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Using Stakeholder Analysis in Software Project Management

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Every software professional that has been part of more than one project knows for sure:no two projects are the same. Different circumstances make most software projects unique in several aspects. And with different situations come different approaches to handle project life effectively: there are mutliple ways to “do” a project. Different circumstances require different approaches.

Although a project is to a large part defined by the required end results and technologyused, the main determining factor of what makes a project different from another is people.The entire process of software project management is strongly stakeholder-driven. It’stheir wishes, fears, dreams—their stakes—that determine the course of the project. Youhave to handle a project to really grasp the impact of people on your endeavor. You haveto “live” a project to know the force of political games and power trips. You have to lead ateam to deliver a project under time pressures to appreciate the constructive power ofmotivated people or the destructive power of demotivated team members.


In a project, it’s the people that are the main cause of problems. Time schedules, financialprojections, and software goals may be abstractions, but it’s the flesh-and-blood peoplewhose work determines your project’s status. It’s the programmer that misses a deadlineand holds up everyone else, it’s the financial manager that goes berserk if you can’tproduce some good budgetary indications, and it’s the key user that doesn’t give a darnbut didn’t tell you about his dismal lack of motivation; these are the folks who can causeserious trouble.


Stakeholders and the Software Project Manager’s Problem

So, as a software project manager, you should really focus on the stakeholders. You should be guided by their fears and their wishes. A stakeholder can be a project teammember, an employee of the user organization, or a senior manager. It can be virtuallyanyone, as long as that person has something to do with the project.Here is the central problem the software manager is faced with, appropriately named “thesoftware project manager’s problem,” as explained by Barry W. Boehm and Rony Ross (Boehm, Barry W. and Rony Ross. “Theory-W Software Project Management Principles and examples.” IEEE Transactions on Software Engineering. 15.7 (1989): 902-916).

They believe that everyone affected by the project, directly or indirectly, has something tosay, again directly or indirectly, and will do so. All of them want to get the best from thisproject for themselves personally or for their organization. It’s the job of the softwareproject manager to see that everyone gets what he or she wants, in one way or another.He has to “make everyone a winner.”

Of course, this is easier said than done. You have to act like a psychoanalyst and get intouch with everyone’s deeper feelings. Most technical project leaders would be running forthe door at this moment. To make it less fuzzy, we can attach some project management lingo to it:

“The project manager can use stakeholder analysis to determine the stakes andexpectations of the stakeholders, and adopt the project organization and feedback mechanisms according to the desired outcomes.”

Expectations, Interests and Requirements

Stakeholder analysis is a technique to identify and analyze the stakeholders surrounding aproject. It provides information on stakeholders and their relationships, interests, andexpectations. A proper analysis of the stakeholders will help you to construct a projectapproach suited to the situation and will allow you to negotiate better with thestakeholders.

What people (and therefore your project stakeholders) really, really, really want is whatcan be termed their interests or, as I sometimes call them, their stakes (hence the name“stakeholder”). With fears there is a stake to lose, and with wishes there is something togain.

In this context, I consider interests as the aspects that drive people. Before you startdrawing your “interest evaluation diagram” or some other tool or technique, be aware thatin general these interests are hardly ever communicated. It’s pure mind stuff, all inside thehead of the owner. A four-year-old boy may share his true interests with you, but the fiftyyear-old graying accountant will tell you nothing.

If no one will tell you anything, what is the point? People will tell you something if you askthem. They will tell you they want an ice cream cone, a new hyperspeed Internet uplink, ora new financial software package. In essence, they tell you what they expect. It is astatement created by themselves about a desired situation: their expectations.

If I emphasize that expectations are a one-sided communication, then there must besomething else as well; enter requirements. Requirements are a set of statementsnegotiated among a group of people. They can be the original expectations, if all agree onthe statement itself, but more often than not, requirements consist of some consensus ofconflicting expectations.

It sounds simple, but getting the expectations is one thing and discovering theircorresponding stakes is another. Why bother anyway? What is it worth? A lot. You can’teffectively change the stakes, but you can alter the set of requirements as long as the newrequirements continue to support the stakes. In this way, there is room to negotiate a setof requirements for the project that poses no conflict, matches the stakes, and thus makeseveryone a winner!

Consider this example: a stakeholder formulates an expectation for the software project;for example, senior management states that “The project should be finished before theend of August.” The project manager then has to deal with this time frame. When thisdeadline is no problem, he can rest assured; however, it’s a software project, so thedeadline typically will be a problem. The way to handle it is to get some information on thestakes that prompted this requirement to be formulated in the first place.

