This is an excellent question. Table 2 shows some of the generic classification schemes introduced by researchers. and influence, in order to identify their role in the Green Network gover nance. Here’s what the guide says: 1. Learn the difference between Discrete Effort, Apportioned Effort and Level of Effort (LOE) in project duration estimation for PMP certification. A stakeholder may be legitimate but unless the stakeholder has power or need urgent attention, they would not receive the attention of the project manager. For example, in case of our large manufacturing plant setup, the local government is a dominant stakeholder in the project. Stakeholder power analysis is a tool which helps understanding of how people affect policies and institutions, and how policies and institutions affect people. The plan sets out the extent and way of the productive involvement of stakeholders in the project. The project manager needs to actively engage these stakeholders and have a strategy to manage these stakeholders. It helps to avoid scope creep and mitigates issues that may cause problems for the project. Thank you so much for enriching my post with your knowledge and experience. 6 uses information emerged from the findings of our systematic review and our stakeholder classification, to integrate and synthesize key findings regarding stakeholder engagement for innovation management and entrepreneurship development. The model is based on 3 attributes - power, legitimacy, and urgency. Such stakeholders usually have a “passive” stance to the project. This model does not help the project manager do comparison of one stakeholder with another based on a particular attribute. 2. Very well explained, i learn a lot in few minutes. Or would it rather just be the preference of the person/team doing the analysis?Regards. Power and Legitimacy combine to create Authority. Power and Interest model is the most common model used for stakeholder classification. As far as this third point is concerned then this is supported by research from Cooper at al (2001) into large firms. A stakeholder is any person, group or institution with an interest in the project. I liked how you expanded a lot of the concepts found in the PMBOK and also added the Venn diagram and its categories. For example, a local mafia or terrorist organization may seek to sabotage the development in the region that the new manufacturing facility may bring. The theory states that there are 3 reasons why this should happen: It is the morally and ethically correct way to behave Doing so actually also benefits the shareholders, o It reflects what actually happens in an organisation. The fourth - Salience Model - uses 3 attributes and adds the vital dimensions of legitimacy and urgency. For example, let’s say a powerful opposition party, which is favorable to the interests of the farmers, comes into power by winning the elections. It is a fundamental component of materiality assessments, which are then used to inform sustainability strategy, reporting, and disclosure. Would you be wiling to give me permission to embed this into our training and give you author credit? Dependent stakeholders lack power but have urgent and legitimate stakes in the project. Hello MF,There’s no option to download the content of the blog, but you can print the posts using the browser print function for your personal educational use (not for reproduction). Stakeholder mapping is the visual representation of a stakeholder analysis, organizing those people according to the key criteria with which you will be managing them during the project. For example, employees who were laid off from the job could be a dormant stakeholders. The Salience Model of Stakeholder Classification helps to identify the prominence of project stakeholders by classifying them according to 3 attributes: 1. Time-sensitivity - when stakeholder’s need is time-sensitive in nature, Criticality - when the need is important or critical to the stakeholder. Classifying stakeholders is a subjective process. Project success (dependent variable). Although stakeholders can be both organisations and groups, ultimately they are people. Stakeholder engagement framework . stakeholder and the other is an end user or tertiary stakeholder. One project manager may perceive a stakeholder as “dangerous”, while another may view the same stakeholder as just “demanding”. Other more specific interest groups may be relevant for certain industries due to the nature of the industry or the specific activities of the organisation. Stakeholder Engagement Framework (the Framework) represents ANMAC’s commitment to accountable and transparent stakeholder engagement. Bryan,That’s an excellent example! Legitimacy - their involvement is appropriate (morally, legally etc.). The examples of the mafia or terrorist group as a Dangerous stakeholder are certainly accurate but I would be interested if you could consider a Director of Accounting as a potentially dangerous stakeholder if they are threatened by a new SaaS CRM tool that doesn’t use their corporate ERP solution. The project manager’s attitude toward the stakeholders may differ based on his/her culture and values. The Framework is based on an adaption of the International Association for Public Participation (IAP2) spectrum. There may be stakeholders who do not have power, but still matter to the organization and the project. Internal stakeholders are those included within the organisation such as employees or managers whereas external stakeholders are such groups as suppliers or customers who are not generally considered to be a part of the organisation. There are several different