Do stakeholders interests coincide with policy goals? Evidence-Based Policy Making Module Eduardo T Gonzalez Development Academy of the Philippines

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1 Do stakeholders interests coincide with policy goals? Evidence-Based Policy Making Module Eduardo T Gonzalez Development Academy of the Philippines

2 Outline Why analyze stakeholders? How to do stakeholder analysis Who are the stakeholders? Power, interest, influence, importance An example

3 Stakeholder analysis An assessment of a project s key participants and the extent to which their problems, needs and interests are affected by the project The first step in building relationships with those responsible for project success A key determinant of project readiness - provides information on how to manage stakeholders and proceed successfully Helps address implications if stakeholders change.

4 What it does Identifies characteristics and interests of people, groups and institutions that will influence the policy or project (either positively or negatively) Anticipates the kind of influence these groups will have on the project Measures capacity of stakeholders to participate in the project Predicts participation by different project phase, i.e., system planning, definition, acquisition, and implementation - In a rural livelihood project, rural poor are key stakeholders. NGOs could be involved at different stages providing local knowledge and outreach

5 What it does Identifies ways to neutralize or reduce negative impacts on vulnerable groups Develops strategies to get the most effective support and build on opportunities and relationships Pinpoints risks and potential conflicts of interests between stakeholders - A flood control policy could benefit farmers through increased yields, but it may adversely affect fisherfolk whose catches go down. The fishermen could try to block the policy by breaching embankments

6 Benefits of using a stakeholderbased approach You can use the opinions of the most powerful stakeholders to shape your project at an early stage. This makes it more likely that they will support you; their input can also improve the quality of your project Gaining early support from influential stakeholders can help you win more resources By communicating with stakeholders early and frequently, you can ensure that they fully understand what you are doing and understand the benefits of your project

7 When should a stakeholder analysis be carried out? It should be primarily used at the identification, design and appraisal stages in the project cycle, but should be undertaken throughout the life of a project because it fulfils different functions at different stages: Identification stage: purpose is to identify key stakeholders and decide how to involve them in design and appraisal; Design and appraisal: used as a basis for design and risk analysis Inception: used to plan the involvement of different stakeholders at start-up Implementation: used to ensure effective stakeholder involvement and to monitor key stakeholders opposed to it Evaluation: to review the involvement of different stakeholders in evaluating the policy or activity

8 Cautionary points Judgment needed if stakeholders are widely dispersed over an area Need to guard against skewing analysis by failing to take account of different views simply because some stakeholders may be (1) too powerful for comfort or (2) hard to reach! Key learning point: If in doubt, expand your planning horizon rather than exclude legitimate stakeholders

9 The stakeholders

10 Who are the stakeholders? Persons or groups or institutions with a stake in the project outcome Persons or groups whose problems, needs or interests are affected by the project, either positively (beneficiaries) or negatively (those involuntarily affected) Include both winners and losers, and those involved or excluded from the decision making process

11 3 main types of stakeholder Key stakeholders those who can significantly influence or are important to the success of an activity. Example: Rural roads project - Local politicians - Village leaders Some primary stakeholders may also be secondary stakeholders In reality, the distinction between them may not be clear-cut, with overlap between these main types

12 3 main types of stakeholder Primary stakeholders - those individuals and groups who are ultimately affected by an activity, either as beneficiaries (positive impact) or dis-beneficiaries (negative impact). Example: Rural roads project - small farmers and traders who are positively impacted by a new road; - households who are adversely affected (e.g. relocation due to road widening)

13 3 main types of stakeholder Secondary stakeholders - all other individuals or institutions with a stake, interest or intermediary role in the activity. Example: Rural roads project Local transport providers Public transport workers Ministry of Transport NGOs Funders

14 The Wider Environment Financial Beneficiary The Containing System stakeholders Onion model of Political Beneficiary Functional Beneficiary Consultant Sponsor or Champion Purchaser Normal Operator Operational Support The System The Product Policy/ project Maintenance Operator Interfacing Systems Negative Stakeholders The Public Regulator Developer

15 Influences on TV show project The Wider Environment Interfacing System The Containing System The System Competitor (Negative Stakeholder) Pressure to innovate Pressure to make TV show enjoyable User / Consumer TV audience Policy on TV shows Maintenance Operator Operational Support The Public Politician Director Shareholder (Financial Beneficiaries) Pressure to make profit TV show Manager (Purchaser) Media Regulator Pressure to regulate violent & sexual imagery Developer

16 How to do stakeholder analysis 3 basic steps: 1. Identify the main stakeholders and the reasons for their interest in the policy or activity using a Stakeholder Table 2. Identify the influence and importance of each and show them in a matrix 3. Identify the risks that may affect policy or activity design and discuss how they can be addressed

