What is A Stakeholder Analysis? Stakeholder Analysis In A Nutshell

A stakeholder analysis is a process where the participation, interest, and influence level of key project stakeholders is identified. A stakeholder analysis is used to leverage the support of key personnel and purposefully align project teams with wider organizational goals. The analysis can also be used to resolve potential sources of conflict before project commencement.

Stakeholder AnalysisDescriptionAnalysisImplicationsApplicationsExamples
1. Identify Stakeholders (IS)Stakeholder Analysis begins with identifying all individuals, groups, or entities that have an interest or stake in the organization, project, or decision.– Compile a comprehensive list of stakeholders, both internal and external. – Consider their level of influence, interest, and relevance to the initiative.– Ensures that all relevant parties are accounted for in the analysis. – Helps prioritize stakeholders based on their significance and impact.– Identifying stakeholders in a construction project, including investors, local communities, and regulatory bodies. – Listing key stakeholders in a product launch, such as customers, suppliers, and employees.Stakeholder Identification Example: Identifying government agencies, local communities, and environmental organizations as stakeholders in a sustainable energy project.
2. Stakeholder Mapping (SM)Stakeholder Mapping involves categorizing stakeholders based on their level of influence and their level of interest or involvement.– Create a matrix or diagram to place stakeholders in appropriate categories, such as high influence/interest, low influence/interest, etc. – Determine the potential impact of stakeholders on the initiative.– Provides a visual representation of stakeholder positions, facilitating strategic engagement efforts. – Identifies key stakeholders who require focused communication and relationship management.– Mapping stakeholders in a public infrastructure project to prioritize engagement strategies. – Categorizing stakeholders in a corporate social responsibility (CSR) initiative based on their relevance and influence.Stakeholder Mapping Example: Placing regulatory authorities in the “High Influence/High Interest” category for a compliance project.
3. Assess Needs and Expectations (NE)Assessing Needs and Expectations involves understanding the specific needs, expectations, and interests of each stakeholder group.– Conduct interviews, surveys, or consultations to gather insights into what each stakeholder group seeks or values in relation to the initiative. – Document their concerns, goals, and expectations.– Enables the organization to tailor its strategies, actions, and communications to meet stakeholders’ specific requirements. – Supports the development of strategies to address potential conflicts or challenges.– Collecting feedback from customers to understand their product preferences and expectations. – Conducting consultations with local communities to address their concerns in a development project.Needs Assessment Example: Gathering feedback from employees about their expectations for a workplace diversity and inclusion program.
4. Analyze Influence and Power (IP)Analyzing Influence and Power involves evaluating the degree of influence or power that each stakeholder wields over the initiative.– Assess the resources, authority, and relationships that contribute to a stakeholder’s influence. – Determine the potential impact of a stakeholder’s support or opposition on the success of the initiative.– Helps identify stakeholders who can significantly affect the outcome and must be engaged effectively. – Supports strategies to build positive relationships with influential stakeholders and mitigate risks associated with powerful opponents.– Evaluating the influence of industry associations and lobbying groups on policy decisions. – Assessing the power dynamics among project team members and external partners in a collaborative project.Influence Analysis Example: Recognizing that a major shareholder’s opposition to a merger could significantly impact the deal’s success.
5. Develop Engagement Strategies (ES)Developing Engagement Strategies involves creating tailored approaches to engage with each stakeholder group effectively.– Based on stakeholder categorization, design strategies for communication, involvement, and relationship building. – Consider how to address stakeholders’ needs, concerns, and expectations proactively.– Ensures that stakeholder engagement efforts are targeted and aligned with their specific interests. – Facilitates the development of communication plans, feedback mechanisms, and conflict resolution strategies.– Creating a communication plan to keep customers informed about product updates and improvements. – Developing a community engagement strategy for a construction project to address local concerns and build support.Engagement Strategy Example: Implementing a regular newsletter and feedback mechanism to engage with project investors and keep them informed.
6. Continuous Monitoring and Adaptation (MA)Continuous Monitoring and Adaptation involves ongoing assessment of stakeholder dynamics and adjustments to engagement strategies.– Regularly review stakeholder relationships, feedback, and changing circumstances. – Adapt engagement strategies based on evolving stakeholder needs and project developments.– Ensures that stakeholder engagement remains effective and responsive to changing conditions. – Enables proactive identification and mitigation of emerging issues or conflicts.– Monitoring stakeholder feedback and adjusting sustainability initiatives in response to changing environmental concerns. – Reviewing stakeholder engagement efforts in a political campaign and making adjustments based on shifting public sentiment.Monitoring Example: Responding to shifts in public opinion by modifying communication strategies to align with stakeholder sentiment.

