• News & Insights
  • Fundamental Keys to Building Relationships With Stakeholders

Fundamental Keys to Building Relationships With Stakeholders

Picture this: you’re at the end of a long consultation process. You have all the key people in the room, ready to vote on a decision that will let your project move forward. You call the vote and…three key stakeholders cast their vote against it. 

You’re in shock. You were so sure you had all the key people on board. But it’s clear now that somewhere along the way, you didn’t build the right relationships with stakeholders, and now your project is back to square one. 

Let’s take a look at how to avoid this scenario in the future. 

Identifying Stakeholders

If you want to create change or make a decision affecting people other than yourself, then you’ll end up interacting with stakeholders. Success in this arena means building good relationships with them.

Stakeholders are people who have a ‘stake’ in the change you’re wanting to create. They could be funders, your boss, your employees, interested parties, or anyone who will be impacted by the project.

For example, if you wanted to build a house on your land, the stakeholders would be your bank (financing) your local council (permissions) your builder (execution) your spouse (key stakeholder) and possibly your neighbours. 

Successfully building your house will involve getting buy-in from all of these stakeholders. Each of them has a different interest in your project and will be affected by it in different ways. 

The principle of working with stakeholders to achieve your goals applies in every area of your business, career, and personal life. Therefore, learning how to do this with grace and economy is a vital key to achieving your life’s goals. 

Why Would You Want To Strengthen Stakeholder Partnerships?

Having strong relationships with stakeholders means the decisions you agree on will actually be carried forward. For example, in a work environment, employees may appear to agree with their boss’s decision to boost productivity by only checking email between certain times.

However, their main reason for agreeing is that their boss is the one paying them. They haven’t bought into the decision on a deeper level, and therefore as soon as the boss’s back is turned, they start checking their inbox every five minutes. 

In this scenario, the decision was made without stakeholder buy-in. The relationship between the boss and employees wasn’t strong enough for them to make their true objections made. Therefore a genuine agreement wasn’t reached.

The outcome: there was no real execution of the decision. 

On the flip side, when you have a strong stakeholder partnership, decisions are made with real participation and agreement. People will say which parts of the plan they think are unworkable, and a real solution can be reached that everyone truly supports. 

Done in this way, the stakeholder relationship involves openness and trust. This leads to the stakeholders supporting and carrying out the agreed-upon plan. 

How Do You Build Trust With Your Stakeholders?

There are four fundamental tools for building trust with stakeholders.

The first one is affinity. Affinity can be characterised as a feeling of liking and interest toward another person. Building this is a key ingredient for trust. (It’s hard to trust people you don’t like.)

The second is shared reality. When you seek to build trust with someone, the first thing you want to check is whether you share the same views on key issues.

For example, when working on town policy, environmentalists and town planners will frequently clash. This is because they have a very different reality, and a different idea of what success looks like. 

Communication is the third tool for building trust. Without clear, effective communication, you can’t find out what someone else’s reality looks like, or build affinity with them. In our experience, good communication involves asking a lot of questions to clarify each stakeholder’s position. 

The final tool is understanding. When you have a shared understanding, all other tools become easier. Many times, stakeholders disagree because they don’t understand the other party’s point of view. They don’t know what the other person’s concerns are, and therefore they don’t put any thought into how these could be resolved. 

When you spend time communicating to build affinity, understanding, and a shared reality, then trust is the result. 

Fundamental Keys To Building Stakeholder Partnerships

Once you have established trust, the next step is partnership.

What Is Partnership With A Stakeholder?

Partnership implies both parties have an interest in the project succeeding. Often projects are delayed or blocked entirely because key stakeholders haven’t been consulted or brought on board.

Creating a partnership with your stakeholders is the key to success. Once you are in partnership, the resistance to getting your project done disappears.

Once partnership is achieved, your agreement can go from an abstract concept to active execution. While it’s important to maintain trust throughout the execution phase, another dynamic comes into play here.

The key to building stakeholder partnerships is cooperation. With cooperation, a partnership can weather the changes and course corrections that are part of getting a project done. 

There are three keys to creating cooperation between stakeholders, which we’ll outline below.  

  1. A Shared Brightness of Future.
    True cooperation means putting the overall goal ahead of your personal agenda. People will do this if they believe the future they’re working towards is worth it. This is why building understanding and shared reality is so important. Unless you all have the same vision of the future, it’s easy for stakeholders to end up working against each other.
    A shared brightness of future is both an inspiration and a focus for everyone involved. Great leaders are able to create a shared brightness of future for their followers and stakeholders, and this is how they inspire great action and cooperation.
  2. Frequency of Interaction.
    To make cooperation smooth, it’s important to meet regularly. This builds the stakeholder relationship and allows you to revisit your shared future. It also makes it possible to adjust course as circumstances change.
    Without frequency of interaction, agreements are forgotten and partners move on to something more urgent or engaging.
  3. Provoke-ability.
    In normal English, this word doesn’t exist. Its closest relative is ‘provokable.’ However, writing it like this: ‘provoke-ability’ breaks it into its key components. In essence, this word means ‘the ability to be provoked,’ and it is a key part of cooperation.
    In any endeavour, there will come times when stakeholders (or yourself) break the tenets of the agreement you’ve made. When this happens, the other parties’ provoke-ability describes their willingness to point out how the agreement has been broken, and then put things back on track.
    Someone skilled at communication will be able to point out a difficult truth without causing a fight.
    The key element of provoke-ability is that it only works when it applies in all directions. When provoke-ability is only applied in a top-down manner, you get rebellious and unengaged subordinates.
    If employees are able to point out to their employer when the boss has broken an agreement, this leads to a truly cooperative environment. Everyone keeps to the spirit of the agreement because anyone can be called to account when this is not practised. 

When stakeholders are truly in cooperation, a partnership is formed. This means everyone has bought into the goals of the project and taken personal responsibility for seeing their part through.

This kind of stakeholder relationship can take time to build and maintain. However, it’s infinitely preferable to an agreement where some of the parties involved are working to sabotage the success of the project. 

A successful project is ten times easier to achieve when your stakeholders are true partners in the process. 

How do you communicate with stakeholders?

The first step is to identify who the stakeholders are. This often means casting a wider net than you may have originally thought. 

Stakeholders in a project will include direct stakeholders: 

  • those involved in working on the project
  • those who will be directly affected by the project’s success or failure

It also includes indirect stakeholders: 

  • people with an interest in the project
  • those who influence the decision makers on the project
  • people who are to be kept informed on the project’s progress

Once you’ve drawn up a list of all your stakeholders, the next step is to create a communication plan. 

This is where the shared brightness of future and frequency of interaction are once again important. Communication with shareholders works best when it is:

  • frequent
  • clear
  • two-way

Communication is never a one-way street. Effective business communication with stakeholders means clarifying questions they have to reach a shared understanding. This is never accomplished by one-way communication on auto-pilot. 

Summary

You’ve just learned the keys to building relationships with project stakeholders. This includes being able to create:

  • trust
  • cooperation
  • partnership

The ultimate goal is stakeholder partnership. This is achieved by effective communication,  taking the time to build understanding, and then agreeing on a shared objective. 

ABA has a flagship course on communication, which will allow you to practice this vital skill at a high level. This will enable you to create partnership and cooperation, even with stakeholders who may at first appear to be misaligned with your goals. Here’s where to find out more.

Latest news and insights

Gain valuable insights into effective sales and leadership strategies.

Are You Actually A Successful Business Owner?

Read Full Article

The Nine Divisions of Your Business

Read Full Article

The Importance of Business Networking Can’t Be Understated

Read Full Article