types of stakeholder matrices: Power Interest matrix; Stakeholder analysis matrix; Stakeholder Engagement Assessment matrix The aforementioned classification of stakeholder importance is not in itself enough no matter the chosen classification. Non-Stakeholders or Potential Stakeholders, Mapping Salience Model to the Grid-based Models, Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts, Enterprise Environmental Factors vs Organizational Process Assets, Schedule Performance Index (SPI) and Cost Performance Index (CPI) in EVM, Discrete Effort, Apportioned Effort and Level of Effort (LOE) Explained. How do project managers prioritize their attention to competing stakeholders? Power - authority and influence in the organization and on the project outcomes They have the power and legitimacy, but no urgency as such. I was wondering if you could comment on how to choose between one of the matrixes or the salience model when doing a stakeholder analysis for an organisation/project. In this model, there is a chart with x and y-axis, where the x-axis represents the degree of interest and the y-axis represents the degree of power. Note that this is not a part of the Salience Model. How do project managers determine which stakeholders have the biggest impact or influence on the project and deserve the most attention? The grid based models … Hi Harwinder,You have described everything very simple and is very engaging.Just to elaborate I have added:Stakeholders can be classified based on their power – interest, power – influence, influence – impact, and power – urgency – legitimacy. If a stakeholder is powerful, legitimate and urgent then its needs will require immediate attention and given primacy. Expectant stakeholders are those who possess any 2 of the 3 attributes - Power, Legitimacy, and Urgency. High engagement is when these activities are numerous and/or of high quality; low engagement is the opposite. We are purposeful, inclusive, timely, transparent and respectful. But in reality, the stakeholders may possess various levels of power. The Salience Model of Stakeholder Classification helps to identify the prominence of project stakeholders by classifying them according to 3 attributes: The Salience Model was developed by Ronald K. Mitchell, Bradley R. Agle and Donna J. As mentioned by much of the literature, there is a need for understanding the relationships between the organisation and the different stakeholders. Dormant stakeholders do not require active engagement. Stakeholders who possess power and legitimacy, and have an urgent need are known as definitive stakeholders. Dominant stakeholders are those who possess both power and legitimacy, but not urgency. Urgency is based on 2 attributes. If not, take corrective action. For example, the stockholders of the organization who are powerful and legitimate feel that the new manufacturing plant is going to adversely effect the stock prices (urgency), they may oppose the project. 2 Summary Stakeholders are the people who matter to a system. The Salience Model is graphically depicted as a Venn Diagram. These are stakeholders that require active stakeholder engagement on the part of the project manager and the organization. It is important to prioritize the stakeholders to ensure efficient use of effort to communicate and manage their expectations. Indeed Sternberg (1997) suggests that the second of Freeman's (1984) definitions of stakeholder, which is now the more commonly used, has increased the number of stakeholders to be considered by management adopting a stakeholder approach to; in fact this definition includes virtually everything whether alive or not. Tags: Project Stakeholder Management, Stakeholder Analysis, Study Notes. The charity organizations, schools and hospitals that receive funding from the organization are examples of discretionary stakeholders. They create “noise” and can be irritants, but are not dangerous to the project as they lack the power and legitimacy (which together equals authority), and unlikely to command much attention. Instead of stakeholder management improving economic, or financial, performance therefore it is argued that a broader aim of corporate social performance should be used (Jones and Wicks, 1999). Salience Model helps to identify “Who or What Really Counts”. Salience Model: The salience model is useful for large complex communities of stakeholders or where there are complex networks of relationships within the community. The PMBOK Guide, 5th Edition identifies 4 models of stakeholder classification - Power/Interest Grid, Power/Influence Grid, Influence/Impact Grid, and Salience Model. You might have already found the answer but for the benefit of other readers, I’m posting a response. The constructs of the classification model juxtapose existing stakeholder theories and contributions from across the multi-contextual applications of stakeholder theory, thereby providing an invaluable overview of what we know about stakeholder theory in one model. In which case would you use salience vs e.g. Stakeholder power analysis March 2005 James Mayers (james.mayers@iied.org) has steered the development of this tool, from work in the forestry and land use sector. The classification model is then tested with positive results. I sincerely appreciate your contribution. The project team needs to recognize these dangerous stakeholders and the threat they bring, and devise a plan to mitigate the threat posed by these dangerous stakeholders to the project. They demand the utmost attention from the project manager and need to be attended to in a timely manner. But these stakeholder make acquire salience if they file