Stakeholders are any individual or organisation that has an interest in or can be affected by a project, product, service or venture.
In any activity an organisation undertakes, whether strategic, operational or tactical, the activity can only be successful with the input, commitment and support of its key stakeholders. Identifying connected supply chain stakeholders, then engaging, gaining and maintaining their support and commitment is a continuous process.
Use CIPS Stakeholder tools to help to identify key stakeholders in the procurement process and manage these internal and external stakeholders effectively.
Who are the Stakeholders in the Procurement Process?
These are broadly divided into two categories, either internal or external stakeholders. Internal stakeholders include budget owners, finance teams, legal professionals and senior management. External stakeholders refer to suppliers and other partners.
The key to managing both groups is building relationships and conducting your homework on the function and needs and wants of both groups.
Who are the Stakeholders in Supply Chain Management?
Stakeholders in the Supply Chain are a broader more completed group from the suppliers of materials and services, through to delivery and logistics and customers and consumers. The regulations of government and local bodies and the actions of competitors also make them connected stakeholders in this process.
The actions or inactions of one group in the chain can affect all the stakeholders in the chain. Managing this group is more complex and may require you to ‘think locally, act globally’ while implementing expertise and innovation in your communication and collaboration techniques to manage activities.
What is an Upstream or Downstream Stakeholder?
Upstream or downstream stakeholders refer to the group that is engaged at each point in the process. For example at the point of delivering goods or services, the upstream stakeholders would be the group that supplied these to be delivered, whilst the downstream stakeholder are the consumer or customer that receives the goods or services.
Identifying all procurement and supply chain stakeholders at the beginning will help you understand impact at each stage in the process.
Use CIPS Stakeholder tools to help to identify key stakeholders in the procurement process and manage these internal and external stakeholders effectively. This classification depends on their position in relation to the organisation or project. An upstream stakeholder is a customer or end user. A downstream stakeholder is a supplier or service provider.
The identification of supply chain stakeholders is important. Without correctly identifying stakeholders and ensuring their inclusion, problems could develop.
Once identified the individuals or organisations need to be classified, engaged and interacted with as well as being managed appropriately to ensure the outcomes are as required.
Effective Stakeholder Engagement
It is important to spend time mapping and planning your engagement strategy and communication plans and how much support you may need for this activity. The time spent on this planning stage will directly impact your overall success.
Through positive engagement with stakeholders, project managers, procurement managers and purchasing procurement staff will be able to improve the quality of the outcome. This is because stakeholders can provide important and often unknown information as well as support once communication takes place rather than putting obstacles in the way of progress.
If stakeholders are not identified and engaged with, this can present risks for the project outcome. Potentially if the correct stakeholders are not identified and managed effectively deadlines could be missed, budgets could present variances and ultimately and the worst possible scenario is that the project could fail.
5 Tips for Stakeholder Management to Drive More Value in 2020
Aim for more than just a seat at the table
Take a holistic company/CEO perspective
Go beyond qualitative supplier evaluations
Enable trade-offs between conflicting objectives
Unite the business behind your approach
Behavioural procurement skills to connect and build relationships with stakeholders – David L Loseby (FCIPS)
Listen to the Podcast
Using game theory methodology to influence internal stakeholders – Dr Sebastian Moritz, TWS Partners
Listen to the Podcast
Procurement must enhance their soft skills – Tim Jenkins and Ian Castle, Wheelspinner
Listen to the Podcast
Maximising influence & impact: How to present to the C-Suite
CIPS and Hays Talent Solutions webinar: ‘How to present to the C-Suite for Procurement teams’. Includes an introduction to the art of storytelling, what really matters to the C-Suite and real life examples from leading procurement professionals.
Top 10 tips for influencing stakeholders from CIPS & Hays
Recording from 2nd July 2019- CIPS and Hays Talent Solutions webinar on how to Procurement teams can improve their influence and impact
CIPS Stakeholder Tools
- Identifying types of stakeholders - This model shows the three different categories of stakeholders, internal, connected and external.
- Stakeholder identification brainstorming - By identifying the stakeholders who will have an impact on the outcome of the project, the process can be managed effectively.
- Stakeholder identification techniques - This model outlines techniques that can be used as aids in the identification of stakeholders.
- Stakeholder engagement - Stakeholder engagement is important throughout the duration of the project.
- Mendelow - Once the stakeholders have been identified they can be categorised. By categorising stakeholder into four different quadrants, procurement professionals can understand the amount of engagement that is needed as well as the level of information that needs to be shared.
- Stakeholder mapping template - This template should be used as an aid to see who or which organisations need to be managed in which way throughout the duration of any project.
- RACI - RACI is another tool that can be used to help understand and manage stakeholders.
- RACI template - The RACI template allows project managers to enter in the names of the stakeholders in the cells along the top of the template and write in the tasks in association with the project.
- Stakeholder management - This diagram shows how it is important to manage stakeholders correctly to keep them up to date with a project that they have identified as being important to them.
- Stakeholder interaction - This model demonstrates the frequency of interaction that each stakeholder group should receive based on their influence within a project.
- Conflict Resolution - This model shows that there are five main ways in which conflict can be resolved.
CIPS members can download the CIPS Stakeholder Tools to use in your organisation along with the full guidance notes will full details of all of the tools above and how to use each tool effectively.
Stakeholder Resources for Members
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