Stakeholder Management as a Contractor - Revision history

Tkokotas at 15:39, 18 December 2018

2018-12-18T15:39:13Z

← Older revision		Revision as of 15:39, 18 December 2018
Line 1:		Line 1:
			''Developed by Elizabeth Lindhard Moe''


	A stakeholder is an entity that can affect a project or be affected by the project itself; this means that a stakeholder may have an interest in the outcome and/or the management of a project. Therefore stakeholder management is essential for project, program and/or portfolio management. Managing stakeholders includes identifying, analysing and mapping the stakeholders. Once the stakeholders have been identified and mapped, they can be managed and engaged accordingly.		A stakeholder is an entity that can affect a project or be affected by the project itself; this means that a stakeholder may have an interest in the outcome and/or the management of a project. Therefore stakeholder management is essential for project, program and/or portfolio management. Managing stakeholders includes identifying, analysing and mapping the stakeholders. Once the stakeholders have been identified and mapped, they can be managed and engaged accordingly.

113129 at 10:45, 29 September 2015

2015-09-29T10:45:26Z

113129: /* Table 1: Example of Project Stakeholders */

2015-09-28T20:05:27Z

Table 1: Example of Project Stakeholders

← Older revision		Revision as of 20:05, 28 September 2015
Line 42:		Line 42:
	The internal stakeholders can be categorized around the client as wither the ''demand'' side or the ''supply'' side. The external stakeholders can, likewise, be broken down into ''private'' and ''public'' actors. An example of possible stakeholders within the various categories can be seen below<ref name="Graham"/>:		The internal stakeholders can be categorized around the client as wither the ''demand'' side or the ''supply'' side. The external stakeholders can, likewise, be broken down into ''private'' and ''public'' actors. An example of possible stakeholders within the various categories can be seen below<ref name="Graham"/>:

	==== Table 1: Example of Project Stakeholders ====		==== Table 1: Example of Project Stakeholders<ref name="Graham"/> ====
	{\| class="wikitable"		{\| class="wikitable"
	! colspan="2" style="font-weight: bold;" \| Internal Stakeholders		! colspan="2" style="font-weight: bold;" \| Internal Stakeholders

113129: /* Analysis Process */

2015-09-28T20:04:59Z

Analysis Process

← Older revision		Revision as of 20:04, 28 September 2015
Line 38:		Line 38:
	The stakeholders of a project are actors which will incur a direct benefit or loss from the finished project. As a construction project can both create and destroy value, it is important to analyse the various stakeholders that may have an interest in the project. Often it is useful to categorize stakeholders into ''internal'' and ''external'' stakeholders:		The stakeholders of a project are actors which will incur a direct benefit or loss from the finished project. As a construction project can both create and destroy value, it is important to analyse the various stakeholders that may have an interest in the project. Often it is useful to categorize stakeholders into ''internal'' and ''external'' stakeholders:
	* '''Internal Stakeholders:''' These are in legal contract with the client. Examples: The main contractor, turnkey contractors, traders.		* '''Internal Stakeholders:''' These are in legal contract with the client. Examples: The main contractor, turnkey contractors, traders.
	* '''External Stakeholders:''' These are not in contract with the client, but have an interest in the outcome of the project. ~~Example~~: The government, the public.		* '''External Stakeholders:''' These are not in contract with the client, but have an interest in the outcome of the project. Examples: The government, the public.

	The internal stakeholders can be categorized around the client as wither the ''demand'' side or the ''supply'' side. The external stakeholders can, likewise, be broken down into ''private'' and ''public'' actors. An example of possible stakeholders within the various categories can be seen below<ref name="Graham"/>:		The internal stakeholders can be categorized around the client as wither the ''demand'' side or the ''supply'' side. The external stakeholders can, likewise, be broken down into ''private'' and ''public'' actors. An example of possible stakeholders within the various categories can be seen below<ref name="Graham"/>:

