Categorize stakeholders

In the realm of Project Management as outlined by Project Management Institute’s (PMI) Project Management Professional (PMP) certification, stakeholders play a crucial role. A comprehensive understanding of stakeholder categorization is vital for the successful execution of a project, as it aids in stakeholder engagement planning and management throughout the lifecycle of the project.

Who Are Stakeholders?

Stakeholders are individuals, groups, or organizations that are affected by your project’s outcome, or whose actions can impact your project’s outcome. They may vary from project team members, project managers, sponsors, to customers, suppliers, and even government bodies.

The key to efficient stakeholder management is understanding their interest and influence level, expectations, potential impact on the project, and grouping them accordingly. This is where stakeholder categorization comes in.

How to Categorize Stakeholders

There are several methods to categorize stakeholders, with each method providing a unique perspective on stakeholder management. Here are some notable ones:

• Power/Interest Grid: This is a 2-dimensional grid that categorizes stakeholders based on their level of interest and their power to influence the project. By carefully plotting stakeholders on this grid, a project manager is better equipped to identify the stakeholders that need focused management attention.

For instance, stakeholders with high power and interest are key players who are crucial to project success and require careful management. Those with low interest but high power need to be kept satisfied, while those with high interest but low power should be regularly kept informed. Stakeholders with low power and interest need minimal effort.

• Power/Influence Grid: This grid takes into account the stakeholders’ power and their ability to influence a project’s outcome. It helps to highlight those who hold the most power and significantly impact project success.
• Influence/Impact Grid: This method emphasizes the stakeholders’ ability to influence project outcome and their potential impact on the project. It assists in identifying stakeholders who, while unable to directly influence the project, may still cause disruption if not managed carefully.
• Internal/External Categorization: This mode categorizes stakeholders into internal (employees, project team, managers etc.) or external (customers, vendors, regulatory authorities etc.) groups. This provides valuable insights on stakeholder management strategy as internal and external stakeholders generally require different approaches.
• Salience Model: This model classifies stakeholders based on three attributes: power, legitimacy, and urgency. This categorization is useful in identifying stakeholders who may not have direct influence or interest in the project but should not be overlooked.

In conclusion, stakeholder categorization is a significant part of stakeholder management and contributes to the overall success of any project. It is instrumental in facilitating communication, managing expectations, and influencing stakeholders in an efficient manner. Therefore, for PMP aspirants and certified project managers alike, the understanding and application of stakeholder categorization remain crucial.

References:

• Project Management Institute, A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Sixth Edition, Project Management Institute Inc., 2017.
• Mitchell, R., Agle, B., & Wood, D. (1997). Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts. Academy of Management Review, 22(4), 853-886.