The risks and rewards of stakeholder management

stakeholder management

By Kim Ho, Journalist, Infrastructure Magazine

Stakeholder management is widely considered to be integral to the successful delivery of infrastructure projects, but it is not without its challenges. Miscommunications, conflicting stakeholder interests and misaligned engagement strategies can seriously disrupt project outcomes and timelines. Infrastructure spoke to industry leaders across each transport sector to discuss these challenges and their strategies to overcome them.

On paper, the principles of stakeholder management seem straightforward. Once potential stakeholders are identified, project managers must determine their interests in the project and their degree of influence over it, establish an engagement plan, and maintain consistent and transparent communication.

In reality, however, engaging and satisfying stakeholders is a complex process that demands considerable time and effort throughout all stages of a project’s planning and delivery cycle. There are lots of factors at play and any one could cause issues.

Planning must start early

Stakeholder management is an enormous, time-consuming operation. One of the biggest challenges is allowing enough time to establish effective ongoing communication.

Brenton Cox, Executive General Manager – Finance and Corporate at Adelaide Airport, said the Airport aims to start stakeholder management during the early planning and design stages of a project, rather than waiting until work has commenced.

“It is easy to underestimate the scale of the consultation task and the resources and time required,” Mr Cox said.

Krishan Tangri, General Manager, Assets Group at Brisbane Airport Corporation, shared this view, saying the time constraints make it crucial that companies get it right at the start.

“It is essential to work closely with project managers from inception to establish the rules of engagement around communications, and to take the time to ask and agree what success looks like,” he said.

Mr Tangri stressed that the groundwork done on each project or asset – identifying key stakeholders; mapping them according to their role on the project; stating their impact, interests and levels of influence; shaping engagement activities accordingly – is only part of the process.

For successful stakeholder management, project managers also need to allocate time for continuous evaluation of both stakeholders and their own process.

“During and at completion of our projects, we assess the level of satisfaction of each key stakeholder and develop strategies to continuously improve,” Mr Tangri said.

A project’s scale and geographic spread need to be considered

The time commitment of stakeholder management is proportional to a project’s scale. The bigger the project, the more stakeholders will be involved and the greater the likelihood of divergent and even conflicting interests.

Rebecca Pickering, Director – Engagement, Environment and Property for Inland Rail, said the Inland Rail program covers a distance longer than the whole of New Zealand and involves a vast number of stakeholders.

The project itself is the largest freight rail infrastructure project in Australia, with the construction connecting Melbourne and Brisbane via regional Victoria, New South Wales and Queensland.

“Delivering a major infrastructure programme along 1700km and three states touches thousands of stakeholders with different needs, different impacts, different interests and different questions to be addressed,” Ms Pickering said.

Ms Pickering said that over 8000 people have participated in Inland Rail’s engagement activities so far.

“We have facilitated more than 3000 stakeholder meetings in the past two years, we’ve held more than 400 community sessions, we have around 1800 land access agreements in place, and we’re liaising with about 36 councils and 26 traditional owner groups.”

As the alignment is a mix of brownfield and greenfield sites it means there are varying environments, topography, and engineering solutions at play as well as differing state planning and approvals processes required.

“With so many, and such a diverse range of stakeholders across a broad geographic spread, we are applying a range of traditional and digital means to bring the community to the centre of Inland Rail,” Ms Pickering said.

These strategies include one-on-one engagement; neighbourhood and small group consultation and conversations; Community Consultative Committees; participation in local community events such as regional agricultural shows; community information sessions and digital engagement platforms.

Avoiding misaligned stakeholders

While seeking input from a great number of stakeholders may complicate a project’s objectives, Mr Tangri maintained that attempts to cater to diverse interests can yield benefits down the track.

“I believe Brisbane Airport will be developing its thinking into a ‘servicing all’ concept – i.e. serving all categories of stakeholders – which will bring longer term efficiencies over time,” he said.

However, he agreed that misaligned stakeholders can be the biggest contributor to a project’s failure to meet key milestones.

“It is important that the engagement is targeted to specific information needs and concerns without spamming our stakeholders,” Mr Tangri said.

It’s all about transparent communication

 

Once stakeholder engagement has begun, the challenge is then to maintain consistent, transparent communication with all involved.

A spokesperson for the Queensland Department of Transport and Main Roads (TMR) said that the organisation’s typical stakeholders include the local community, Indigenous groups, individuals, special interest groups, telecommunications providers, political representatives, media and, at times, other projects.

“The nature of our business brings us into contact daily with all tiers of government, as well as broader industry and business groups and single issues groups with specific local community issues at heart,” the spokesperson said.

To ensure full disclosure and transparency with across these groups, TMR has put established systems, policies and protocols in place for engaging with stakeholders.

