First-time project managers are eager to implement their own ideas and manage their people to successfully complete their project. What they soon find out is that project success depends on the cooperation of a wide range of individuals(stakeholders), many of whom do not directly report to them.
For example, during the course of a system integration project, a project manager was surprised by how much time she was spending negotiating and working with vendors, consultants, technical specialists, and other functional managers.
Instead of working with my people to complete the project, I found myself being constantly pulled and tugged by demands of different stakeholders groups who were not directly involved in the project but had a vested interest in the outcome.
Project Stakeholders Groups
Too often when new project managers do find time to work directly on the project, they adopt a hands-on approach to managing the project. They choose this style not because they are power-hungry egomaniacs but because they are eager to achieve results.
They become quickly frustrated by how slowly things operate, the number of people that have to be brought on board, and the difficulty of gaining cooperation. Unfortunately, as this frustration builds, the natural temptation is to exert more pressure and get more heavily involved in the project. These project managers quickly earn the reputation of “micro managing” and begin to lose sight of the real role they play on guiding a project.
Some new managers never break out of this vicious cycle. Others soon realize that authority does not equal influence and that being an effective project manager involves managing a much more complex and expansive set of interfaces than they had previously anticipated. They encounter a web of stakeholders relationships that requires a much broader spectrum of influence than they felt was necessary or even possible.
For example, a significant project, whether it involves renovating a bridge, creating a new product, or installing a new information system, will likely involve in one way or another working with a number of different groups of stakeholders:
- Specialists assigned to complete the project. This group is likely to be supplemented at different times by professionals who work on specific segments of the project.
- People within the performing organization who are either directly or indirectly involved with the project.
- Top management, to whom the project manager is accountable.
- Managers who provide resources and/or may be responsible for specific segments of the project.
- Administrative support services such as human resources, finance, etc.
- Different groups outside the organization that influence the success of the project
- The most important stakeholders group is the customer for which the project is designed.
Each of these groups of stakeholders brings different expertise, standards, priorities, and agendas to the project. Stakeholders are people and organizations that are actively involved in the project, or whose interests may be positively or negatively affected by the project.
Managing Stakeholders Dependency
The sheer breadth and complexity of stakeholders relationship distinguish project management from regular management. To be effective, a project manager must understand how stakeholders can affect the project and develop methods for managing the dependency. The nature of these dependencies is identified here:
The project team manages and completes project work. Most participants want to do a good job, but they are also concerned with their other obligations and how their involvement on the project will contribute to their personal goals and aspirations.
Project managers naturally compete with each other for resources and the support of top management. At the same time they often have to share resources and exchange information.
Administrative support groups, such as human resources, information systems, purchasing agents, and maintenance, provide valuable support services. At the same time they impose constraints and requirements on the project such as the documentation of expenditures and the timely and accurate delivery of information.
Functional managers, depending on how the project is organized, can play a minor or major role toward project success. In matrix arrangements, they may be responsible for assigning project personnel, resolving technical dilemmas, and overseeing the completion of significant segments of the project work. Even in dedicated project teams, the technical input from functional managers may be useful, and acceptance of completed project work may be critical to in-house projects. Functional managers want to cooperate up to a point, but only up to a certain point. They are also concerned with preserving their status within the organization and minimizing the disruptions the project may have on their own operations.
Top management approves funding of the project and establishes priorities within the organization. They define success and adjudicate rewards for accomplishments. Significant adjustments in budget, scope, and schedule typically need their approval. They have a natural vested interest in the success of the project, but at the same time have to be responsive to what is best
for the entire organization.
Project sponsors champion the project and use their influence to gain approval of the project. Their reputation is tied to the success of the project, and they need to be kept informed of any major developments. They defend the project when it comes under attack and are a key project ally.
Contractors may do all the actual work, in some cases, with the project team merely coordinating their contributions. In other cases, they are responsible for ancillary segments of the project scope. Poor work and schedule slips can affect work of the core project team. While contractors’ reputations rest with doing good work, they must balance their contributions with their own profit margins and their commitments to other clients.
Government agencies place constraints on project work. Permits need to be secured. Construction work has to be built to code. New drugs have to pass a rigorous battery of U.S. Food and Drug Administration tests. Other products have to meet safety standards, for example, Occupational Safety and Health Administration standards.
Other organizations, depending on the nature of the project, may directly or in-directly affect the project. For example, suppliers provide necessary resources for completion of the project work. Delays, shortages, and poor quality can bring a project to a standstill. Public interest groups may apply pressure on government agencies. Customers often hire consultants and auditors to protect their interests on a project.
Customers define the scope of the project, and ultimate project success rests in their satisfaction. Project managers need to be responsive to changing customer needs and requirements and to meeting their expectations. Customers are primarily concerned with getting a good deal and this naturally breeds tension with the project team.
These relationships are interdependent in that a project manager’s ability to work effectively with one group will affect her ability to manage other groups. For example, functional managers are likely to be less cooperative if they perceive that top management’s commitment to the project is waning. Conversely, the ability of the project manager to buffer the team from excessive interference from a client is likely to increase her standing with the project team.
The project management structure being used will influence the number and degree of external dependencies that will need to be managed. One advantage of creating a dedicated project team is that it reduces stakeholders dependencies, especially within the organization, because most of the resources are assigned to the project. Conversely, a functional matrix structure increases dependencies, with the result that the project manager is much more reliant upon functional colleagues for work and staff.
The old-fashioned view of managing projects emphasized directing and controlling subordinates; the new perspective emphasizes managing project stakeholders and anticipating change as the most important jobs. Project managers need to be able to assuage concerns of customers, sustain support for the project at higher levels of the organization, quickly identify problems that threaten project work, while at the same time defend the integrity of the project and the interests of the project participants.
Within this web of stakeholders relationships, the project manager must find out what needs to be done to achieve the goals of the project and build a cooperative network to accomplish it. Project managers must do so without the requisite authority to expect or demand cooperation. Doing so requires sound communication skills, political savvy, and a broad influence base.