113129 at 20:03, 28 September 2015

2015-09-28T20:03:42Z

← Older revision		Revision as of 20:03, 28 September 2015
Line 1:		Line 1:
	A stakeholder is an entity that can affect a project or be affected by the project itself; ~~thus~~ a stakeholder may have an interest in the outcome and the management of a project. Therefore stakeholder management is essential for project, program and/or portfolio management. Managing stakeholders includes identifying, analysing and mapping the stakeholders. Once the stakeholders have been identified and mapped, they can be managed and engaged accordingly.		A stakeholder is an entity that can affect a project or be affected by the project itself; this means that a stakeholder may have an interest in the outcome and/or the management of a project. Therefore stakeholder management is essential for project, program and/or portfolio management. Managing stakeholders includes identifying, analysing and mapping the stakeholders. Once the stakeholders have been identified and mapped, they can be managed and engaged accordingly.

	This article aims to discuss the crucial concept of managing your stakeholders in a construction project, and will reflect on the principles and methods used in both contracting and in '''supply chain management (SCM)'''. The article will draw parallels between SCM and contracting concepts, finding similarities, limits and differences from a contracting perspective. The purpose of this article is to analyse the stakeholder management when '''contracting''' a large construction program, and reflect upon the similar methods used when managing a supply chain within an organisation.		This article aims to discuss the crucial concept of managing your stakeholders in a construction project, and will reflect on the principles and methods used in both contracting and in '''supply chain management (SCM)'''. The article will draw parallels between SCM and contracting concepts, finding similarities, limits and differences from a contracting perspective. The purpose of this article is to analyse the stakeholder management when '''contracting''' a large construction program, and reflect upon the similar methods used when managing a supply chain within an organisation.

113129 at 17:31, 28 September 2015

2015-09-28T17:31:20Z

← Older revision		Revision as of 17:31, 28 September 2015
Line 85:		Line 85:

	== Managing Stakeholders in Supply Chain Management ==		== Managing Stakeholders in Supply Chain Management ==
	A supply chain manager should also manage his stakeholders, although they may differ from the construction stakeholders. Where contracting uses more general methods, such as the power/influence-grid, the supply chain manager often uses a different method. When managing the stakeholders of a Supply Chain, there are often six key principles to be followed. The general methodology of stakeholder management within the supply chain is constant, as the a supply chain is not a single project, but represents a portfolio of projects. This means, that a supply chain may have hundreds of stakeholders to manage at all times.		A supply chain manager should also manage his stakeholders, although they may differ from the construction stakeholders. Where contracting uses more general methods, such as the power/influence-grid, the supply chain manager often uses a different method. When managing the stakeholders of a Supply Chain, there are often six key principles to be followed. The general methodology of stakeholder management within the supply chain is constant, as the supply chain is not a single project, but represents a portfolio of projects. This means, that a supply chain may have hundreds of stakeholders to manage at all times.

	'''The six principles (6P)''' of stakeholder management in a supply chain are:<ref name="Sharma">Sharma, Raj. 2008. ''The 6 Principles of Stakeholder Engagement.'' Reed Business Information.</ref>		'''The six principles (6P)''' of stakeholder management in a supply chain are:<ref name="Sharma">Sharma, Raj. 2008. ''The 6 Principles of Stakeholder Engagement.'' Reed Business Information.</ref>

113129 at 17:30, 28 September 2015

2015-09-28T17:30:47Z

← Older revision		Revision as of 17:30, 28 September 2015
Line 95:		Line 95:
	* 6. '''Creating Communities:''' Sharing information and best practices across the organisation.		* 6. '''Creating Communities:''' Sharing information and best practices across the organisation.