This includes representation on committees and working groups, on-site visits, a presence at community expos and events, official parliamentary correspondence, community mailouts, responding to media enquiries and issuing department media statements and online project updates.

Crucially, TMR developed these protocols based on feedback from its stakeholders.

“We engaged our customers to research, design, develop, and publish a whole-of-TMR Customer Charter that clearly outlines what our customers can expect from us as well as what we will deliver,” TMR’s spokesperson said.

“This Customer Charter underpins our philosophy and approach to stakeholder engagement within a corporate project management framework.”

Queensland Department of Transport and Main Roads’ Integrated Project Management Framework, which aims to provide an overarching view for project managers who plan and deliver infrastructure projects, also evolved from consultation sessions across Queensland.

Determining project value

Part of the challenge of effective communication is to articulate a project’s value to stakeholders.

Ms Pickering described Inland Rail’s approach as bringing its stakeholders along on the journey of the project’s construction.

“We want to make sure stakeholders understand the true economic benefits of how this program is going to make a difference to them and to the country,” she said.

Steve Doran, Director and Founder of asset management consultancy Infrastream, regularly helps clients to navigate complex stakeholder management scenarios and said the challenge of determining true project value is made more difficult by value to community stakeholders being most often intangible.

Mr Doran said that communicating project value with a focus on how their own quality of life will be improved can be the pivotal difference in gaining stakeholder acceptance.

For him, it is essential to plan and budget for the engagement activity as if it is the most significant investment in terms of true value return – because it is.

This can be seen on the Inland Rail Project as ARTC has allocated more than 40 people to carry out stakeholder engagement, communication and media roles across Queensland, NSW and Victoria, aligning with the 13 projects along the route from Melbourne to Brisbane.

“Leveraging the opportunities this nation-building program brings on a local level is paramount, and that is where the two-way communication is critical,” Ms Pickering said.

Conveying incalculable value

Perhaps the most significant challenge of stakeholder management is enabling this reciprocal communication, to make a real attempt to actively listen and incorporate feedback where possible.

This includes genuine communication, having empathy, active listening and not just performative responses that are simply going through the motions. Mr Cox said for Adelaide Airport it is important to be available for briefings or information requests.

“Some simple empathy helps, by identifying key stakeholders and putting yourself in their shoes and trying to pre-empt some of the issues they are likely to have,” Mr Cox said.

Mr Doran echoed this sentiment and said it is essential to take the time to understand the stakeholders’ position and circumstances in detail, even if strong opposition is expected.

“Consultation that is simply carried out to tick this off as completed, with conclusions already decided, is fraught with danger for the project,” he said.

Ms Pickering also said it was important to acknowledge the perspectives of the various local communities impacted by a project like Inland Rail with patience and humility.

“No one knows the local area like the people that live there,” she said. “Local knowledge is absolutely essential to the design and ultimate success of this project.”

High stakes = huge consequences

Just as there are myriad challenges to stakeholder management, so too are there many ways an insufficient approach could negatively impact a project’s progress and outcome.

Delays, missed milestones and adjusted project outcomes are all feasible consequences, but they are not the only concerns. Poor stakeholder management can also impact public perception.

However, these risks illuminate just how integral stakeholder management is to safeguarding a project’s success.

Effective communication and engagement can keep projects to schedule and provide a sense of accomplishment at project completion which can be shared, boosting reputations and alliances.

“Stakeholder management is a lot more than just ensuring that the project receives a positive reception,” Mr Cox said. “It can also draw out issues that are minor when addressed early on, but which could derail the project if they emerge later in the process.”

In this way, stakeholder management dovetails into project risk avoidance. Mr Tangri put it simply; “Without our stakeholders there will be no project.”

Is face-to-face consultation becoming obsolete?

Despite a diverse range of strategies to achieve meaningful engagement and open communication, all of these industry leaders were unanimous in their prediction of the future of stakeholder management.

“Demand for stakeholder engagement is only going to increase,” Mr Cox said; and with it, a demand for “real time information leveraging technology, not just social media”.

The consensus held is that in the future stakeholder management will be increasingly carried out using online, digitised application-based methods.

Brisbane Airport is currently working on a pilot online stakeholder engagement portal, which aims to provide an engaging single source of real-time information for its internal and external stakeholders.

“Not only are these methods making communication more efficient, they will also facilitate greater interactivity with stakeholders,” Mr Tangri said.

Similarly, Inland Rail is using visualisations that show how solutions will sit with the local environment, as well as interactive maps and online panels to enable locals to input feedback directly at their convenience.

Yet despite these burgeoning technological paths, stakeholder management is not set to go completely digital any time soon. Common to all sectors’ approaches was a continuing commitment to in-person communication.

“Nothing replaces face-to-face conversation,” Ms Pickering said.

Ultimately, the imperatives of empathy, transparency and active listening will always be essential to successful stakeholder management on Australia’s infrastructure projects.

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