Expectations Management

As stated in the The 5th edition of PMBOK from the Project Management Institute (PMI), "It is critical for project success to identify the stakeholders early in the project or phase and to analyze their levels of interest, their individual expectations, as well as their importance and influence." This article will focus on the individual expectations aspect mentioned. To do so, some basic concepts on stakeholder management will be introduced and explained as a basis for the core of the article

How different stakeholders will have different expectations within a project, how these stakeholders need to be categorized based on the interest and influence on the project, and how to successfully manage the expectations of different types of stakeholders.

Different methods and tools on how to align and manage expectations are introduced and explained. Furthermore, those methods are categorized based on when in the process they are relevant and for what type of stakeholder they are relevant. Limitations and weaknesses of each method are examined and suggestions on how to avoid them given.

Overview

Introduction

Project management is used across the world, in all sectors and industries. Project management is used to improve project results through different stages of the project lifetime.

In the context of project management, expectations management relates to the stakeholders in the project, which then is a concept within the general concept of stakeholder management. ISO 21500 defines a stakeholder as, "Person, group or organization that has interests in, or can affect, be affected by or perceived itself to be affected by, any aspect of the project. . As a project is a temporary endeavor with a defined beginning and end, expectations management is extremely important and needs to be considered from the first phases of a project and through out the project lifetime.

Project stakeholder management was added as the tenth knowledge area in 2013 by the project management institute. . Project stakeholder management was formerly part of the project communication management knowledge area. This shows clearly the increased emphasis being put on stakeholder management in later years. This also suggests that project management is moving more in the direction of stakeholder expectations management and away from managing products and deliverables. Furthermore, recent literature suggests that project success is in large a result of stakeholder management. One could even argue that a project ending up with all the stakeholders happy is a job well done.

As expectations management is different between the different types of stakeholders, a closer look will be taken into stakeholder management to establish the ground.

Identifying the stakeholders of a project is of great importance, especially the ones who are defined as the major stakeholders.

The stakeholder circle is a methodology designed to include stakeholder management in project management. This methodology has the following five steps in terms of stakeholders: Identify, prioritize, visualize, engage and monitor the stakeholders. The first step here is very relevant for this article. Identifying the projects stakeholders and understanding their needs will play a key role in understanding and managing their expectations throughout the project.

The methodology categorizes stakeholders according to directions of influence (002517) These directions are: upwards (senior managers), downwards (the team), sidewards (peers of the PM) and outwards (outside the activity).

the iron triangle of the project environment states that success equals "On time, on budget and delivering the specified scope"

Knowing who the important stakeholders are early in the life of the work, and knowing their expectations, ensures that conflicts can be recognized and addressed proactively.

Application

Expectancy Theory

Expectancy theory was formulated by Victor H. Vroom in the 1960s. This is still today a very popular theory within motivation management, as it focuses on all three parts of the motivation equation: inputs, performance and outcomes. The theory claims that individuals will behave in a certain way based on a desirable outcome, related to that behavior. The theory identifies three major factors determining a persons motivation

• Expectancy: Links effort to performance as follows: Ones perception on how his or her effort leads to a certain level of performance
• Instrumentality: Links performance to Outcomes as follows: Ones perception of how a certain level of performance results in attainment of outcomes
• Valence: How desirable the attained outcomes are to a person

Stakeholder management planning

Stakeholder management is one of, if not the most important task in successfully managing projects. When planning the management of stakeholders, the project manager is looking into how the project will affect the stakeholders, by doing so, the project manager can plan ways of engaging those stakeholders relevant for the success of the project in a positive way. Properly identifying stakeholders of a project early on and mapping them, allows the project manager to allocate his time appropriately between the stakeholders. The process of stakeholder management will be broken down into different phases. Each phase is explained, using the appropriate theory and tools. The actual inputs and outputs of each of those steps are scoped out of this project.

Stakeholder identification

The first step in planning stakeholder management is to identify the stakeholders of the project. One way of doing this is iterative meetings with known stakeholders are held in order to identify further stakeholders. For example, the first meeting would be with the key stakeholders from within the project team. Those identified in that meeting would then be invited to a new meeting together with the member of the first meeting to see if further stakeholders can be identified. This then should be done until a satisfactory list of stakeholders has been created.

Expert judgement can also be used to identify stakeholders. Groups or individuals with expert knowledge within the scope of the project can for example be used to identify possible stakeholders, and their role in the project. This group or individuals can be from within the project team, or as is more common an outside hire with the special knowledge and skill set.

