What is a stakeholder in project management?

Think of your project as an Oscar-nominated movie. You won, and you have to go up and give your big speech. Who do you thank?

In project management, those people would be your project stakeholders—people who have a stake in your project, and have helped you get there in some way. Project stakeholders can be the people doing the work, the people approving the work, or even the people you’re doing the work for—but they’re all important. Knowing how to identify and manage project stakeholders can help you increase your project’s impact. Here’s how.

What is a stakeholder in project management?

Project stakeholders are the people who can impact or be impacted by the project you’re working on. Stakeholders can come from every level of the organization, from individual contributors to senior executives—but if they’re involved in your project, they’re important. Even if your stakeholders aren’t directly involved in the day to day of the project, they may still be affected by its outcome.

How to identify project stakeholders

In a broad sense, almost everyone can be affected by your project's outcome. But in project management, your project stakeholders are the people who are involved—in some capacity—in your project’s decision-making process. These might be important stakeholders who approve the project’s deliverables, or they might be the team members doing the work to get from point A to point B. Members of your target audience are also project stakeholders, since they’re the most impacted by the decisions you make. Basically, you can identify project stakeholders by asking yourself one simple question: “Will the work I’m doing affect that person?” If the answer is yes, they’re likely a project stakeholder.

[Read: What are the benefits of project management?]

It’s important to note that not everyone who will be affected by your project has a say in how it goes. Key stakeholders, like the ones we’ll discuss in this article, are those that have a say in the outcome of a project. Knowing who your key stakeholders are can help you improve stakeholder relationships and gain buy-in from the people who matter most.

The two types of stakeholders you might encounter in your project

Broadly, there are two types of project stakeholders: internal stakeholders and external stakeholders. Internal stakeholders are probably who you think of when you think of stakeholders. They include anyone who works in your company—from your direct reports to your executive leadership—who are invested in your project. On the other hand, external stakeholders are anyone outside of your organization. These might be customers, an agency or contractor, users, investors, suppliers, or other external contributors.

Type of internal stakeholders
Types of external stakeholders
  • Customers
  • Contractors
  • Subcontractors
  • Users
  • Investors
  • Suppliers

5 steps to manage project stakeholders

Identifying and managing your project stakeholders is a great way to set yourself up for a successful project. When your key project stakeholders are bought in, they lend support that can be critical during the project lifecycle. Alternatively, without supportive stakeholders, you could find yourself having to set stakeholder expectations mid-project, which can lead to changes and unnecessary project risks. To avoid that, here are the five steps you need to take to effectively manage your project stakeholders.

Step 1: Identify stakeholders

Before you can manage stakeholder expectations, you first need to know who your project stakeholders are. Make sure to account for both internal and external stakeholders. To figure out who your project stakeholders are, ask yourself:

  • Who cares about this project?
  • Who will be impacted by this project?
  • Who can influence this project?
  • Who can approve/reject this project?

If you need help tracking your stakeholders, consider creating a RACI chart or stakeholder register to track who everyone is, why they matter, and what their impact on the project will be. Before you move on to step two, do one last sanity check. Ask yourself:

  • Are there any other internal stakeholders I should be aware of, like resource managers or project portfolio managers?
  • Have I included all key project leaders and managers?
  • Are there any external stakeholders I’m missing who might be impacted by the outcome of this project?
Step 2: Understand stakeholder needs

The reality is, some stakeholders may disagree with certain elements of the project. As the project manager, it’s your responsibility to understand their needs and perspective, and come to a solution that doesn’t negatively impact the success of the project. It’s not your job to do everything your project stakeholders ask—but it is your job to listen and understand their needs.

Sometimes, what feels like a “difficult stakeholder” is just someone who has different priorities than you. Maybe your work is even disrupting some of their work. If you try to see things from their perspective, you have a better chance of finding a solution—and turning the situation into a win-win scenario.

Step 3: Get buy-in

High stakeholder engagement can really take your project to the next level. Once you’ve identified your stakeholders and thought about their needs, make sure you invite them to your project planning sessions and kickoff meeting, if you have one. Key stakeholders should also sign off on your project plan, project objectives, and project scope.

Though you should aim to invite a variety of different stakeholders, make sure you’re prioritizing key stakeholders. You don’t need approval on everything from everyone. The best way to decide is to think of stakeholders along an influence/interest scale:

  • High influence and high interest. These are probably your project approvers and/or sponsors. Externally, these may also be close partners or customers. Make sure you check with these people regularly to ensure your expectations and their expectations are aligned.

  • High influence and low interest. These people can block or support your project, but they probably aren’t interested in doing so. They might be distant cross-functional partners or executive leadership at your company. Make sure these stakeholders are aware of your project basics, and ask your high influence and high interest stakeholders to help you manage the relationship, if need be. Keep in mind that, even though these are high influence and low interest stakeholders, their work might be impacted by your work—and you don’t want that fact to come as an unexpected surprise.

  • Low influence and high interest. Keep these people informed, but you don’t need their signoff on early stuff. It’s more important to loop them in during Step 5.

  • Low influence and low interest. These are secondary stakeholders. Depending on the size and complexity of your work, you might want to loop them in semi-regularly on project status reports, or not loop them in at all until the end.

Step 4: Establish boundaries

Good stakeholders bring a lot to your project. During the project planning phase, your stakeholders are your guide to figuring out where the project should go. Internal stakeholders can support you in developing a budget or resource management plan for the project. Knowing who your external stakeholders are can help you set your project scope and project objectives. Then, once the project gets underway, good project stakeholders can drum up support, help when things go wrong, and keep your team motivated.

But sometimes, overeager project stakeholders can have a negative impact. You’ve spent a lot of time planning your project and figuring out your deliverables—but if too many stakeholders have ideas for new deliverables, updated timelines, or adjusted budgets, your project could quickly veer off course.

The best way to establish boundaries with your stakeholders is to implement a change control process. By creating a process for proposing, reviewing, and accepting changes to your project’s scope, you can ensure your project is dynamic and up-to-date, without worrying about scope creep. There are four elements to a change control process:

  1. Project stakeholders submit a change request.
  2. Key stakeholders review the request.
  3. Approve, reject, or defer the change.
  4. Adjust the project scope or objectives accordingly.

[Read: 7 common causes of scope creep, and how to avoid them]

Step 5: Keep stakeholders in the loop

As your project gets underway, make sure to update any relevant stakeholders on changes and progress. In addition to increasing visibility, documenting your processes early reduces the risk of any miscommunication down the road.

You may meet with some stakeholders—your high influence and high interest stakeholders, for example—frequently to discuss the project and deal with any unanticipated challenges. But to keep the rest of your stakeholders in the loop, send out regular project status updates with recently completed milestones, any blockers, and next steps. We recommend sending an update every two weeks, or more frequently if you’re managing a complex initiative.

[Read: How to write an effective project status report]

The key to managing stakeholders is clarity

To ensure your project goes off without a hitch, you need to make sure your stakeholders’ expectations match your project deliverables—in other words, you need to increase and encourage clarity across your project.

The best way to do that is with a work management tool, like Asana. Work management tools help you coordinate people and work across all levels of your organization. To learn more, read our introduction to work management.

Create your next project plan with Asana.