Are you anticipating a major change in your organization? While it might be tempting to jump into the process full throttle, it pays to, first, lay a solid foundation.
There are many people whose influence, control and opinion could determine the overall success of your business transformation or ERP implementation. Balancing their perspectives with your evolving business needs is critical to ensuring a smooth path forward. These key individuals can be the linchpin in the eventual outcome of your project.
Today, we’re sharing some of the reasons to include a stakeholder analysis in change management efforts. While you may understand the importance of change management, do you understand the importance of a stakeholder analysis – a critical success factor that should be included in every change management plan?
How is a Stakeholder Analysis Used in Organizational Change Management?
Maybe you’ve decided to create a new digital business model. Or maybe you’re consolidating your disparate data into a comprehensive enterprise resource planning (ERP) solution. In either case, there will be many different stakeholders that want a say in the project.
Some stakeholders might be more interested in the financial management aspects while others will have a greater stake in the technology side. Then, there will be those who are looking at the change from a C-suite point-of-view and are concerned with the greater implications on your company’s enterprise strategy.
How do you understand all these stakeholder needs? We recommend conducting a stakeholder analysis. This is a matrix that helps you strategically determine how to effectively manage stakeholders.
As you create this matrix, you’ll categorize each stakeholder based on their level of influence and their level of desire to be change advocates/champions. From there, you can more easily see how to approach each individual, while allowing varying degrees of control and input.
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Examples of Internal Stakeholder Groups
When you’re ready to begin a stakeholder analysis, it’s important to recognize the different internal stakeholder groups. While this will differ from company to company, these groups usually include:
- Key executives
- Project sponsors
- Subject matter experts
- Process owners
- Business unit leaders
- Individual end users
Each of these groups will have individuals with unique skills, perspectives and pain points. Applying a generic approach to every stakeholder can be a recipe for disaster.
Together with your change management team, it’s important to consider how each group might respond to news of the change and how you should communicate with each individual and/or group.
4 Reasons to Include a Stakeholder Analysis in Change Management Efforts
With so much going on as you prepare to launch your project, why should you take the time to conduct a stakeholder analysis? Let’s take a look at a few of the top reasons why this is an essential step:
1. To Understand Stakeholder Needs and Perspectives
There are many stakeholders who have direct control over whether your project gets funded. At the end of the day, if they don’t understand the project, they won’t support it, which could undermine your efforts.
A stakeholder analysis allows you to understand the needs and perspectives of these decision makers, as well as other individuals who influence different stages of the project.
What are their motivations and objectives? What changes would they like to see? When you consider how each person might feel about the current state and what they expect from organizational change, you can balance their needs with the overall business needs. You can also identify any barriers or misalignment that might impede your progress.
2. To Detect Change Resistance and Increase Commitment
With any enterprise-wide change, you run the risk of experiencing change resistance. Even if the change will benefit the company and solve pain points, employees often hold tight to the familiar. This is especially the case when new technology, such as an ERP system, is introduced.
While you might expect this sort of hesitancy from end users, it’s easy to forget that executives can also resist large-scale change.
Regardless of who is pushing back against proposed changes, a stakeholder analysis allows you to identify attitudes and opinions that may signal some level of resistance. Once you can clearly see this resistance and have identified the strongest sources of resistance, you can determine the steps necessary to increase project commitment and buy-in.
3. To Determine a Stakeholder Engagement Strategy
A stakeholder analysis can help you design an engagement strategy to ensure stakeholders are participating in the project as required.
Again, this isn’t a generic approach, but one that requires careful customization. For example, some stakeholders will only require regular, informative updates about the project, while others should be involved in business process reengineering efforts. Still, others should be fully engaged in the project as change champions.
This goes back to the categorization we mentioned earlier where you determine the level of influence each stakeholder has along with their level of interest in being a change advocate.
4. To Determine Appropriate Messaging and Tactics
A stakeholder analysis helps you craft compelling messages that resonate with each identified stakeholder. Your messaging will correspond with each individual’s pain points, attitude toward change and level of influence.
The messaging you use for change advocates will, of course, be different than your messaging for end users. While the basics of your elevator pitch will stay the same, you will need a different emphasis depending on each group’s pain points. You also will be setting different expectations depending on each person’s role in the project.
Successfully Conduct a Stakeholder Analysis in Change Management
The success of your project hinges on the attitude and actions of each individual who is impacted by organizational change. These people will either champion the change, or they will rally against it. They will either readily embrace new processes and technology, or they will perform workarounds.
You know what organizational change management success looks like, so why not conduct a stakeholder analysis to ensure everyone responds to change in way that helps you achieve your business goals?
Request a free consultation below to learn how our organizational change management consultants can help you perform this analysis with the correct level of detail.