Three tools commonly used in stakeholder identification are: Expert judgement, Meetings and Stakeholder analysis . Expert judgement

Stakeholder mapping

Figure 01: Stakeholder mapping

Figure 02: Stakeholder directional mapping [1]

Stakeholder analysis is used to map all the stakeholders of a given project, to do so, qualitative and quantitative information needs to be gathered. This information is then used to evaluate each stakeholder. Stakeholder analysis generally follows three steps. .

• Identify all relevant stakeholders. Already described in the stakeholder identification section above.
• Analyze stakeholder impact or support. This can be very important in terms of expectations management.
• Assess how key stakeholders are likely to respond in various situations. This is more of an retrospective approach and is intended to prepare the project manager on the best way of dealing with unforeseen problems during the lifetime of the project.

Once all of this data has been gathered and processed there are many different ways of mapping the findings. One of the most popular ones, and the one used in this article is the Power/Interest grid shown in Figure 1

Another methodology used to map and or categorize stakeholders is called the stakeholder circle. One of the tools represented here is identification, where the stakeholders are split into 4 types from the perspective of the project manager. Despite the name, this tool is placed under stakeholder mapping and can be seen in figure 2.

• Upwards: This concerns the Senior managers of the company. Those are the stakeholders that secure the internal commitment of the company to the project. Often these stakeholders have high power over the project without necessarily having so much interest in it. Thus they should be kept satisfied, and if possible, the aim should be to increase their interest in the project to make sure the continued internal support of the project.
• Downwards: Members of the project team, hence the people doing the actual project work. This group is often overlooked as being important by project management. Typically the group wound end up in the lower right corner of the power/interest grid although fairly high up in that quadrant. Those stakeholders should be kept informed
• Outwards: This is in most cases the biggest group out of the four and includes all the external stakeholders. Depending on the project this group could include governments, unions, shareholders, customers, suppliers e.c. Because of the versatile nature of this group and the different types of projects it is very difficult to place the group as a whole in any one part of the power/interest grid. Those stakeholders are likely to be spread out over the grid.
• Sidewards: Peers of the project manager, such as other project managers. this group can generally be placed in the lower left quadrant of the grid, and minimum effort should go into the stakeholders of the group, although it can be beneficial to the project to try and move those stakeholders further to the right to increase the internal drive of the project.

Stakeholder expectations

Clarifying stakeholder expectations at an early stage is very important. The importance of the planning phase of a project is often underestimated. This phase is extremely important in terms of project success. A big part of this planning should be expectations management, identifying what values are important to the key stakeholders and seek out ways of how to deliver them. Expectations of key stakeholders, not planned for, which are discovered later on in the process, can prove both very costly and time consuming, which in return can lead to the snowball effect of the project not being able to meet the expectations of other stakeholders in terms of cost and time. Once the important steps of properly identifying and mapping the stakeholders, the next step is therefor to figure out the expectations of each of the identified stakeholder. This third phase in the stakeholder management process can be quit time consuming, given the fact that stakeholders often don´t have a clear view of their expectations themselves, the first step of this process often is to help stakeholders identify their own expectations. That again means that this phase is very dependent of the project managers personal and communication skills. Even though there are tools available for this process, the project managers soft skills, and his abilities to understand his key stakeholders expectations can prove to be more important than any of them. expectations are often communicated non-verbally and do therefor require certain skills of the project manager. Those people and communication skills can again prove priceless in situations where unexpected and or unforeseen expectations arise later on in the project. In such cases the ability of the project manager to properly communicate and manage the change in the project heavily rely on the mentioned personal and communication skills.

Limitations

• Stakeholder diversity: Once projects grow in size, especially in terms of stakeholders, it becomes increasingly difficult to satisfy every stakeholder involved. It has been debated for a long time weather the ability to satisfy one stakeholder group always comes at the expense of another stakeholder group or not. More recent studies argue that the following three primary stakeholder groups can be satisfied all at the same time, employees, customers and owners . However, as the number of stakeholder grows within a project, program or portfolio, and even as the 3 mentioned primary stakeholder groups grow, the task of meeting everyone's expectations becomes more and more difficult.
• Changing priorities:

Annotated bibliography

• Essentials of Contemporary Management, Sixth Edition - Chapter 9

The Chapter, Motivation, looks at motivation from a general perspective within management. It looks in depth at a few key models and theories within motivation management, and one theory in particular, expectancy theory looks into the relationship between individuals efforts and the individuals believes in those efforts resulting in something desirable for him or her.