17 Stakeholder table Stakeholder Interest in Project Positive ( ) / Negative (x) Small farmers Higher output and incomes Food traders More sales Labourers More jobs Moneylenders Government officials Empowered clients Less business Success of project Possible loss of rent if farmers become empowered x X x

18 Forcefield analysis Identify what you want to achieve Identify forces for and against change Identify which are most important Develop strategies to reinforce those for and overcome those against

19 Checklist for identifying stakeholders - representativeness Have all primary and secondary stakeholders been listed? Have all potential supporters and opponents of the project been identified? Have primary stakeholders been divided into user/occupational or income groups? Have different types of female stakeholders been identified (using gender analysis)? Have the interests of vulnerable groups (especially the poor) been identified? Are there any likely new primary or secondary stakeholders that are likely to emerge as a result of the project?

20 Influence and importance Influence - degree to which a stakeholder can facilitate or impede the achievement of a plan s objectives Importance - degree to which stakeholders interests coincide with project interests. EXAMPLE: Rural livelihoods project - Local politicians may have a great influence over the project by facilitating (or impeding) allocation of resources, while the rural poor may have very little power to influence the outcome of the project. - At the same time, local politicians may have very little importance as far as the project is concerned (since it is not designed to meet their needs), while the rural poor are very important and central to it.

21 Where power derives For formal institutions power can derive from: Legal hierarchy (control and budget) Authority of leadership Control over strategic project resources Possession of specialized knowledge Strength relative to other stakeholders

22 Primary stakeholders For primary stakeholders and informal interest groups, influence can derive from: Social status Level of organization Consensus and leadership in the group Control over strategic project resources Informal influence and links with other stakeholders Degree of dependence on other stakeholders. Stakeholders can exercise their influence by: Directly controlling the decision-making process Facilitating/hindering the implementation process.

23 Assessing importance Importance refers to the extent to which the success of an on-going or potential project depends on fulfilling the needs of a stakeholder The most important stakeholders, therefore, are those whose needs the project seeks to address This will vary from project to project

24 Assessing power To assess the level of power for a stakeholder, ask the following: Which problems affecting which stakeholders does the project seek to address? For which stakeholders does the project place a priority on meeting their needs, expectations and/or interests? Which stakeholder interests converge with the project s objectives and results? Note: This might be easier for an on-going project than one that is being planned.

25 Variables affecting stakeholders' relative power and influence Within and between formal organizations Legal hierarchy (command and control, budget holders) Authority of leadership (formal and informal, charisma, political, familial or cadre connections) Control of strategic resources for the project (suppliers of hardware or other inputs) Possession of specialist knowledge (engineering staff) Negotiating position (strength in relation to other stakeholders in the project) For informal interest groups and primary stakeholders Social, economic and political status Degree of organization, consensus and leadership in the group Degree of control of strategic resources significant for the project Informal influence through links with other stakeholders Degree of dependence on other stakeholders Assessing importance to project success

26 Importance/Influence matrix A High Importance/Low Influence B High Importance/High Influence D C Low Importance/Low Influence Low Importance/High Influence

27 Importance/Influence matrix Boxes A, B, and C Key stakeholders have significant influence or are most important to meeting project s objectives Box A High importance, low influence require special initiatives if their interests are to be protected Box B High importance, high influence programme managers need to develop close relationships to ensure strong support Box C High influence, but interests not target of project. May block activities and could be risk to project s success. Box D Low priority but may need monitoring. Unlikely to be focus of program

28 Categories of stakeholders Category I - high importance, low influence Usually target of project May require special attention to ensure their needs are met and participation is meaningful Usually partner to control type of participation

29 Categories of stakeholders Category II - high importance, high influence Usually not targets of project Examples could include donor agencies, frontline government agencies Could use their importance and influence to support or derail project success Should be closely involved at all stages of project cycle to ensure their support and the project's success. Usually in the control to partner type of involvement

30 Categories of stakeholders Category III - low importance, high influence Usually not the target of the project Could use their influence to facilitate or derail project. Examples are religious groups, other CBOs etc. They need to be kept informed and their views need to be acknowledged to cultivate support, and to avoid disruption and/or conflict. They loosely fit in the consult to inform type of involvement

31 Categories of stakeholders Category IV: low importance, low influence Unlikely to be closely involved in the project Examples include institutions of higher learning. They require no special participation strategies but need to be informed in a general way of the intervention and its results Falls under the inform type of participation

32 Table of importance and influence Example: Rural livelihoods project Stakeholder Importance Influence Small farmers 5 2 Food traders 1 3 Labourers 5 1 Money lenders 1 4 Government officials 2 5 Key: 1 = very little importance/influence; 5 = very great importance/influence

33 Prioritizing stakeholders

34 The actions to be taken High power, interested people: these are the people you must fully engage and make the greatest efforts to satisfy. High power, less interested people: put enough work in with these people to keep them satisfied, but not so much that they become bored with your message. Low power, interested people: keep these people adequately informed, and talk to them to ensure that no major issues are arising. These people can often be very helpful with the detail of your project. Low power, less interested people: again, monitor these people, but do not bore them with excessive communication.