Perhaps it’s the old “I don’t want to lose face when my projects get delayed” concern. Thatbeing the case, the project manager can offer alternatives that don’t violate the stake, likekeeping the deadline but postponing a subsystem. Chances are good that alternativerequirements that keep supporting the stakes will be accepted—maybe not easily, but

project managers should do something to earn their money.

So, it seems to be valuable to dig deeper into the souls of your stakeholders. It sounds allvery misty and cloudy, but keep remembering why you must do it:

  • Expectations are assessable and can be influenced. However, you should stay true to the interests of people; they will determine the amount of leverage you have to change the expectations without setting a stakeholder on the warpath.
  • Requirements have to stay in line with what people are expecting. If stakeholders find out the requirements don’t fit their expectations, you have a major problem.
  • Knowledge about the stakeholders and their expectations and interests helps you shape the project organization (structure, authority, and responsibility).
  • It’s a very good risk analysis strategy to see where the potential problems will be.

Stakeholder Analysis

The actual steps for a stakeholder analysis are:

  • Stakeholder identification
  • Stakeholder expectations and interests
  • Stakeholder influence and role in the project

Stakeholder Identification

This first step is concerned with the question “Who are the stakeholders?” For this, youbasically draw maps of people or groups and their relationships. You start with two nameson a whiteboard and before you know it, you are drawing on the walls.


Stakeholder Expectations and Interests

The more difficult step is this one; here we get the socio-psycho stuff. For expectations it isfairly straightforward: just ask. You can ask in person or via mail or email. Create somevariations on the question, so that it is not too obvious what you are trying to find out.

Stakeholder interests are another thing. Trying to elicit their interests is always guesswork,deducting them from other information. For this, there are two types of approaches: (1)using a checklist to assist your thinking about the stakeholder and (2) plotting people insmall models that help determine the way to approach them.

For the first type, consider a list with questions like: “Is he satisfied with his current job?”,“Is he covering up his own incompetence?” and “Does he want a bigger office?” Thinkingabout these questions help you build an image of the person’s interests.

Using small models, the second type, can be easier than it sounds. For this, you have toplot a stakeholder in a dimension, and by doing that, you get an idea of how to approachthe stakeholder. Dimensions can include: “How much in favor of the project”, “Process orContent-oriented” and “Group or Individual-oriented.”


Stakeholder Influence and Role in the Project

The insights about the stakeholders will assist us also to construct the project organization:

  • Do we have to include the stakeholders in the organization?
  • If so, is it wise to grant stakeholders great influence or should we give them positions where they can do no harm?
  • How can we construct stakeholders’ job descriptions in such a way that they are as motivated as possible?

What Does This Bring The Project Manager?

In the end, what does all this analyzing and guessing bring to us? That’s a good question,and here’s the answer:

  1. A list of all the stakeholders
  2. An idea about each stakeholder’s relative importance and influence
  3. Insight into what stakeholders want out of the project
  4. Insight into what makes stakeholders tick
  5. An idea about whether stakeholders will work against or for the project

Apart from an improved ability to negotiate better requirements-sets, this information provides the basis for two major project management tools: the project organization (mentioned as the last step of stakeholder analysis) and the feedback mechanisms.


Feedback mechanisms

If stakeholders provide requirements to a project, they are very interested to know what happens to them. Are they going to be met, or will they be ignored? Keeping your stakeholders in the loop, reassuring your stakeholders about what is happening with their stakes/requirements is a smart thing to do.

There are a lot of project management techniques and artifacts available just for the purpose of feedback. Often, it is unclear from the methods that you use what is the purpose of the feedback. In the list below are some artefact samples that are common in most methods, and what kind of feedback each provides.

Requirements definition Feedback to the users how their requirements are noted after talking, analyzing and negotiation
Functional design Feedback to the user how their requirements are translated to a new system
Prototype Feedback to the user how their requirements are translated to a new system
Schedule Feedback on constraint "time"
Budget Feedback on constraint "cost"






Every improvement you make with the goal of improving your ability to do projects better should involve how to handle the human element more effectively, as this is the area where we can realize the biggest gains.


Stakeholder analysis is one technique that can assist in this. To sharpen your knife you can improve your senstivety in this area, create your own checklists and read up on the various models available to you. Finally, just being aware of stakes and their effects on your project in itself is a huge benefit to your software project management efforts.



Bas De Baar works as a Project Manager within the publishing industry. Since 2001, he has been the editor of , a popular website dedicated to Software Project Management. He holds a masters degree in Business Informatics and currently lives with his wife in the coastal town of Zandvoort, The Netherlands. His latest book, “Surprise! Now You’re a Software Project Manager”, was published in September 2006 and is available from or from most book retailers. Mr. De Baar can be reached at



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