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Stakeholder Engagement

Stakeholder Engagement

Stakeholder EngagementThe story of stakeholder engagement is a familiar one.

The term stakeholder starts as a new coinage. It becomes a word of art, understood by a select few. It then takes on a very public persona, widely used and at the heart of public discourse.

So managers seek to manage their stakeholders because it’s what they do. That’s their nature. Until we start to realise the category error that represents. And so, a gentle revolution brings us to today, and stakeholder engagement.

That’s the story we need to tell.

Why Engage with Stakeholders?

Stakeholders are everywhere.They are everyone who has an interest in what you are doing. An organisation’s stakeholders are everyone of the people whose lives intersect or touch upon your organisation.

So, to put it bluntly, you can engage them, or you can remain aloof, pretending to be detached. But since that mismatches reality, there are likely to be consequences, and history shows they can be dire. Shell’s experience with its Brent Spar oil drilling platform is a signal case.

What is Stakeholder Engagement?

Before we can understand stakeholder engagement, we need to understand stakeholder. In the early 1990s, it was a term few people had heard.

What is a Stakeholder?

We’ll start with the definition of stakeholders from ‘The Influence Agenda’ (US|UK), my own book about stakeholder engagement in the context of projects and organisational change.

Stakeholder: Anyone who has any interest in what you are doing

In writing the book, I did some research into the origin of that word, and found a fascinating history…

The Origin of Stakeholders
The Origin of Stakeholders

Definition of Stakeholder Engagement

Stakeholder engagement is the total of every approach you take to communicate with your stakeholders. It includes informal and formal communication, and communication in each direction. Whether you choose to influence or inform, or be subject to the ideas and opinions of your stakeholders, you need to engage them.

In words a five year old would understand, it’s:

talking to people

The Terminology of Stakeholder Engagement

When I started learning about stakeholder engagement, that wasn’t what it was called. We called it Stakeholder Management. But, as the 1990s gave way to the 2000s, people increasingly started to realise that it’s just rude for an organisation to try to manage people who don’t work for it, have no contract with it, and upon whose good will it is partially dependent.

By the early 2010s, the shift in language was well underway in many places. We now talk about Stakeholder Engagement. We don’t publicly seek to manage people any more than we would dare to call it stakeholder manipulation or stakeholder handling. Even the highly conservative Project Management Institute (PMI) recently started the switch in terminology, with its 2017 6th Edition of the Project Management Body of Knowledge (PMBOK) (US|UK).

Now, I prefer to use the term ‘stakeholder engagement’ for communicating with stakeholders, and ‘stakeholder engagement management’ for the process of managing that communication.

How to Manage Stakeholder Engagement

The Stakeholder Engagement process has five components.

Stakeholder Engagement Process
Stakeholder Engagement Process

Identify your Stakeholders

You can’t do anything unless you know who your stakeholders are. The most important tip is to open your net as widely as possible, so as to not exclude any potential stakeholder. They may not have much consequence, but ignoring people is dangerous – whether by design or by mission.

Analyse your Stakeholders

Now you need to understand each of your stakeholders. There are lots of facets to this and tools you can use. But the key elements are the

  • extent of their stake
  • depth of their feelings
  • power they have to influence your choices or their outcomes

This last point reminds me of a humorous (but telling) definition of a stakeholder as:

anyone who can spoil your day

Plan your Engagement Campaign

Now it’s time to put together a plan for how you’ll engage each of your stakeholders. You’ll be thinking about things like:

  • the messages you want to convey
  • your attitude and approach
  • the medium you’ll use
  • timing and frequency

Act: Engage your Stakeholders

This is the actual stakeholder engagement part. Whether you are informing or influencing, consulting or commanding, requesting or requiring, the essential skill is listening. It isn’t engagement if you don’t care about their perceptions.

Review the Impact of your Engagement

Any form of communication creates a feedback loop of speak and listen. Likewise, your stakeholder engagement campaign needs constant monitoring and review, to keep it current and effective. This means being prepared to revise your earlier analysis, overhaul your plans, and even supplement your list of stakeholders.

Even in a short and small project, stakeholder engagement is never a one-shot process. For an organisation engaging its stakeholders, it is a continuous and endless part of business as usual.

Redefining the Corporation

This truth became apparent to large businesses in the late 1980s. At the same time, they also realised that big businesses had moral and social responsibilities as well as their economic responsibilities.

They founded the Caux Round Table for Moral Capitalism which issued its code of business ethics, the Caux Principles, in 1994.

These principles set out how corporations should treat their stakeholders and are accompanied by a set of stakeholder management guidelines (remember the date – management, rather than engagement, in the 1990s).

We don’t have the space here to look at these principles in detail, but I do commend them to you. If you ever find yourself with a responsibility for how your organisation – large or small – talks to people within or outside itself, ¬†these are vital reading.

What is Your experience of Stakeholder Engagement?

We’d love to hear your experiences, ideas, and questions. Please leave them in the comments below.

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