Perform a Stakeholder Analysis

Understanding a stakeholder analysis

Fundamentally, a stakeholder analysis involves the systematic gathering of qualitative information to determine whose interests should be considered when developing (or implementing) a project, program, or policy.

Considering that stakeholders have a vested interest in a project, maintaining a good relationship with them is crucial to project success. 

To that end, a stakeholder analysis is used to:

  • Leverage the help of key players – this includes executives and other influential stakeholders who have knowledge and experience to impart. 
  • Align stakeholders with project goals and planning – in a 2020 survey, 35% of project teams wished they had a clearer purpose and company strategy. A stakeholder analysis can align project goals with broader company values, resulting in more effective project outcomes.
  • Address conflict or other issues – sometimes, a relevant stakeholder will not see value in a project and will actively attempt to thwart its progress. Conducting a stakeholder analysis before project commencement allows potential objections to be raised and resolved.

Conducting a stakeholder analysis

The exact methodology of a stakeholder analysis will vary depending on the industry and the nature of the project, program, or policy.

However, some steps are universal and they are outlined below:

Step 1 – Determine the stakeholders

Brainstorm a list of stakeholders and be as exhaustive as possible. Stakeholders invariably include marketing, finance, sales, procurement, manufacturing, and executive staff.

Step 2 – Group and prioritize stakeholders

In a stakeholder analysis, prioritization is commonly performed by using a power/interest grid. 

Here, each stakeholder is grouped into one of four categories:

  1. Players (high interest/high power) – these are the stakeholders with decision-making power who require consistent collaboration and engagement.
  2. Subjects (high interest/low power) – through knowledge or experience, these stakeholders offer valuable insights or provide capital. However, they do not have any power to make decisions. Subjects usually include project investors or shareholders.
  3. Context setters (low interest/high power) – or stakeholders that can, at least theoretically, exert a great deal of influence. While they should be updated periodically, they choose not to be involved in the day-to-day minutiae of project management. Government entities and senior executives are often context setters.
  4. Crowd (low interest/low power) – a group of stakeholders requiring some degree of communication but little else. This includes colleagues and co-workers, particularly those in a different department who may be affected by project outcomes but have little role in the project itself.

Step 3 – Communication to gain buy-in

Once each stakeholder has been placed on the grid, a strategy must be devised to garner their continued support.

For a good frame of reference for strategy creation, consider the following questions:

  • How is each category of shareholder motivated? Do they have a financial or emotional investment?
  • What other priorities do they have? How can project priorities be aligned? If alignment is impossible, how can these priorities exist harmoniously?
  • Does the stakeholder hold a positive view of the project? Will their position change as the project progresses? What can be done to improve this view?

Case Studies

Construction Project:

  • Stakeholders: In a large construction project, stakeholders include the project owner, architects, engineers, contractors, local residents, environmental agencies, and government authorities.
  • Analysis: The project owner has high interest and power as they make critical decisions. The local residents have high interest but low power, as their concerns must be addressed but don’t control the project. Environmental agencies and government authorities are context setters with the power to influence project permits and regulations.
  • Communication Strategy: The project team engages with local residents through regular meetings to address concerns. They collaborate closely with the project owner to align goals and ensure timely decision-making. They maintain open communication with regulatory bodies to comply with environmental and legal requirements.