a law suit against the company. The model emphasizes the need to pay attention to stakeholders in a timely manner. Among all, the power – interest classification is the most widely used to classify stakeholders.A stakeholder management strategy is a plan which helps you to keep all stakeholders satisfied by fulfilling their expectations and requirements. Power/Influence grid. The IAP2 spectrum … Therefore, the amount of effort spent on stakeholder management and engagement needs to be prioritized. Ref [20] suggested t wo aspects for stakeholder classification: involvement . Among all, the power – interest classification is the most widely used to classify stakeholders.Best Regards, Hi Harwinder, thanks for the article. Irrespective of which model is used, it is not controversial to suggest that there are some generic stakeholder groups that will be relevant to all organisations. Before we go further, let’s understand why we need to classify the project stakeholders. The framework optimizes the value creation of the project through stakeholder identification, classification, and requirement engineering. These stakeholder have legitimate stakes in the project and also possess the power to act on those stakes. The local society or the environment are not able to make this choice and must therefore be considered to be involuntary stakeholders. Stakeholders can be classified based on their power – interest, power – influence, influence – impact, and power – urgency – legitimacy. Hey there I was hoping to use this article in a training I was putting together in the company I am at. Power - authority and influence in the organization and on the project outcomes. A stakeholder matrix is a project management tool used to analyze a project stakeholder to determine the actions which are necessary to align their goals with the project. 4. The first step in stakeholder management is to identify the stakeholders. Academic library - free online college e textbooks - info{at}ebrary.net - © 2014 - 2020. Identify and Classify Stakeholders GFSI has a 20-year legacy with impact which spans the globe. The model considers the 3 attributes as either “present” or “absent”. Hope you found this post useful. They can be at any level such as external, internal, junior, senior and also they can be single individuals or entire organizations. This paper introduces a framework that is developed to assist project managers in facilitating stakeholder management and requirement engineering, especially in the project initiation phase. We want to work effectively with our stakeholders — to listen, learn and continue to improve our performance. These landmark studies not only advanced the stakeholder theory but also led … needs, expectations, interests, and; potential impact; of stakeholders as the criteria to determine their desired engagement level. A stakeholder may not necessarily be involved/included in the decision making process. By adding “urgency” to the mix, the stakeholder relationship moves from being static to dynamic. It is also useful in determining the relative importance of the identified stakeholders.Hope that answers your question. A Framework for Stakeholder Identification and Classification in Construction Projects Current construction is implemented in highly demanding and complex built environments where projects are executed by coalitions of multiple stakeholders that have divergent interests, objectives, and socio-cultural backgrounds. a power/interest grid? However attempts have been made by stakeholder theorists to provide frameworks by which the relevant stakeholders of an organisation can be identified. Clarkson (1995) suggests that the voluntary stakeholders include shareholders, investors, employees, managers, customers and suppliers and they will require some value added, or otherwise they can withdraw their stake and choose not to invest in that organisation again. Such stakeholders can be coercive or even violent in some cases. If I’ve missed something, please feel free to add using the comments section below. We have various models that help classify the stakeholders according to the their power, interest, impact, influence, urgency and other parameters. They possess no power or urgency to their claims. For example, is one stakeholder more powerful than another? Good summary and explanation of the original paper. The Project Management Institute’s framework lists the. Before I close, did you notice that the Salience Model uses mnemonics to promote recall? Therefore, understanding and meeting the needs of various stakeholders is essential to the survival of businesses. The framework was created through a novel iterative process of stakeholder identification and categorization. It has been criticized for failing to identify these factions (Argenti, 1993) although some attempts have been made. Stakeholder analysis (in conflict resolution, business administration, environmental health sciences decision making, Industrial ecology, and project management) is the process of assessing a system and potential changes to it as they relate to relevant and interested parties (stakeholders). The Salience Model doesn’t address this. But they acquired the missing attribute - legitimacy - by winning the election. Make a list of possible stakeholder categories (e.g., consumers, creators, contributors, champions, or blockers) to encourage breadth of thinking about types of stakeholders. They might not have any organizational legitimacy as they operate in a functional area that is not funding or contributing people to the project but they can actively sabotage or damage the project by delaying payments, challenging