	In SCM, the organisation is often ''scanned'' in order to find the various stakeholders both within the organisation and outside the organisations. Such scans are called ''vertical'' scans, ''~~horisontal~~'' scans and ''external'' scans<ref name="Sharma"/>. The vertical scan looks up and down the hierarchy of the organisation and the chain, searching for stakeholders at each level. The ~~horisontal~~ scan searches through different departments within the organisation and the chain. The external scan searches for forces from the outside, like government or NGOs that may have an interest in the project. The stakeholder analysis of a supply chain consists of a thorough scan through the organisation and the chain, and afterwards the communication between the different nodes and the client begins. The supply chain relies strongly on the communication and it is expected that a common communication channel is to be used. Often various '''Enterprise resource planning (ERP)''' systems are used in order to establish a consistent communication channel between the stakeholders and the client.		In SCM, the organisation is often ''scanned'' in order to find the various stakeholders both within the organisation and outside the organisations. Such scans are called ''vertical'' scans, ''horizontal'' scans and ''external'' scans<ref name="Sharma"/>. The vertical scan looks up and down the hierarchy of the organisation and the chain, searching for stakeholders at each level. The horizontal scan searches through different departments within the organisation and the chain. The external scan searches for forces from the outside, like government or NGOs that may have an interest in the project. The stakeholder analysis of a supply chain consists of a thorough scan through the organisation and the chain, and afterwards the communication between the different nodes and the client begins. The supply chain relies strongly on the communication and it is expected that a common communication channel is to be used. Often various '''Enterprise resource planning (ERP)''' systems are used in order to establish a consistent communication channel between the stakeholders and the client.

	=== Limitations of SCM 6P ===		=== Limitations of SCM 6P ===

113129 at 17:29, 28 September 2015

2015-09-28T17:29:54Z

← Older revision		Revision as of 17:29, 28 September 2015
Line 82:		Line 82:
	=== Limitations of Stakeholder Management ===		=== Limitations of Stakeholder Management ===
	The process of analysing and mapping stakeholders is usually made prior to or in the beginning of a project, program or portfolio. As a construction project often stretches over a long period of time, it is very likely that some of the stakeholders change attitude during the project, some stakeholders may disappear, or even new stakeholders may occur. For instance, a loud local resident may move away from the construction site, the government might state a new law that affects the construction progress, or the client or the management contractor is bought by a larger company. This limits the functionality of stakeholder mapping, as it should be updated continuously if and when changes happen both internally and externally to the project. Managing stakeholders whose attitudes are changing or whose interest and/or power suddenly shift, can be a challenge that the stakeholder analysis might not have prepared the client for.		The process of analysing and mapping stakeholders is usually made prior to or in the beginning of a project, program or portfolio. As a construction project often stretches over a long period of time, it is very likely that some of the stakeholders change attitude during the project, some stakeholders may disappear, or even new stakeholders may occur. For instance, a loud local resident may move away from the construction site, the government might state a new law that affects the construction progress, or the client or the management contractor is bought by a larger company. This limits the functionality of stakeholder mapping, as it should be updated continuously if and when changes happen both internally and externally to the project. Managing stakeholders whose attitudes are changing or whose interest and/or power suddenly shift, can be a challenge that the stakeholder analysis might not have prepared the client for.
	A solution for these limitations could be to incorporate the possible influences of the ~~stakeholdes~~ within the map. If a stakeholder is often influenced by an external force, then this force should be taken into account by the management contractor as well. This would result in larger and more complex stakeholder maps, with connecting nodes displaying interdependencies and independencies. In other words, by incorporating the potential supply chains or influential network of the stakeholders, it could be possible to predict and act upon sudden changes in the analysis and the stakeholder map. For a more detailed solution of an improved stakeholder mapping method, the following article is recommended: [[Stakeholders from a dynamic and network perspective]].		A solution for these limitations could be to incorporate the possible influences of the stakeholders within the map. If a stakeholder is often influenced by an external force, then this force should be taken into account by the management contractor as well. This would result in larger and more complex stakeholder maps, with connecting nodes displaying interdependencies and independencies. In other words, by incorporating the potential supply chains or influential network of the stakeholders, it could be possible to predict and act upon sudden changes in the analysis and the stakeholder map. For a more detailed solution of an improved stakeholder mapping method, the following article is recommended: [[Stakeholders from a dynamic and network perspective]].

	== Managing Stakeholders in Supply Chain Management ==		== Managing Stakeholders in Supply Chain Management ==

113129: /* Power/Interest Matrix */

2015-09-28T17:28:57Z

Power/Interest Matrix

← Older revision		Revision as of 17:28, 28 September 2015
Line 78:		Line 78:
	Finally, the stakeholders in the ''manage closely''-category are the key players, such as financiers, the client, and even the management contractor. They all have strong power and very high interest in the project, and should all be managed closely during the duration of the project/program.		Finally, the stakeholders in the ''manage closely''-category are the key players, such as financiers, the client, and even the management contractor. They all have strong power and very high interest in the project, and should all be managed closely during the duration of the project/program.

	For an in-depth explanation of other methods used for Stakeholder Management, the following article is recommended: [[Stakeholder Analysis]]		For an in-depth explanation of other methods used for Stakeholder Management, the following article is recommended: [[Stakeholder Analysis]].

	=== Limitations of Stakeholder Management ===		=== Limitations of Stakeholder Management ===

113129 at 17:27, 28 September 2015

2015-09-28T17:27:07Z

← Older revision		Revision as of 17:27, 28 September 2015
Line 64:		Line 64:
	In construction projects, the managing contractor often maps the stakeholders in a '''Winch-Bonke framework'''<ref name="Graham">Winch, Graham M.. 2010. ''Managing Construction Projects, 2nd ed.'' Wiley-Blackwell.</ref>. This map focuses on the project mission, and stakeholders can be considered to have a problem with the mission, and to have a solution that will resolve the problem. If the solution is inconsistent with the client's or the main contractor's wishes, then the stakeholders can be defined as being in opposition to the project for as long as the problem is valid. The managing constructor should seek to turn opponents into supporters. This can be done by offering appropriate changes to the project mission, ensuring that both the stakeholder and the client are satisfied. At the same time, the managing contractor should ensure that supporters do not turn into opponents by offering to incorporate their proposed problem solutions.		In construction projects, the managing contractor often maps the stakeholders in a '''Winch-Bonke framework'''<ref name="Graham">Winch, Graham M.. 2010. ''Managing Construction Projects, 2nd ed.'' Wiley-Blackwell.</ref>. This map focuses on the project mission, and stakeholders can be considered to have a problem with the mission, and to have a solution that will resolve the problem. If the solution is inconsistent with the client's or the main contractor's wishes, then the stakeholders can be defined as being in opposition to the project for as long as the problem is valid. The managing constructor should seek to turn opponents into supporters. This can be done by offering appropriate changes to the project mission, ensuring that both the stakeholder and the client are satisfied. At the same time, the managing contractor should ensure that supporters do not turn into opponents by offering to incorporate their proposed problem solutions.

	Mapping the stakeholders is often done before the initiation of the project or program, as the map may uncover some unnecessarily un-cooperative stakeholders. If that is the case, then the management contractor should try to mediate with the stakeholder or, in rare and/or extreme cases, should try to remove the stakeholder if possible, by finding a replacement elsewhere. The map itself may prove useful throughout the project, as it can be used to determine and predict the reactions and ~~actings~~ of the stakeholders in various scenarios.		Mapping the stakeholders is often done before the initiation of the project or program, as the map may uncover some unnecessarily un-cooperative stakeholders. If that is the case, then the management contractor should try to mediate with the stakeholder or, in rare and/or extreme cases, should try to remove the stakeholder if possible, by finding a replacement elsewhere. The map itself may prove useful throughout the project, as it can be used to determine and predict the reactions and actions of the stakeholders in various scenarios.

	=== Power/Interest Matrix ===		=== Power/Interest Matrix ===

← Older revision		Revision as of 10:45, 29 September 2015
Line 8:		Line 8:
	As companies often aim to be succesful, they will seek to achieve a position in the market, where they can offer both a cost advantage and a value/service advantage. As seen on the '''logistics and competitive advantage matrix'''<ref name="Christopher"/>, it is suggested to have a Cost and Service Leader in order to achieve a competitive advantage in the market. In construction management, the cost and service leader may be responsible for developing a fitting bid for a project, and ensuring that during the project the value created meets the expectations of the client. Obtaining both cost leadership and service leadership, will put an organisation in a leading position within the market. To accomplish this, it is often critical to have an experienced project or program manager leading big projects. Such a leader will often be a management contractor, and he will be responsible for the subcontractors and the flow of resources.		As companies often aim to be succesful, they will seek to achieve a position in the market, where they can offer both a cost advantage and a value/service advantage. As seen on the '''logistics and competitive advantage matrix'''<ref name="Christopher"/>, it is suggested to have a Cost and Service Leader in order to achieve a competitive advantage in the market. In construction management, the cost and service leader may be responsible for developing a fitting bid for a project, and ensuring that during the project the value created meets the expectations of the client. Obtaining both cost leadership and service leadership, will put an organisation in a leading position within the market. To accomplish this, it is often critical to have an experienced project or program manager leading big projects. Such a leader will often be a management contractor, and he will be responsible for the subcontractors and the flow of resources.

	Flow of products, supplies, information, and resources is essential in order to successfully create and plan a project. Logistics provide a solid framework for flow-based plans, such as manufacturing and development facilities. '''Supply Chain Management (SCM)''' builds upon this framework, and ''"seeks to manage upstream and downstream relationships with suppliers and the client, in order to achieve enhanced value in the final market with less cost to the supply chain as a whole."''<ref name="Christopher">Christopher, Martin. 2011. ''Logistics & Supply Chain Management, 4th ed.'' Pearson.</ref> The goal of supply chain management differs from chain to chain, but it could include a wish to reduce buffers in warehousing, by sharing information and co-ordinating the suppliers. The focus of a supply chain is to establish co-operation and trust between suppliers and clients, in order to optimize the final output.		Flow of products, supplies, information, and resources is essential in order to successfully create and plan a project. Logistics provide a solid framework for flow-based plans, such as manufacturing and development facilities. '''Supply Chain Management (SCM)''' builds upon this framework, and ''"seeks to manage upstream and downstream relationships with suppliers and the client, in order to achieve enhanced value in the final market with less cost to the supply chain as a whole."''<ref name="Christopher">Christopher, Martin. 2011. ''Logistics & Supply Chain Management, 4th ed.'' Pearson. A book describing in detail logistics and supply chain management (among other things).</ref> The goal of supply chain management differs from chain to chain, but it could include a wish to reduce buffers in warehousing, by sharing information and co-ordinating the suppliers. The focus of a supply chain is to establish co-operation and trust between suppliers and clients, in order to optimize the final output.

	=== The Management Contractor ===		=== The Management Contractor ===
	A '''management contractor''' (main contractor, general contractor) is responsible for the coordination of the construction project, and will oversee the daily progress at the site. The contractor will manage and be responsible for '''turnkey -''', '''main -''', and '''individual trade contracts'''<ref name="handbook">''Handbook: For project and construction management - Fundamental concepts'' ''by Københavns Erhvervsakademi and VIA University College''</ref>, and ensure communication between suppliers, traders and the client throughout the course of the project.		A '''management contractor''' (main contractor, general contractor) is responsible for the coordination of the construction project, and will oversee the daily progress at the site. The contractor will manage and be responsible for '''turnkey -''', '''main -''', and '''individual trade contracts'''<ref name="handbook">''Handbook: For project and construction management - Fundamental concepts'' ''by Københavns Erhvervsakademi and VIA University College'' A handbook for contractors, describing the different types of contracts and contractors.</ref>, and ensure communication between suppliers, traders and the client throughout the course of the project.

	* '''Turnkey Contracts:''' A turnkey project is a project that is fully functional upon delivery. Thus a turnkey contract is a project that the subcontractor will be fully responsible for, and he ''"turns over the keys"'' to the main contractor once the subcontractors job is done..		* '''Turnkey Contracts:''' A turnkey project is a project that is fully functional upon delivery. Thus a turnkey contract is a project that the subcontractor will be fully responsible for, and he ''"turns over the keys"'' to the main contractor once the subcontractors job is done..
Line 62:		Line 62:
	=== Mapping Stakeholders ===		=== Mapping Stakeholders ===
	[[File:Winch-Bonke.png\|thumb\|300px\|A Winch-Bonke stakeholder framework<ref name="Graham"/>.]]		[[File:Winch-Bonke.png\|thumb\|300px\|A Winch-Bonke stakeholder framework<ref name="Graham"/>.]]
	In construction projects, the managing contractor often maps the stakeholders in a '''Winch-Bonke framework'''<ref name="Graham">Winch, Graham M.. 2010. ''Managing Construction Projects, 2nd ed.'' Wiley-Blackwell.</ref>. This map focuses on the project mission, and stakeholders can be considered to have a problem with the mission, and to have a solution that will resolve the problem. If the solution is inconsistent with the client's or the main contractor's wishes, then the stakeholders can be defined as being in opposition to the project for as long as the problem is valid. The managing constructor should seek to turn opponents into supporters. This can be done by offering appropriate changes to the project mission, ensuring that both the stakeholder and the client are satisfied. At the same time, the managing contractor should ensure that supporters do not turn into opponents by offering to incorporate their proposed problem solutions.		In construction projects, the managing contractor often maps the stakeholders in a '''Winch-Bonke framework'''<ref name="Graham">Winch, Graham M.. 2010. ''Managing Construction Projects, 2nd ed.'' Wiley-Blackwell. A book describing the work of contractors as project managers in the construction industry</ref>. This map focuses on the project mission, and stakeholders can be considered to have a problem with the mission, and to have a solution that will resolve the problem. If the solution is inconsistent with the client's or the main contractor's wishes, then the stakeholders can be defined as being in opposition to the project for as long as the problem is valid. The managing constructor should seek to turn opponents into supporters. This can be done by offering appropriate changes to the project mission, ensuring that both the stakeholder and the client are satisfied. At the same time, the managing contractor should ensure that supporters do not turn into opponents by offering to incorporate their proposed problem solutions.

	Mapping the stakeholders is often done before the initiation of the project or program, as the map may uncover some unnecessarily un-cooperative stakeholders. If that is the case, then the management contractor should try to mediate with the stakeholder or, in rare and/or extreme cases, should try to remove the stakeholder if possible, by finding a replacement elsewhere. The map itself may prove useful throughout the project, as it can be used to determine and predict the reactions and actions of the stakeholders in various scenarios.		Mapping the stakeholders is often done before the initiation of the project or program, as the map may uncover some unnecessarily un-cooperative stakeholders. If that is the case, then the management contractor should try to mediate with the stakeholder or, in rare and/or extreme cases, should try to remove the stakeholder if possible, by finding a replacement elsewhere. The map itself may prove useful throughout the project, as it can be used to determine and predict the reactions and actions of the stakeholders in various scenarios.
Line 87:		Line 87:
	A supply chain manager should also manage his stakeholders, although they may differ from the construction stakeholders. Where contracting uses more general methods, such as the power/influence-grid, the supply chain manager often uses a different method. When managing the stakeholders of a Supply Chain, there are often six key principles to be followed. The general methodology of stakeholder management within the supply chain is constant, as the supply chain is not a single project, but represents a portfolio of projects. This means, that a supply chain may have hundreds of stakeholders to manage at all times.		A supply chain manager should also manage his stakeholders, although they may differ from the construction stakeholders. Where contracting uses more general methods, such as the power/influence-grid, the supply chain manager often uses a different method. When managing the stakeholders of a Supply Chain, there are often six key principles to be followed. The general methodology of stakeholder management within the supply chain is constant, as the supply chain is not a single project, but represents a portfolio of projects. This means, that a supply chain may have hundreds of stakeholders to manage at all times.

	'''The six principles (6P)''' of stakeholder management in a supply chain are:<ref name="Sharma">Sharma, Raj. 2008. ''The 6 Principles of Stakeholder Engagement.'' Reed Business Information.</ref>		'''The six principles (6P)''' of stakeholder management in a supply chain are:<ref name="Sharma">Sharma, Raj. 2008. ''The 6 Principles of Stakeholder Engagement.'' Reed Business Information. An article describing the 6P in detail.</ref>
	* 1. '''Stakeholder Analysis:''' Exploring the various stakeholders and analyse their interests, strengths, etc..		* 1. '''Stakeholder Analysis:''' Exploring the various stakeholders and analyse their interests, strengths, etc..
	* 2. '''Engaging the Stakeholders:''' Ensuring the stakeholders are willing to change and partake in the project.		* 2. '''Engaging the Stakeholders:''' Ensuring the stakeholders are willing to change and partake in the project.