Product Launch:

  • Stakeholders: When launching a new product, stakeholders include the product development team, marketing department, sales team, customers, investors, and regulatory agencies.
  • Analysis: The product development team has high interest and power as they drive product development. Investors have high interest but may not have direct decision-making power. Regulatory agencies have high power but may not be highly interested in the product launch.
  • Communication Strategy: The product development team collaborates closely with the marketing and sales teams to align strategies and goals. They provide regular updates to investors on the progress of the product launch. Regulatory compliance is ensured through proactive communication and adherence to guidelines.

Healthcare Policy Implementation:

  • Stakeholders: Implementing a new healthcare policy involves stakeholders such as policymakers, healthcare providers, patients, insurance companies, and advocacy groups.
  • Analysis: Policymakers have high power and interest as they shape the policy. Healthcare providers, including doctors and hospitals, have high interest and varying levels of power. Patients have high interest but limited power in policy decisions. Insurance companies have high power but may not be highly interested in the policy. Advocacy groups can have varying degrees of both power and interest.
  • Communication Strategy: Policymakers engage in discussions with healthcare providers to address concerns and ensure successful policy implementation. Patients are informed about changes and involved in decision-making processes when relevant. Insurance companies are consulted to align policy with existing coverage, and advocacy groups are engaged based on their influence.

Nonprofit Organization Fundraising:

  • Stakeholders: A nonprofit organization conducting a fundraising campaign may have stakeholders such as donors, volunteers, beneficiaries, board members, and the general public.
  • Analysis: Donors have high interest and power, as their contributions are essential. Volunteers have high interest but limited power in decision-making. Beneficiaries have high interest in the organization’s work. Board members hold significant power and interest. The general public may have varying levels of interest and power.
  • Communication Strategy: The nonprofit organization maintains open communication with donors, acknowledging their contributions and providing updates on the impact of donations. Volunteers are actively involved in campaign activities and recognized for their efforts. Beneficiaries are informed about how funds will be used to support their needs. Board members are engaged in strategic planning, and the general public is informed about the campaign’s goals and progress.

Software Development Project:

  • Stakeholders: In a software development project, stakeholders may include project managers, developers, quality assurance teams, clients, end-users, and regulatory authorities.
  • Analysis: Project managers have high power and interest as they oversee the project. Developers have high interest and power to influence the project’s technical aspects. Clients have high interest and financial power as they fund the project. End-users are highly interested in the final product’s usability. Regulatory authorities have high power but may not be deeply interested in the project’s details.
  • Communication Strategy: Project managers collaborate closely with developers to ensure project milestones are met. Clients are regularly updated on project progress and budget. End-users may participate in user testing and feedback sessions. Regulatory compliance is maintained through ongoing communication and adherence to standards.

E-commerce Platform Launch:

  • Stakeholders: When launching an e-commerce platform, stakeholders include product managers, developers, marketing teams, customers, investors, and payment service providers.
  • Analysis: Product managers have high power and interest in platform features. Developers have high interest and power to shape the platform’s functionality. Marketing teams have high interest in successful platform promotion. Customers are highly interested in user experience. Investors have high financial power. Payment service providers have high power in ensuring secure transactions.
  • Communication Strategy: Product managers work closely with developers to align platform features with market needs. Marketing teams develop strategies to attract and retain customers, keeping them informed about platform benefits. Investors receive updates on financial performance. Payment service providers collaborate on security measures and compliance.

Merger and Acquisition (M&A) Deal:

  • Stakeholders: In an M&A deal, stakeholders include executives, legal teams, shareholders, employees, regulatory agencies, and industry analysts.
  • Analysis: Executives have high power and interest in deal negotiations. Legal teams play a critical role in ensuring legal compliance. Shareholders have high financial interest. Employees are concerned about job security. Regulatory agencies have significant power to approve or block the deal. Industry analysts can influence market perception.
  • Communication Strategy: Executives lead negotiations and engage with legal teams to address regulatory requirements. Shareholders are informed about the potential impact on their investments. Employees receive transparent communication about the merger’s effects on the workforce. Regulatory agencies are consulted and provided with necessary documentation. Industry analysts are briefed to shape public opinion.

