Stakeholder Management: A summary and our approach
As a not-for-profit, who are your stakeholders?
At its simplest, the term ‘stakeholder’ refers to anyone with an interest in your organisation (or project, initiative or program) as well as anyone impacted by what you do. As with private businesses, not-for-profit stakeholders can include individuals, groups and other companies. Some organisations also consider the environment to be a stakeholder.
Internal stakeholders
Internal stakeholders are the folk working and volunteering within your organisation. For not-for-profits, internal stakeholders generally include your:
Board of directors (or committee of management) and any associated sub-committees
Executive or senior leadership team
Other team members, including managers, team leaders, frontline employees, back office and administrative staff, and technical experts
Volunteers
Members
Profit-for-purpose and other impact-led companies may also need to consider the following additional internal stakeholders:
Investors
Shareholders
Owners
Founders
External stakeholders
To state the obvious, any non-internal stakeholders are then your external stakeholders. This means that an external stakeholder is anyone outside of your organisation. Not-for-profit external stakeholders may include:
Beneficiaries, customers, clients, end-users and community members
Local, state and/or federal government
Other not-for-profits, charities and for-purpose organisations, such as social enterprises, social businesses and B Corps
Philanthropic trusts and foundations
Individual donors
The private sector
Universities, academics and researchers
Media
Suppliers and vendors
Consultants and advisors
The environment including air, land, oceans, rivers etc.
Unions
Religious institutions and orders
Please treat this list of external stakeholders as a starting point rather than an exhaustive list.
Grouping your internal and external stakeholders
Every organisation will group its internal and external stakeholders differently; there is no one set formula or structure. For example, an educational not-for-profit may want to define its beneficiaries in distinct groups such as “students”, “teachers and educators”, “principals and school leaders” and “parents and carers” to recognise the distinct roles, demographics and preferences of these different stakeholder groups.
Collaborators, competitors and opponents
At Tanck, we define stakeholder management in terms of outcomes. That’s why, for us, stakeholder management is all about building and maintaining the relationships that matter the most. For not-for-profits, this comes back to your organisation’s vision and the impact you seek.
There are a number of components to stakeholder management including:
Articulating the outcomes and impact you seek from stakeholder management activities
Mapping your stakeholder environment and identifying priority external and internal stakeholders
Initiating new stakeholder relationships
Maintaining and strengthening existing stakeholder relationships
Reviewing and auditing your stakeholder management plan and stakeholder relationships
Integrating stakeholder management plans, principles and priorities across your organisation
Developing and implementing a stakeholder management plan or stakeholder management strategy can help bring these components together, provide direction, prioritise the opportunities at hand, and ensure stakeholder management happens… and happens well! We share more on developing a stakeholder management strategy further down the page.
Why is stakeholder management important?
Let’s revisit our definition of ‘stakeholder’ here, which is anyone with an interest in your organisation, project, initiative or program as well as anyone impacted by what you do. As we’ve spoken briefly to above, those interested in and impacted by your work may support or oppose it, or sit somewhere in the middle. This is at the heart of why stakeholder management is important. Effective stakeholder management can amplify your supporters and minimise your opponents.
In addition, when done well, stakeholder management can be a mechanism to build coalitions, movements and alliances. Creating or joining a collective can increase your chances of being heard and taken seriously by particular stakeholders, such as the general public, government and the media.
When considering stakeholder management for your organisation, it may be helpful to use the above internal and external stakeholders lists as a starting point. You can then think about whether any groups are irrelevant (or less relevant) to your organisation, whether you can group some categories together, or whether you’d like to create sub-groups as per the education example above.
Another way not-for-profits can think about their stakeholders is by considering their relation to you. A collaborator is on most people’s radar and the definition is obvious – it’s someone you collaborate with. A competitor is hopefully also on the radar and obvious in definition – it’s someone you compete with, be that for customers/clients, funding, airtime or something else. Opponents, on the other hand, seem to often get forgotten. An opponent is someone who has the reverse stance, vision or ethos from you.
For example, an environmental not-for-profit must focus on other environmental and social charities being their collaborators… and, at times, competitors! They must also think deeply about, engage with and respond to organisations working in direct opposition to their vision and purpose. This might include major polluters, oil and gas companies and businesses destroying precious habitats.
You might want to add in or use other labels here, such as peers, counterparts, rivals, enemies, challengers, antagonists or something else. It’s up to you to find the stakeholder management language and labels that resonate best with your organisation.
