What is Stakeholder Analysis? Definition and Overview

Stakeholders are various individuals, both within and outside the organization, who are interested in the project or may be concerned at some point. These are individuals who will somehow be involved in the project or will be end-users of its completion. Their location may be both within and outside the project area.

Stakeholders are parties that have a direct economic or social interest in the project. In another case, the project may be expected to affect their interests. All organizations, institutions, individuals, groups of people who may be associated with the project are identified as stakeholders.

Stakeholders are often seen as clients, sponsors, project sponsors, the implementing organization, and the public actively involved in the project or those whose interests may be positively or negatively affected by the completion, termination, or termination of the project. Stakeholders can influence the project or its outputs.

There are two types of stakeholders - internal and external to the project. These parties are users of the end product or service; sponsors offering financial resources for a project; program manager; project service; project manager; project team; independent suppliers or partners in project preparation and implementation, etc.

Stakeholder analysis for maximizing the benefits of the project and minimizing its negative impact

Stakeholder analysis is used to identify anyone who may be negatively or positively affected and how. Stakeholder analysis is a typical method inherent in the project management methodology.

The stakeholder analysis process has the following sequence:

  • Stakeholder identification
  • To outline the stakeholder circle, we need to answer the following questions. 
  • Who can influence and influence the project?
  • Who can become a valuable partner of the project even if the project can be realized without its contribution?
  • Who can oppose the project because it considers it a threat to their interests?
  • Who will, in any case, be involved in the project?

Stakeholder categorization

Stakeholders can be classified into specific groups:

  • Target group (a group that will be positively influenced by the effects of the project)
  • Final beneficiaries (groups that will be positively impacted by the long-term impact of the project)
  • Entrepreneurs implementing the project
  • Decision-makers
  • Financing institutions

Stakeholder characteristics

Stakeholders have different statuses and functions in society. Their characteristics include information on: 

  • Social and economic characteristics
  • Status
  • Age
  • Gender differences
  • Attitudes
  • Structure
  • Organization
  • Decision making
  • Status.

Analysis of stakeholders' interests and expectations

Stakeholder interests generally diverge, there may be conflicts of interest between them. Their understanding of what constitutes a successful project also differs.

Therefore, the specific interests, goals, and expectations of each party as to the intentions, content, and outputs of the project should be clarified and described as precisely as possible. T

he motivation of each group and the possibility of attracting them to the project (or counteracting any negative attitudes) should be explored.

It is necessary to analyze the relationships and interactions between different stakeholder groups.

Stakeholder sensitivity analysis

The next step is to analyze the sensitivity of stakeholders to specific topics and issues that may be affected by the project (gender equality, environmental protection, etc.). The requirements and claims of those interested and influenced by the project are identified. The parties affected by the project are projected to have a possible response that may support or hinder the project.

Stakeholder opportunities and deficits

Assessment of potential involves an analysis of existing resources (people, time, financial resources), knowledge, and experience on which the project can be implemented. The importance of each party for the success of the project must be accurately assessed. It is essential to distinguish between the importance of the stakeholders and their degree of influence. It should also be borne in mind that a group may benefit from the project but not have any control over it.

Read the Program stakeholders management section on the BVOP™ Ultimate Guide.

Working with the relevant stakeholder group

Based on the consistent steps in the stakeholder analysis, the conclusions and recommendations of the project determine each party's priority for achieving the project objectives and how to work with the relevant stakeholder group.

Measures for their management are formulated. The measures aim to reduce or eliminate the negative impact of the project on individual stakeholders and, accordingly, the responses that would impede successful implementation.

Measures are also envisaged to meet the needs of the parties better. Stakeholder analysis and targeted interventions developed based on it should reflect the problems and possible ways of solving them from the perspective of a wider audience.

Otherwise, the planned changes will not be publicly accepted and supported. Prerequisites for a synergistic effect of the interaction of project stakeholders should be provided, taking into account all objective and subjective factors.

The results of the stakeholder analysis, including their management measures, shall be recorded in a register used in the implementation of the project and shall be periodically reviewed and updated.

Identifying and analyzing stakeholders by the degree of influence and degree of interest

Another approach to identifying and analyzing stakeholders is to deploy them by the degree of influence and degree of interest, followed by determining the most appropriate communication approach to the type of institutional parameters through which stakeholders become partners supporting the project. A matrix is ​​used to evaluate and classify stakeholders according to their significance/impact and interest.

Stakeholder identification and analysis is an important process in the preliminary phase of project planning because it is a prerequisite for generating broad public support both at the design stage and in the implementation and impact assessment of the project. Following the identification and analysis of the stakeholders, the conclusions are used as a basis for structuring possible partnerships and supporting the project.

Stakeholder analysis is closely linked to problem analysis. Without the views of key stakeholders on a given problem, it is impossible to clarify: its nature, existing needs, and possible solutions. Discussion of stakeholder issues and their involvement in project identification guarantee its applicability and effectiveness.

Comments from the BVOP™ community on "Stakeholder Analysis"

Comments on “What is Stakeholder Analysis? Definition and Overview”

Related posts: