Stakeholder Expectations Management

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Stakeholder satisfaction is a main factor in a project success. Therefore, for a project manager is vital to have under control the satisfaction of the different stakeholders.

Stakeholder satisfaction is impacted by multiple factors during a project and it can be hard to directly manage it, but it can be improved by managing and aligning the stakeholder expectations. In fact as illustrated by the expectancy disconfirmation model the stakeholder satisfaction is given by the discrepancy between the perceived performance of and the prior expectations about the outcomes.

Expectations usually differ between the different parties in a project and as the number of stakeholders arises aligning becomes more and more difficult.

This article will present a set of tools to identify and manage stakeholder expectations, both in the planning and execution phases. The tools will be divided in preventive tools, to use in the planning phase and reactive tools, to support the project execution.

Project Management and Stakeholder Management

Stakeholders are defined by the ISO 21500 standard as "a person, group or organisation that has interests in, or can affect, be affected by, or perceive itself to be affected by, any aspect of the project" [ISO21500. 2012. Guidance on Project Management. International Organization for Standardization]. Therefore, any project leader should identify analyse and categorize all the key stakeholders defining which interests they have and how important they are for the completion of the project.

TALK ABOUT PM performance domain.Bold text

Stakeholder Management is used to describe the process of identifying, assessing and building a relationship with the stakeholders. [How to do projects]

Different theories provide different criteria for project success; however recent literature is converging on defining the project success as a result of stakeholder satisfaction. Other tools like the triple constraint (http://apppm.man.dtu.dk/index.php/Project_Management_Triangle) should be used when monitoring and controlling to check whether the project is deviating from its baseline and business criteria should be taken into account. But these are not the right indicators to evaluate if a project is a success or a failure. [1]

The importance of expectations in stakeholder satisfaction

From the previous section we understood how important ending the project with satisfied stakeholder is for the project success. In this section two theories on the elements will be presented to understand how managing stakeholder expectation is the first step in stakeholder satisfaction.

Expectation confirmation theory

Expectation confirmation [2] theory is a cognitive theory developed in the '70 by Richard L. Oliver. It was developed in a marketing literature but from there it was applied in multiple fields since its versatility and simplicity. The first application was to explain post-purchase or post-adoption satisfaction. This effect is mediated through positive or negative dis-confirmation between expectations and performance. If a product outperforms expectations (positive dis-confirmation) post-purchase satisfaction will result. If a product falls short of expectations (negative dis-confirmation) the consumer is likely to be dissatisfied. [3] Although this gap model of satisfaction was developed primarily within marketing to explain customer satisfaction, it is likely that the relationships apply to other stakeholder groups (Taylor, 1993)

Stakeholder satisfaction model

Stakeholder satisfaction model was developed in 2001 as an extension to the expectation confirmation theory. In this model, satisfaction is thought to be a two-phase process of:

1) communicating accurate information regarding realistic expectations of the exchange or relationship, as well as accurate depictions of actual performance

2) providing actual performance, which equals or exceeds expected performance.

Figure 2: Stakeholder satisfaction model

Note: this section will be concluded how this model can bring to a better understanding of the relation between expectations and satisfaction and provide a landscape in which the tools presented in section 3 will be connected together.

Toolbox

Preventive toolbox

Stakeholder inventory

The first step of managing the stakeholders expectation is to have the complete picture of who is a stakeholder in the project.

Stakeholder analysis

From this first list is important to prioritize the stakeholders in base at their relationship with the project. For the purpose of this article, the theory background and detailed explanation on how to use the tool will not be presented. The page Stakeholder Analysis explains in depth the concept and it's application.

Reactive toolbox

Interest based negotiation

Integrative bargaining (also called "interest-based bargaining," "win-win bargaining") is a negotiation strategy in which parties collaborate to find a "win-win" solution to their dispute. This strategy focuses on developing mutually beneficial agreements based on the interests of the disputants. [4]

Project Management Triangle

The Project Management Triangle (called also Triple Constraint or the Iron Triangle) is a model of the constraints of project management. Following the definition of a new expectation this tool can support the understanding of how the rest of the project will be impacted to satisfy this new expectation. In fact one side of the triangle cannot be changed without affecting the others.This triangle reflects the fact that the three properties of a project are interrelated, and it is not possible to optimize all three – one will always suffer. [5]

RACI Matrix / will be probably removed

The Responsibility Assignment Matrix (RACI Matrix) focuses on clarifying what stakeholders roles and responsibilities are in a context of a specific task or process step. It classifies stakeholders according to one of the following roles for specific project activities:

Responsible: The stakeholder performs the project work activities.

Accountable: The stakeholder is accountable to the sponsor or to the customer for the result of the work activities.

Consulted: The stakeholder is asked for opinions on objectives, assumptions, constraints, or methods of planning and developing products or process due to expertise or position in the organization.

Informed: The stakeholder is notified of the outcome of project decisions.

Using this matrix, the project leader can control which stakeholder should be informed or consulted in regards to a certain task