Cybersecurity Incident Response:

  • Stakeholders: During a cybersecurity incident, stakeholders include IT security teams, executive leadership, legal and compliance departments, customers, law enforcement agencies, and affected third-party vendors.
  • Analysis: IT security teams have high power and interest in resolving the incident. Executive leadership holds decision-making power. Legal and compliance teams ensure regulatory adherence. Customers may experience disruptions and data breaches. Law enforcement agencies have investigative authority. Third-party vendors may be implicated in the incident.
  • Communication Strategy: IT security teams lead incident response efforts and collaborate with executive leadership on decision-making. Legal and compliance teams manage regulatory notifications and responses. Customers are informed about the incident, impact, and mitigation measures. Law enforcement agencies are engaged as needed. Third-party vendors are contacted and cooperate in resolving the incident.

Key takeaways:

  • A stakeholder analysis is a means of determining the interest, participation, and influence level of key project stakeholders.
  • A stakeholder analysis is used to leverage the support of key personnel and purposefully align project teams with wider organizational goals. The analysis can also be used to resolve potential sources of conflict before project commencement.
  • Stakeholder analyzes will vary depending on the industry. But at the very least, stakeholders should be categorized according to their level of interest and power. Then, a communication strategy must be devised for each.

Key Highlights

  • Purpose of Stakeholder Analysis:
    • Stakeholder analysis is a process to identify key project stakeholders’ participation, interest, and level of influence.
    • It aims to align project teams with broader organizational goals and resolve potential conflicts before project initiation.
  • Benefits of Stakeholder Analysis:
    • Leveraging the support of influential stakeholders, including executives and key personnel.
    • Aligning project goals with overall company values and strategies for more effective outcomes.
    • Addressing conflicts or objections from stakeholders before they impact the project.
  • Stakeholder Analysis Process:
    • Step 1: Determine Stakeholders: Create an exhaustive list of stakeholders, encompassing various departments and roles.
    • Step 2: Group and Prioritize Stakeholders: Categorize stakeholders using a power/interest grid:
      • Players (high interest/high power): Decision-makers requiring ongoing collaboration.
      • Subjects (high interest/low power): Offer insights or capital but lack decision-making power.
      • Context setters (low interest/high power): Have influence but minimal involvement in day-to-day management.
      • Crowd (low interest/low power): Need communication but limited engagement in the project.
    • Step 3: Develop Communication Strategy: Create strategies to maintain support from each stakeholder category:
      • Understand motivations: Financial, emotional, or other factors influencing each stakeholder.
      • Align priorities: Determine how project and stakeholder priorities can coexist harmoniously.
      • Manage perception: Improve stakeholder views of the project and adapt strategies as needed.
  • Adaptation to Industry:
    • Stakeholder analysis methodologies may vary based on industry and project specifics.
    • The fundamental steps of identifying, categorizing, and communicating with stakeholders remain applicable across industries.

Connected Analysis Frameworks

Failure Mode And Effects Analysis

A failure mode and effects analysis (FMEA) is a structured approach to identifying design failures in a product or process. Developed in the 1950s, the failure mode and effects analysis is one the earliest methodologies of its kind. It enables organizations to anticipate a range of potential failures during the design stage.

Agile Business Analysis

Agile Business Analysis (AgileBA) is certification in the form of guidance and training for business analysts seeking to work in agile environments. To support this shift, AgileBA also helps the business analyst relate Agile projects to a wider organizational mission or strategy. To ensure that analysts have the necessary skills and expertise, AgileBA certification was developed.

Business Valuation

Business valuations involve a formal analysis of the key operational aspects of a business. A business valuation is an analysis used to determine the economic value of a business or company unit. It’s important to note that valuations are one part science and one part art. Analysts use professional judgment to consider the financial performance of a business with respect to local, national, or global economic conditions. They will also consider the total value of assets and liabilities, in addition to patented or proprietary technology.

Paired Comparison Analysis

A paired comparison analysis is used to rate or rank options where evaluation criteria are subjective by nature. The analysis is particularly useful when there is a lack of clear priorities or objective data to base decisions on. A paired comparison analysis evaluates a range of options by comparing them against each other.

Monte Carlo Analysis

The Monte Carlo analysis is a quantitative risk management technique. The Monte Carlo analysis was developed by nuclear scientist Stanislaw Ulam in 1940 as work progressed on the atom bomb. The analysis first considers the impact of certain risks on project management such as time or budgetary constraints. Then, a computerized mathematical output gives businesses a range of possible outcomes and their probability of occurrence.

Cost-Benefit Analysis

A cost-benefit analysis is a process a business can use to analyze decisions according to the costs associated with making that decision. For a cost analysis to be effective it’s important to articulate the project in the simplest terms possible, identify the costs, determine the benefits of project implementation, assess the alternatives.

CATWOE Analysis

The CATWOE analysis is a problem-solving strategy that asks businesses to look at an issue from six different perspectives. The CATWOE analysis is an in-depth and holistic approach to problem-solving because it enables businesses to consider all perspectives. This often forces management out of habitual ways of thinking that would otherwise hinder growth and profitability. Most importantly, the CATWOE analysis allows businesses to combine multiple perspectives into a single, unifying solution.

VTDF Framework

It’s possible to identify the key players that overlap with a company’s business model with a competitor analysis. This overlapping can be analyzed in terms of key customers, technologies, distribution, and financial models. When all those elements are analyzed, it is possible to map all the facets of competition for a tech business model to understand better where a business stands in the marketplace and its possible future developments.

Pareto Analysis

The Pareto Analysis is a statistical analysis used in business decision making that identifies a certain number of input factors that have the greatest impact on income. It is based on the similarly named Pareto Principle, which states that 80% of the effect of something can be attributed to just 20% of the drivers.

Comparable Analysis

A comparable company analysis is a process that enables the identification of similar organizations to be used as a comparison to understand the business and financial performance of the target company. To find comparables you can look at two key profiles: the business and financial profile. From the comparable company analysis it is possible to understand the competitive landscape of the target organization.

SWOT Analysis

A SWOT Analysis is a framework used for evaluating the business’s Strengths, Weaknesses, Opportunities, and Threats. It can aid in identifying the problematic areas of your business so that you can maximize your opportunities. It will also alert you to the challenges your organization might face in the future.

PESTEL Analysis

The PESTEL analysis is a framework that can help marketers assess whether macro-economic factors are affecting an organization. This is a critical step that helps organizations identify potential threats and weaknesses that can be used in other frameworks such as SWOT or to gain a broader and better understanding of the overall marketing environment.

Business Analysis

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Financial Structure

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Financial Modeling

Financial modeling involves the analysis of accounting, finance, and business data to predict future financial performance. Financial modeling is often used in valuation, which consists of estimating the value in dollar terms of a company based on several parameters. Some of the most common financial models comprise discounted cash flows, the M&A model, and the CCA model.

Value Investing

Value investing is an investment philosophy that looks at companies’ fundamentals, to discover those companies whose intrinsic value is higher than what the market is currently pricing, in short value investing tries to evaluate a business by starting by its fundamentals.

Buffet Indicator

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Financial Analysis

Financial accounting is a subdiscipline within accounting that helps organizations provide reporting related to three critical areas of a business: its assets and liabilities (balance sheet), its revenues and expenses (income statement), and its cash flows (cash flow statement). Together those areas can be used for internal and external purposes.

Post-Mortem Analysis

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Retrospective Analysis

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Root Cause Analysis

In essence, a root cause analysis involves the identification of problem root causes to devise the most effective solutions. Note that the root cause is an underlying factor that sets the problem in motion or causes a particular situation such as non-conformance.