budget or forecast assumptions or indirectly attacking the project through ‘whisper campaigns’. I suggest you to read the original paper for a thorough understanding for the topic. The argument for Stakeholder Theory is based upon the assertion that maximising wealth for shareholders fails to maximise wealth for society and all its members and that only a concern with managing all stakeholder interests achieves this. The framework in Fig. Stakeholder theory (Freeman, 1984) posits that organizations should pursue a broader set of goals than improving shareholder wealth. Voluntary stakeholders can choose whether or not to be a stakeholder to an organisation whereas involuntary stakeholders cannot. It puts the construction of the manufacturing plant on hold. This research shows that the majority of firms are concerned with a range of stakeholders in their decision making process: Fig 4.2 Stakeholder inclusion in decision making. Some of those criteria may include interest, influence, financial stake, emotional stake, those on the periphery who are still important enough to keep in the loop, etc. This post provides of gist of the Salience Model that would help you prepare for answering the question on the PMP exam. Latent stakeholders can be of 3 types - Dormant, Discretionary, Demanding - depending upon the particular attribute - Power, Legitimacy, and Urgency - that they possess. The term salience means prominence, or the quality of being particularly noticeable or important. They rely on other “powerful” stakeholders to uphold their interests. According to this model, entities with no power, legitimacy, or urgency in relation to the project are not stakeholders and will be perceived as having no salience by the project team. Clarkson (1995) suggests that a stakeholder is relevant if they have invested something in the organisation and are therefore subject to some risk from that organisation's activities. Are there any typical attributes an organisation could have that would lead you to use the salience model and not a grid, or vice versa? Stakeholder classification schemes inspired from past research, and are based on the assumption that a particular stakeholder classification is universally accepted in all areas, are known as generic classifications. Likewise, latent stakeholders are not likely to give much attention or acknowledgment to the project. Hello Bas,I apologize for the late response. With limited time, energy, and resources for managing stakeholders, project managers may not spend much time in managing latent stakeholders. Sometimes stakeholders can influence … The three circles represent Power, Legitimacy and Urgency. The framework optimizes the value creation of the project through stakeholder identification, classification, and re- quirement engineering. Make a list of all the people or groups in each category. The Framework was informed by stakeholders, who were invited to share their perception of ANMAC and the accreditation process. The main variable deployed is the stakeholder's respective level of influence from the organization's management perspective, that is, their level of legitimacy, power and urgency. Stakeholder analysis yields useful and accurate information about those persons and organiza-tions that have an interest in health reform. Projects have limited time, and resources. Stakeholder classification is very important for establishing the right stakeholder management strategy. He separated these into two groups: the voluntary stakeholders, who choose to deal with an organisation, and the involuntary stakeholders, who do not choose to enter into - nor can they withdraw from - a relationship with the organisation. Stakeholder management throughout the project execution phase consists of the following actions: Ensure that the Stakeholder Communications Plan is being followed. Learn about the difference between Enterprise Environmental Factors (EEFs) and Organizational Process Assets with the help of examples and a cool new drag an... A Pareto Chart or Diagram, one of the Seven Basic Quality Tools, is a specific type of Histogram ordered by frequency of occurrence. person or group that can affect or is affected by a business organization If not, update it. However, Project Managers need to recognize them because if these stakeholders acquire legitimacy or urgency, they can acquire more prominence (salience) for the project. A Framework for Stakeholder Identification and Classification in Construction Projects @article{Aapaoja2014AFF, title={A Framework for Stakeholder Identification and Classification in Construction Projects}, author={A. Aapaoja and H. Haapasalo}, journal={Open Journal of Business and Management}, year={2014}, volume={2}, pages={43-55} } The conceptual framework of this study consists of 12 variables. Latent Stakeholders are those who possess only one of the 3 attributes - Power, Legitimacy, and Urgency. Before the elections the party may have had power and urgency but lacked legitimacy. As we go through the various types of stakeholders in the Salience Model, we’ll use the example of a manufacturing organizational setting up a large manufacturing plant in a rural community. Here is a process to identify stakeholders: 1. However, there may be other attributes too that influence stakeholder relationships. The Rate Framework represents a model that aims to address fundamental issues raised by stakeholders, partners and the WSIB itself, with the current employer classification structure and premium rate setting processes. Demanding stakeholders are those who have urgent demands, but no power or legitimacy. This assessment forms the basis