are?

So…how does the PMI define this? “Identify Stakeholders is the process of identifying all people or organizations impacted by the project, and documenting relevant information regarding their interests, involvement, and impact on project success. The process has as outputs a Stakeholder Register and a Stakeholder Management Strategy."

How are stakeholders identified? The PMBOK(R) Guide recommends a three step process:

  • Step 1: Identify all potential stakeholders and relevant information (see below for some coaching on this).
  • Step 2: Identify the potential impact or support each stakeholder. You could generate and use a Power/Interest Grid to classify them (this will be the subject of the follow-up article).
  • Step 3: Assess how the stakeholders are likely to react or respond in various situations to help plan influencing them to enhance support or mitigate negative impacts. Sound like risk management? It’s a lot like risk management. In fact, it’s fundamental to risk management. Why? Leave out a stakeholder or the way they’d react to a project situation, and you leave out an identified risk. You cannot respond to a risk for which you’ve not identified!

Identification Is Not Just Hot Air


Given the connection to risk management and threats, I would like to make a key point here: Opponents are also stakeholders.Let me illustrate with an example.

Cape Wind is a renewable energy project planned for the waters of Nantucket Sound. If Cape Wind is successful, it will generate about 3/4 of the energy consumed by Cape Cod with renewable, clean energy. It will generate 600 to 1,000 jobs in the area. Not everyone is a supporter, though.

Observe this snippet from an issue of Business Week: “the first large-scale effort to harness sea breezes in the U.S. hit resistance from an army led by the rich and famous, waging a not-on-my-beach campaign. For almost eight years the critics have stalled the project, called Cape Wind, which aims to place 130 turbines in Nantucket Sound about five miles south of Cape Cod. Yet surprisingly, Cape Wind has largely defeated the big guns. In a few months it may get authorization to begin construction. "

Also, here is the promised coaching about identifying stakeholders. It comes to us via an excellent text, “The Handbook of Program Management”, by James T. Brown:

  • Follow the money! Whoever is paying is definitely a stakeholder. Also, if the program produces savings or additional costs for an organization then the organization is also a stakeholder.

  • Follow the resources. Every entity that provides resources, whether internal or external, labor or facilities, and equipment, is a stakeholder. Line managers and functional managers providing resources are stakeholders.

  • Follow the deliverables. Whoever is the recipient of the product or service the program is providing is a stakeholder.

  • Follow the signatures. The individual who signs off on completion of the final product or service (or phases thereof) is a stakeholder. Note: This may or may not be the recipient referred to in the previous bullet. Often there may be more recipients than signatories.

  • Examine other programs’ stakeholder lists. Include active programs and completed projects.

  • Review the organizational chart to assess which parts of the organization may be stakeholders.

  • Ask team members, customers, and any other confirmed stakeholder to help you identify additional stakeholders.

  • books

    Look for the “Unofficial People of Influence.” These may be people who are trusted by high-level leaders or who wield a lot of power through influence and not position.

Work this item hard in your projects. I think most of us agree that “communications is key,” and that “we cannot communicate enough.” But often, the stakeholders who need that communication are left out of the loop, so the best technology and the crispest communications fall flat on their faces. Identify, identify, identify, before you plan communications.It’s right there in the PMBOK® Guide now!


A Guide to the Project Management Body of Knowledge, 4th Edition (C) 2008 PMI

The Handbook of Program Management, James T. Brown (C) 2007, McGraw-Hill

Image of people selecting stakeholders (C) Microsoft clip art

Image of wind turbine - from the public domain

Image of “Handbook of Program Management” - public domain