What does stakeholder management actually mean?
What is a stakeholder management plan or stakeholder management strategy?
A stakeholder management plan or stakeholder management strategy directs and guides how you engage with your stakeholders. We’ve outlined a step-by-step process for creating one, including some templates, below:
#1 Define your outcomes
First, define the outcomes you’re seeking from your stakeholder management activities. This should be connected to your organisational strategy, including your vision and purpose, or any relevant annual, operational, project plans etc. Being crystal clear on your stakeholder management outcomes then acts as your ‘north star’ for the remaining steps.
#2 Map your stakeholders
Next, list all of your stakeholders. We suggest getting a group together and doing this in a mind map format to make it a visual and interactive experience. This generally helps with brainstorming. You can proceed using adapted versions of the internal and external stakeholder categories we shared above or think about your stakeholders in terms of issues. Defining stakeholders on an issue-by-issue basis can make it easier to contact the right people when an issue-specific opportunity or challenge emerges.
To continue with the environmental not-for-profit example, you might group your stakeholders in terms of issues such as air pollution, water pollution, deforestation, species extinction etc.
#3 Prioritise your stakeholders
You now probably have a lengthy set of stakeholders… and limited resources, which means you can’t engage with all of them all of the time. It’s important to think about who will be most impacted by the work you do, who is most interested in what you’re doing and who has the most power to influence the outcome. This applies to both supporters and champions as well as opponents and detractors. These are your organisation’s priority stakeholders. You can identify primary and secondary stakeholders, or even rank them in order of priority from 1-X. You may find some of the stakeholder management tools we summarise in the next section – such as the power-interest matrix – useful in helping you to prioritise.
#4 Document key information
For your key stakeholders, it’s important to capture key information. This can include:
Whether the stakeholder supports, opposes, doesn’t care about or isn’t aware of what you’re doing
Their power or influence
Their interest or engagement
Whether they are an external or internal stakeholder
The issue(s) they care most about
Other relevant information
A couple of example stakeholder management tables are included below. You can tailor these to be suitable for your own stakeholder management plan requirements.
Stakeholder status table
c = current status d = desired status
Stakeholder summary table
#5 Identify activities and assign resources
With your outcomes clearly defined and your stakeholders mapped, prioritised and documented, it’s time for a stakeholder management action roadmap with assigned resources. This roadmap is a critical part of your stakeholder management plan. Keep in mind that important stakeholder relationships will ideally be supported by more than one team member and department, though we do recommend that there is a designated lead (or owner) for each priority stakeholder.
We’ve provided another table which you can adapt and use as part of your stakeholder management plan.
Stakeholder management action plan
#6 Implement the plan
Now that you have a stakeholder management strategy and associated action plan, it’s time to implement. This is when the rubber hits the road and you translate theory to practice. In our experience, it’s important here to embed implementation across your organisation so you can leverage your team and board’s collective passion, networks, expertise and capacity.
#7 Monitor and review the plan
As with most other things, stakeholder management is not a set and forget activity. It’s critical to continually monitor and evaluate the implementation of your stakeholder management plan. Ask yourself questions like: what are our general reflections when it comes to our stakeholder management strategy and its implementation? Which relationships are going in the direction we hoped? Which aren’t? Why? What’s working well for us? What’s not been as effective? Are there stakeholder relationships we could ‘dial up’? Are there others that we’re over-investing in? What changes will we make to improve the next iteration of our stakeholder management plan?
A note here to beware ineffective legacy stakeholder relationships. These are often engagements, collaborations or partnerships that have been around for a long time, require sometimes significant resourcing and investment but produce very little in the way of results. In instances such as this, we suggest revisiting your vision, purpose and impact, and seriously considering if your time and effort could be better allocated to other stakeholder relationships or activities.
What are some good stakeholder management tools and techniques?
There are many tools and frameworks to support organisations with stakeholder management. In addition to the tables and templates we shared in the previous section, we’ve highlighted a couple of our go-to stakeholder management tools below.
Power-Interest Matrix
Developed in 1991, the power-interest matrix is also known as Mendelow's Matrix and Mendelow's Stakeholder Matrix. This two-by-two has power along one axis, which is defined as the ability of the stakeholder to influence the project, program or strategy. Interest sits on the other axis, which refers to the stakeholder’s level of engagement and attention with the initiative at hand.