of a project’s stakeholder engagement plan. For each group, identify the members or nominate a representative. According to this theory, stakeholder management, or corporate social responsibility, is not an end in itself but is simply seen as a means for improving economic performance. Power/interest grid, power/influence grid, or impact/influence grid: These classification models are useful for small projects or for projects with simple relationships between stakeholders and the project, or within the stakeholder community itself.2. There are two main ways to classify stakeholders: Internal v external. The development entailed a literature search to identify stakeholder categories, representation of identified stakeholders in a visual chart, and correspondence with expert informants to obtain practice-based insight. Expectant stakeholders can also be of 3 types - Dominant, Dependent, Dangerous- depending upon the combination of attributes - Power, Legitimacy, and Urgency - that they possess. Stakeholder is someone who affects a project or is affected by the outcomes of a project. The Salience Model has advantages over the 2-dimensional grid models such as the Power/Interest Grid, as it adds the vital dimensions of legitimacy and urgency. It provides the project managers a systematic approach to managing stakeholder relationships. But what criteria do we use to classify the stakeholders? Grid based. A fundamental aspect of stakeholder theory, in any of its aspects, is that it attempts to identify numerous different factions within a society to whom an organisation may have some responsibility. It is assumed that IV leads to Latent stakeholders may become Expectant or Definitive stakeholders, and Expectant stakeholders may become Definitive stakeholders by acquiring the missing attribute. These are stakeholder that “matter” to the project manager. We analyze the engagement of several actors in the innovation management and entrepreneurship development … For example, if the manufacturing plant is causing displacement of the local farmers in the area, then those farmers are “dependent” stakeholders in the project. For example, in this model, the stakeholders are treated as either possessing power or not possessing power. In this post, we’ll learn about the Salience Model of stakeholder classification. The stakeholders who only possess power but have no legitimacy or urgency are known as Dormant Stakeholders. Wood and presented in their paper Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts. The stakeholders who are legitimate but have no power, and their interests are not urgent are considered Discretionary Stakeholders. Though dependent stakeholders lack power, they can form coalitions with other groups of stakeholders and achieve power. Project teams need to actively look out for such transitions of stakeholders from one class to another. It is argued that involuntary stakeholders such as individuals, communities, ecological environments, or future generations do not choose to deal with the organisation and therefore may need some form of protection maybe through government legislation or regulation. Power/Interest grid. Applying the 4 stakeholder management strategies used in the Power/Interest Grid model to the Salience Model, following is the interpretation that I made. These are exactly the problems that the stakeholder classification models address. The stakeholder theory argues that business used to think permits, licenses, or other qualifications are sufficient to operate, but the company should try to ‘earn’ their place as a member of modern society. In our example, these powerful stakeholders could be non-profit NGOs, or even management of the company who are sensitive to the needs of the displaced farmers and offer them adequate compensation. To do this we use 5 principles to help our engagement. Mitchell, Agle and Wood (1997) develop a framework for identifying and ranking stakeholders in terms of their power, legitimacy and urgency. Hi Corbett,Sure, go ahead and use it with site name, author name and a link to this page or site home page.Thanks. All 7 classification names begin with a ‘D’! Such stakeholders usually have an “active” stance to the project, compared to the “passive” stance of dormant stakeholders. For example a supplier can choose to not deal with the organisation and therefore is a voluntary stakeholder. These are stakeholders who are “expecting something” from the project. 11 minute read    Updated: April 29, 2019    Harwinder Singh. Stakeholders should be identified in terms of their roles not individual names. 3. Stakeholder theory states that all stakeholders must be considered in the decision making process of the organisation. The classification of stakeholders There are two main ways to classify stakeholders: Internal v external Internal stakeholders are those included within the organisation such as employees or managers whereas external stakeholders are such groups as suppliers or customers who are not generally considered to be a part of the organisation. the four features of the RTTT highlighted in conceptual framework • plan the stakeholder engagement activity • manage and monitor the stakeholder engagement activity • be transparent in the design and delivery of the plan • measure our performance against the plan. Assess whether the Stakeholder Communications Plan is still meeting the needs of the project. Manage-through-Stakeholder, consisting five observed variables of stakeholder identification & classification, communication, engagement, empowerment, and risk control (mediator); and 3. 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