7 Benefits of Stakeholder Engagement

How many times have you developed a stakeholder map for it to end up lost? You resurrect it when trouble hits or you’re required to demonstrate that you’ve ‘done’ stakeholder engagement. So what are some of the benefits of stakeholder engagement?

Business is about relationships – whether you’re start-up or a large business, government, or an NGO.

The success or failure of any policy or product starts and ends with stakeholders. Failure to engage can cost time, money and reputation, and lead to a great idea going nowhere.

Engagement is an ongoing process throughout the lifecycle of your policy or product.

In this post, I’ll be outlining some of the benefits, and pitfalls, of stakeholder engagement. I have also written about some of the key principles of stakeholder engagement here. 

What is stakeholder engagement?

Stakeholder engagement is the process by which an organisation involves people who may be affected by the decisions it makes or by its implementation.

It is more than just communication. Communication will only give a sense of ‘yes’, ‘no’ or ‘maybe’. Developing an understanding of what people are thinking and saying requires both listening and responding.

7 Benefits of Effective Stakeholder Engagement

 Learning

Engaging with different perspectives provides opportunities for learning and potentially changing your approach to ensure it fits the needs of stakeholders.

Over the years I’ve worked with hundreds, if not thousands, of stakeholders on a range of issues. From global experts to the general public, it’s led to sometime unexpected insights. Most importantly, it’s lead to better policy and programmes – with assumptions and approaches tested and refined throughout. It’s also provided rich insights into people’s own experiences. 

This was not always easy, nor comfortable, but it was necessary to develop programmes that work.

 On decision-making

Understanding the views and interests of your stakeholders can lead to more effective decision-making.

This is more than just getting the language right. In understanding issues and concerns, it provides an opportunity to reflect on what will and will not work, and why.

 Saving time and money

Engaging early can lead to savings of both time and money in the long term.

I can’t stress enough the importance of early stakeholder engagement. This is not only critical to developing a robust policy or product, but to develop a real understanding of needs. Start on implementation before it, it’s likely you’ll need to go back to the drawing board.

Trust

Effective stakeholder engagement is critical to building lasting credibility and trust – in your organisation and/or product.

 Risk management

Being open to different can improve risk management through potentially highlighting issues you may not have been aware of and help you prioritise.

Accountability

Engaging with stakeholders is central to improving accountability within your own organisation as well as to the wider market. Transparency is important – be clear about the outcomes you are hoping to achieve and the steps on the way.

 Understand needs

Understanding the full range of needs and views can let to better policy making and better outcomes.

Costs of stakeholder management

• It takes time and money – this goes without saying. But it’s likely it will cost a lot more if you need to start again or spend time repairing relationships.

• Information is never perfect. Incorporating everyone’s views can lead to indecision.

• There can be conflict and a loss of control of the agenda. While stakeholder engagement is very much on ongoing process, it’s important to timeframe what decisions will be taken when so you can progress.

On balance, effective stakeholder engagement will always win-out.