IAP2 Public Participation Spectrum
While initially designed when considering engagement with the general public, the International Association for Public Participation (IAP2 International) Public Participation Spectrum can also be applied to broader stakeholder management. This framework asks you to consider the level of engagement that is required. We’ve summarised and updated the engagement levels to apply to stakeholder management as follows:
Inform = provide information to this stakeholder
Consult = seek feedback from this stakeholder
Involve = engage in two-way dialogue
Collaborate = meaningful partnership in the process
Empower = ensure this stakeholder is the ultimate decision-maker
See below for an adapted template which you can use as a stakeholder management tool.
How does not-for-profit stakeholder management interact with government engagement, advocacy and government relations?
There are a number of ways that stakeholder management interacts with advocacy and government engagement. Firstly, if government stakeholders see that you’re supported by members of the general public and other partners, that can have a positive influence on how government views you. After all, politics in many ways is a numbers game (including when it comes to elections), so having a sizable stakeholder network (and therefore connections with numerous voters) can be valuable. To effectively communicate this information to government, we work with our clients to literally count their stakeholders – including employees, volunteers, customers/clients, partners and suppliers – on an electorate-by-electorate basis.
Another way stakeholder management can benefit government engagement outcomes is when it comes to your detractors. Effective stakeholder management can minimise the number and intensity of your opponents, which can help to reduce any political fallout or backlash.
A couple of additional points relate to collaboration and coalitions. Increasingly, government looks favourably on organisations known for partnership and cooperation. Stakeholder management can help identify new collaboration opportunities and bolster existing ones. When done well, stakeholder management can also open up opportunities to build coalitions. These alliances of many organisations can amplify your message, which can have ripple effects when it comes to policy, legislation, funding and ultimately impact. Coalitions can be especially important when you’re dealing with complex or large issues. Keep in mind that it’s essential that any coalition or alliance has a clear shared vision with people singing from the same hymn sheet, figuratively at least!
How do we approach stakeholder management at Tanck?
A number of features characterise our stakeholder management services and approach at Tanck. We’ve included a quick summary of each below.
We’re proactive and strategic. With everything going on, it’s easy to fall into a rhythm of reacting and responding. Constantly putting out fires is stressful and exhausting, and rarely gets the best outcome. We help our clients think ahead and think strategically. Key to this is developing a stakeholder management plan with a clearly defined direction and articulated priorities. Having a stakeholder management strategy helps get everyone on the same page to drive the greatest possible impact.
We have an unwavering focus on outcomes and impact. At Tanck, the vast majority of our clients are not-for-profits and all of the work we do is for-purpose. This means all of our clients exist to make the world a better place – one that’s more just and sustainable. This really matters, both to our clients and to our team. That’s why we make sure to keep focussed on the outcomes and impact our clients are working towards at all times. This is why our step-by-step stakeholder management process starts with outcomes.
We apply a political lens. Our team know the machinations, challenges and aspirations of government… because we’ve been on the inside. That’s why we adopt a political lens when helping our clients with stakeholder management. While we recognise that not all stakeholder management is directly about government engagement, we’re cognisant that a careless decision here or there can jeopardise meaningful government relationships in the blink of an eye.
We take your resource reality into account. Many of our clients are not-for-profits. They range in size from small organisations to big, high profile entities. Many have significant resource constraints and all have some form of resource limitation. When developing stakeholder strategies and associated action plans, we factor in the available resources to enable progress that doesn’t burn the team out.
We transfer knowledge to build capacity and capability. You’ve probably had the experience of working with a consultant who squirreled away behind closed doors and provided you with a shiny report. At Tanck, that’s not our style at all. We collaborate with our clients to build skills, knowledge and confidence. That means when we part ways, the expertise and experience has been embedded in-house and continues on.
We deploy a whole-of-organisation approach. We talk a lot at Tanck about structural and systemic approaches. What do we mean by this? Well, for us, this is about breaking down siloes and stereotypes to maximise all of the people and resources in your organisation. Of course your board and executive have an important role to play in stakeholder management but so do your frontline staff, administrative team members and subject matter experts. Our stakeholder management plans tap into the collective capacity, talent and connections of your whole organisation, rather than just one or two high profile leaders.
We bring it back to the people. Great stakeholder management is ultimately all about strong relationships with and between people. While data, number crunching and strategies all have a role to play, we make sure to put people at the centre of all our stakeholder management activities. (This includes reminding our clients that politicians are humans with feelings too!) We’re also friendly and responsive to work with, both helping our clients navigate the crises and challenges as well as celebrate and bask in their wins.