We know the importance of having a strategic stakeholder engagement plan, but let's not forget the value of building strong stakeholder relationships and how effective stakeholder relationship management can contribute to your organization's and project's success.
How do relationships with stakeholders determine organizational success?
Strong stakeholder relationships are fundamental to project and organizational success. When stakeholders feel engaged and valued, they're more likely to support your goals, provide honest feedback, and participate collaboratively - significantly increasing the chances of a positive outcome.
Open, consistent communication helps identify and address concerns early, preventing misunderstandings and mitigating risks before they become significant issues.
Conversely, poor stakeholder relationships can lead to resistance, delays, reputational harm, or project failure. Without trust and transparency, stakeholders may withhold vital information, oppose project plans, or escalate conflicts.
How can relationships with stakeholders impact a project's success?
1. Strong stakeholder relationships help build a good brand reputation
Your reputation precedes you
Focusing on building your stakeholder relationships and your willingness to engage respectfully, consistently, and transparently affects how people perceive your projects and organization. Positive perception helps make your organization's reputation with people directly and indirectly.
Your reputation can affect people's perception of your organization even before they interact with you due to sharing (e.g., word-of-mouth). With a good reputation, this sharing can work in your favour, as a stakeholder may communicate positively about your organization (e.g., online or in person) on your behalf, which can be extremely valuable during turbulent times or when trying to gain support.
Stronger trust
Trust is essential when building relationships; you gain trust by being reliable, honest, and respectful. Listening is also critical when it comes to building trust with your stakeholders.
When you incorporate these trust-building elements into your engagement, you work towards building stronger relationships with stakeholders whose belief and support in your organization will strengthen your reputation, helping to ensure the future success of your projects and your organization.
To learn how an SRM can help you build stakeholder trust, check out our blog →
2. Strong stakeholder relationships help ensure the success of future projects
People support what they help create
Even if you cannot incorporate every stakeholder suggestion or concern, respectful and timely stakeholder engagement helps your stakeholders feel heard and valued. This type of engagement increases the likelihood that your stakeholders will support your organization, even if they don't support your current project.
Stakeholder relationships are not "one and done"
You could encounter stakeholders from your current project again in the future, so building a good relationship with them early on can help to ensure the success of your current and future projects.
3. Strong stakeholder relationships help to lower organizational and project risk
Open communication
If you have established relationships with your stakeholders, the chances are better that they'll come to you when an issue arises, so you can work to find a solution.
Without a relationship in place, your stakeholders will go where they feel heard and valued to share their displeasure (e.g. their social media followers). When stakeholders don't feel like they can trust you with their concerns, your reputation and project are at risk if issues go unresolved or snowball out of your control.
Address issues and commitments
Issues and commitments are common in stakeholder engagement and consultation, and there is no surer way to destroy your relationships than by failing to deal with them effectively and quickly.
However, with stakeholder relationships already in place and by choosing to engage effectively and consistently, you can help avoid escalation, which is crucial as escalation can magnify a minor issue into something much more significant and riskier.
With stronger stakeholder relationships, you'll be able to work through obstacles more quickly and effectively, helping to keep your project on schedule, protect your reputation, and move your organization forward.
For tips on managing stakeholder issues, visit our blog →
Traceability and accountability
Tracking your interactions with stakeholders allows you to stay on top of what's been said and what's been promised.
Tracking engagements keeps everyone accountable for their engagement, concerns, and actions. Understanding where a comment, issue, commitment, or task came from means having traceability within your engagement program, and it can go a long way toward better understanding your stakeholders and improving outcomes.
Good traceability and accountability lower project risk. You can better prepare for and plan for any upcoming concerns and deal with them more effectively to keep your projects on track and your organization protected.
How do you build strong stakeholder relationships?
As an organization, it's essential to remember that when building relationships and designing your stakeholder engagement plan, it's not just about how you engage; it's what you do with that engagement information that can make a big difference, too.
Developing a repeatable and scalable process for stakeholder relationship management is essential for building strong stakeholder relationships, which is why utilizing Stakeholder Relationship Management (SRM) software is key.
We designed Jambo, our SRM software, to help you track and organize all your relationships and engagements with your stakeholders and set you and your team up for success. Jambo enables you to track all your communications, issues, commitments, tasks, and stakeholder contact information. Having all this information in one easy-to-understand place lets you and your team stay on track and focus on the essential tasks.
Next steps
To learn more about Jambo's uses and features, check out our one-minute explainer video by clicking below!
