Why Stakeholder Profiling is Important in Business Analysis

 

An American Author named Robert Greene stated that it is good to always know who you’re dealing with as per 48 Laws of Power. You should never assume that different people will react in the same way to your strategy or plans. It is important to gather as much information as possible about a person who either supports or contradicts your beliefs when you are dealing with them.

Profiling is a crucial aspect while managing relations with stakeholders. Especially in the financial industry, banks are encouraged and even mandated to know who their customers are (KYC). Business Analysts should know about their stakeholders, and what they’re dealing with at every point in time. They should not assume that they already have a complete understanding of stakeholders. Profiling becomes even more important while dealing with stakeholders from different parts of the world being an analyst.

Identifying stakeholders is one thing; profiling them is a different thing altogether. Profiling stakeholders involve an appraisal of their characteristics, behaviours, and attitudes.

There are two aspects to profiling: One is Demographics and other is Psychographics.

Demographics: It is related to understanding your stakeholders by considering their gender, age, marital status, location, nationality, education level, etc.

Psychographics: This involves relating why your stakeholders act the way they do by considering their interests, values, attitudes, lifestyle, aspirations and other psychological criteria. 

For instance, your profiling might reveal that your stakeholders are 

  • Price-sensitive 
  • Do not spend large amounts of money on software solutions 
  • They are technology laggards who are slow to adopt technology. 

Having such prior knowledge is key to prepare a pitch that will help sell recommendations to the business.

So, why is stakeholder profiling important?

Stakeholder Profiling:

  • Can help the analyst in making crucial decisions on how to sell business change to the organization and how to convey the features and advantages of recommendations
  • Can help the analyst understand stakeholder needs, requirements, priorities, and their relative influence over the project.
  • Can provide critical information about each stakeholder which will help the analyst develop a strategy for system acceptance. For instance, profiling can reveal stakeholder needs, problems, and concerns which may be further refined into requirements.
  • Stakeholder profiling can help the analyst identify gaps in their knowledge of understanding stakeholders which would lead them to acquire the necessary information.

If you have a clear understanding of stakeholders it will help to promote the delivery of more acceptable solutions.

So what are the recommended tips for preparing a stakeholder profile?

  1. Don’t be in a hurry during profiling phase – the information you encounter may become extremely important to the success of your project
  2. Keep updated the stakeholder profile information. The document should capture the live updates and evolving needs of stakeholders.

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