What are the most crucial Construction Programme Best Practices?


April 26

Impact of stakeholder management on the success of a construction project

Most formal sources, such as the Project Management Institute (2001), define stakeholders as: “individuals and organisations that are actively involved in the project or whose interests may be positively or negatively affected by project implementation or successful project completion”

The success of any project depends on a number of factors:

  • Clear objectives
  • A realistic project schedule
  • Budget
  • Resources
  • Risk and uncertainty management.

However, the positive outcome of a project depends not only on processes but also on people.

Stakeholders in a project can be divided into two groups: Internal stakeholders of the organisation, for example, the team members of the project or those who provide funding for the project. External stakeholders are the people who are affected in some way by the project.

In most projects in the construction sector, there are a variety of stakeholders, and the diversity of their nature and requirements creates a conflict of interest.

The checklist of stakeholders in a construction project is often extensive and includes facility owners and users, project management, team members, facility managers, designers, shareholders, public administration, employees, subcontractors, service providers, competitors, banks, insurance companies, media, community representatives, neighbours, the public, customers, and regional development agencies.

Each of them could have an impact on the project’s progress at some point. Although some of them may influence the project more than once, the majority of them will do so at some point in time.

Stakeholders will determine the success or failure of your project. Here are the main reasons why they are the key players in the project:

Proper stakeholder management ensures risk-free project delivery

Risks cannot be completely eliminated, but if you engage stakeholders, you can manage project risks much more successfully. Lack of interaction with stakeholders or their inadequate engagement can confound construction program management.

Their needs, status, and expectations can change at any point during project execution, which in turn can significantly impact project structure, terms, schedule, and deliverables.

Stakeholders are a source of project-related knowledge

In theory, a project manager (PM) should have industry, product, and some technical knowledge, but in reality, they often do not have enough information to compile project requirements and identify constraints. In this case, PMs involve stakeholders and share with them all the important project-related data.

Stakeholder involvement ensures project execution

When your project’s stakeholders are aware of every detail, they are more likely to help you complete the project on time and within budget.

To ensure project success, as a project manager, you need to know who they are and meet them face-to-face to build a working relationship. Those organisations that manage their stakeholders better guarantee big gains in their results over time.

The key points of stakeholder management in the construction industry along with their impacts are as follows:

  1. Create a detailed stakeholder management plan
    Impact: All stakeholders are properly informed about all relevant stakes
  2. Create a matrix of stakeholders based on Power and Interest
    Impact: PMO would know who the major stakeholders are and who needs to be managed better.
  3. Follow the stakeholder matrix.
    Impact: PMO would know who to inform, consult, collaborate and involve at what phases.
  4. Interview stakeholders during the design phase.
    Impact: Gathering of knowledge, fixing scope.
  5. Ensure transparency.
    Impact: Fewer changes in scope, better acceptability.
  6. Use effective communication methods.
    Impact: All communications are tracked, and no stakeholders are kept in the dark.
  7. Use soft power.
    Impact: Many conflicts which might impact the project can be managed.
  8. Use automated tools and techniques.
    Impact: Ease of communication and less personnel needed for disseminating information.

Modern construction management studies have seen that there is a better success rate of projects if the above tips are followed.

Stakeholder management is vital for project success

project success

Stakeholder management is a crucial aspect of the success of construction projects. Stakeholders have different interests, expectations, and influences on the project outcomes. Therefore, it is important to identify, analyse, and engage with them effectively throughout the project lifecycle.

By doing so, PMs can reduce conflicts, enhance collaboration, and increase satisfaction among all parties involved. Stakeholder management can also help achieve project objectives in terms of quality, cost, time, and scope.

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