35 Mapping the stakeholders You can summarize the understanding you have gained on the stakeholder map, so that you can easily see which stakeholders are expected to be blockers or critics, and which stakeholders are likely to be advocates and supporters or your project. A good way of doing this is by color coding: showing advocates and supporters in green, blockers and critics in red, and others who are neutral in orange.

36 Mapping stakeholders Geraldine Diona Johanna Mariecon Julio Aleja Francis Edmapi Odessa

37 Suggested strategies Depending on the stakeholders level of influence vs. their salience on the issue, strategies may be tailored to address their concerns. Maintain or increase power of reform supporters through building coalitions, and providing information and resources Convert opposition into support through negotiations, information and/or coalition building, including offering tradeoffs. Offset or counter powerful and not so powerful opponents

38 Strategy matrix

39 Identifying assumptions and risks about stakeholders The success of a project depends partly on the validity of assumptions made about stakeholders and the risks facing the plan Planners must accurately identify (and assess the importance of) the most likely assumptions about each key stakeholder By assessing influence and importance of stakeholders, some risks will emerge from the matrix from stakeholders whose interests are not in line with plan objectives. The level of risk must be correctly measured.

40 Getting credible commitments For people to commit they must: Be dissatisfied with the current situation Like the way things will be See a straightforward first step Be convinced that benefits > costs Because stakeholders and their positions may change over the course of negotiations and analyses, SA should remain an ongoing process allowing for policy design to adjust as more is known about the political reality.

41 Example: changes in forestry policy Primary stakeholders directly dependent on natural resources Resource owners and/or users Traditional natural resources management institutions Secondary stakeholders not directly dependent on natural resources but have a major interest in the way resources are managed CBOs, NGOs, government departments, the private sector, Religious institutions IFAD

42 Example: changes in forestry policy Key secondary stakeholders those with more responsibility or interest in the potential project or natural resource management and use. Government departments responsible for facilitating natural resource utilization and management Donors funding project development and implementation IFAD

43 Identifying stakeholders Core issue IFAD

44 Stakeholder mapping Environmental NGOs Forest produce users Global Witness + - Local politicians proenvironmental lobby Farm produce users Tourist operators & tourists Forest dwelling communities Farm labourers Resin traders Churches Farmers/ water-users in watershed Women in forest dwelling communities Universities Traditional authorities Forest Policy Reform Rubber/resin tappers Plantation workers Workers in logging companies Plantation owners Forestry Dept. officials Forest Department production section Logging company owners Timber dealers Furniture makers Sawmill workers Timber exporters Local politicians pro-logging lobby Political party financed by logging companies Forest Research Institute IFAD

45 Livelihood analysis of stakeholders For each stakeholder group (and particularly poor stakeholders): how does the policy issue (& potential changes) affect their access to livelihood assets? how does it affect their vulnerability? what relations do they have with the different institutions and organisations concerned? what livelihood stategies do they currently employ and how are they affected by the policy issue (& potential changes)? how will their livelihood outcomes be affected? how can they be engaged in the process of influencing and changing policy? IFAD

46 Stakeholder chart Stakeholder group Nature of interest in policy decision Potential impact of policy Relative importance of interest Importance of group Influence (power) of group 1 stakeholders Women in forest dweller communities Improved food security High High High Low Resin tappers (male) Sustained income High High High Low 2 stakeholders Forestry Department officials 3 stakeholders Environmental NGOs Institutional responsibility + income Protection of forest biodiversity + funding from overseas donors High High High High Medium High Medium Medium Low IFAD

47 Risks and pitfalls in stakeholder analysis Can go wrong No guarantee of success Jargon can be threatening Analysis only as good as information collected garbage in, garbage out Matrices can oversimplify complex situations Judgments often subjective Team work can be damaged if differences between groups, rather than common ground, are over-emphasised

48 Managing change Support Messages 1 Identify Stakeholders Needs Communication Stakeholder Planning Stakeholder Analysis STAKEHOLDER MANAGEMENT Reactions To Change Comprises Rational Emotional 2 Prioritize Stakeholders 3 Understand Stakeholders Stakeholder Analysis Stakeholder Planning Other People s Views

49 Who calls the shots? Who says it starts and it stops? What's what and what's not? Not me, not you Not i. - Rottin Razkals

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