Blindspot Analysis


Break-even Analysis

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Decision Analysis

Stanford University Professor Ronald A. Howard first defined decision analysis as a profession in 1964. Over the ensuing decades, Howard has supervised many doctoral theses on the subject across topics including nuclear waste disposal, investment planning, hurricane seeding, and research strategy. Decision analysis (DA) is a systematic, visual, and quantitative decision-making approach where all aspects of a decision are evaluated before making an optimal choice.

DESTEP Analysis

A DESTEP analysis is a framework used by businesses to understand their external environment and the issues which may impact them. The DESTEP analysis is an extension of the popular PEST analysis created by Harvard Business School professor Francis J. Aguilar. The DESTEP analysis groups external factors into six categories: demographic, economic, socio-cultural, technological, ecological, and political.

STEEP Analysis

The STEEP analysis is a tool used to map the external factors that impact an organization. STEEP stands for the five key areas on which the analysis focuses: socio-cultural, technological, economic, environmental/ecological, and political. Usually, the STEEP analysis is complementary or alternative to other methods such as SWOT or PESTEL analyses.

STEEPLE Analysis

The STEEPLE analysis is a variation of the STEEP analysis. Where the step analysis comprises socio-cultural, technological, economic, environmental/ecological, and political factors as the base of the analysis. The STEEPLE analysis adds other two factors such as Legal and Ethical.

Activity-Based Management

Activity-based management (ABM) is a framework for determining the profitability of every aspect of a business. The end goal is to maximize organizational strengths while minimizing or eliminating weaknesses. Activity-based management can be described in the following steps: identification and analysis, evaluation and identification of areas of improvement.

PMESII-PT Analysis

PMESII-PT is a tool that helps users organize large amounts of operations information. PMESII-PT is an environmental scanning and monitoring technique, like the SWOT, PESTLE, and QUEST analysis. Developed by the United States Army, used as a way to execute a more complex strategy in foreign countries with a complex and uncertain context to map.

SPACE Analysis

The SPACE (Strategic Position and Action Evaluation) analysis was developed by strategy academics Alan Rowe, Richard Mason, Karl Dickel, Richard Mann, and Robert Mockler. The particular focus of this framework is strategy formation as it relates to the competitive position of an organization. The SPACE analysis is a technique used in strategic management and planning. 

Lotus Diagram

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Functional Decomposition

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Multi-Criteria Analysis

The multi-criteria analysis provides a systematic approach for ranking adaptation options against multiple decision criteria. These criteria are weighted to reflect their importance relative to other criteria. A multi-criteria analysis (MCA) is a decision-making framework suited to solving problems with many alternative courses of action.

Stakeholder Analysis

A stakeholder analysis is a process where the participation, interest, and influence level of key project stakeholders is identified. A stakeholder analysis is used to leverage the support of key personnel and purposefully align project teams with wider organizational goals. The analysis can also be used to resolve potential sources of conflict before project commencement.

Strategic Analysis

Strategic analysis is a process to understand the organization’s environment and competitive landscape to formulate informed business decisions, to plan for the organizational structure and long-term direction. Strategic planning is also useful to experiment with business model design and assess the fit with the long-term vision of the business.

Related Strategy Concepts: Go-To-Market StrategyMarketing StrategyBusiness ModelsTech Business ModelsJobs-To-Be DoneDesign ThinkingLean Startup CanvasValue ChainValue Proposition CanvasBalanced ScorecardBusiness Model CanvasSWOT AnalysisGrowth HackingBundlingUnbundlingBootstrappingVenture CapitalPorter’s Five ForcesPorter’s Generic StrategiesPorter’s Five ForcesPESTEL AnalysisSWOTPorter’s Diamond ModelAnsoffTechnology Adoption CurveTOWSSOARBalanced ScorecardOKRAgile MethodologyValue PropositionVTDF FrameworkBCG MatrixGE McKinsey MatrixKotter’s 8-Step Change Model.

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