When undergoing a change process, it is important for managers to examine how those affected by the change will react to it. Those affected by the change can include any stakeholder in an organization's actions or policies, including owners, employees, customers, investors, the government, regulators, and community members. Research by John Kotter and James Heskett has shown that high-performing organizations tend to carefully consider the interests of major stakeholders as they make large decisions.

Stakeholder Analysis

When an organization is undergoing a change in its structure, products, or processes, it must carefully consider the impact on all stakeholders involved. Stakeholder analysis involves the systematic collection and analysis of information to determine whose interests should be taken into account when managing a change effort (e.g., developing and/or implementing a policy or program). A stakeholder analysis also allows an organization to anticipate the consequences of any change it institutes and to gain the cooperation of stakeholders.
The process for conducting a stakeholder analysis generally involves the following steps:

1. Plan the process: Define the purpose of the analysis and determine how the results will be used. 2. Select and define a policy: The analysis should focus on a specific policy or issue. 3. Identify all stakeholders. 4. Identify stakeholder interests and needs. 5. Collect and record stakeholder information. 6. Classify stakeholders (by completing a stakeholder table or stakeholder mapping). 7. Analyze the information by identifying areas of conflict and prioritizing stakeholders. 8. Align stakeholder needs with organizational strategies and actions.

Other approaches to stakeholder analysis focus on how stakeholders are classified. These alternative approaches include the Participation Matrix, the Impact/Priority Matrix, the Power and Interest Matrix, the Readiness/Power Matrix, the Problems/Interests/Linkages Matrix, and the Supportive/Antagonistic/Constructive/Deconstructive Matrix.

The Participation Matrix is a tool used to indicate what type of participation each stakeholder has in a particular process or set of activities. For example, some stakeholders may only be informed about certain processes, while some may have a great deal of control over the process. The Impact/Priority Matrix is used to analyze the interests, potential impacts, and priority of importance various stakeholders have in a given process. The Power and Interest Matrix offers a way to compare how much power a given stakeholder has in an activity with how much interest in that particular activity the stakeholder has.

The Readiness/Power Matrix assesses power as well, but it looks at how prepared stakeholders are to enter into a particular endeavor. The Problems/Interests/Linkages Matrix examines linkages or connections between stakeholders, as well as problems and interests they may have with a project. The Supportive/Antagonistic/Constructive/Deconstructive Matrix is a tool for placing stakeholders on either a more positive (supportive/constructive) or negative (antagonistic/deconstructive) side of a chart, and then deciding where on the chart to move them, as well as how to do so.

Politics of Success

One reason it is important for managers to learn how to manage their relationships with stakeholders is that stakeholders often control resources that companies need. The interdependent relationships between companies and stakeholders can be characterized as political, since different players are involved who hold varying degrees of power. Business leaders must identify who controls the resources they need to be successful and help ensure the success of those stakeholders so that that the leaders in turn will be successful. Management consultant Peter Block introduced the term positive politics to refer to a way in which the often-conflicting power