Managing Stakeholders Through Understanding Human Psychology

Better handle your relationships with stakeholders with the S.C.A.R.F. model

By: Cindy Brummer, CEO & Creative Director at Standard Beagle Studio

Think back to the last time you worked with or had to present to a stakeholder in your work as a product manager? Was it positive or negative? Hopefully, it was a great experience. But there’s also a good chance you walked away feeling confused, bewildered, or even frustrated.

Working with stakeholders can be tough. Sometimes it can be difficult to manage these relationships. This is true if they are part of your company or clients. But what’s also true is that working well with stakeholders is critical to the success of a project. How can we make sure we manage the relationship so our projects go well?

A stakeholder is defined as anyone who has an interest in the product. These folks can either have an influence on the decisions that go into a product or they can be affected by product outcomes. Product managers often talk with multiple stakeholders a day. If you do a Google search, many articles about stakeholder management recommend a three step process for product managers to manage stakeholders:

1. Identify the stakeholders
2. Understand stakeholder goals and pain points
3. Prioritize stakeholders by evaluating and classifying them according to their interest in the product and their power

This is a very logical process. The only problem with it is when you don’t fully understand what’s going on in a stakeholder’s world. Unless you undertake some serious research, it can be tough to accurately know a person’s interest and power. It takes some guessing. And even if you have an understanding of a stakeholder, things can still go wrong.

A personal story:
This happened to me on a project with a large technology company. I was working as an outside vendor helping to guide the initial research so the company could better understand priorities for platform improvements. There were more than five stakeholders involved. 

One of those stakeholders was “Fred.” Fred was one of the initial champions of the project. They were new in their role and new to the company. I had identified them as a key influencer and highly important to the project. It was important to stay on their good side.

The project started off well. Meetings were productive and Fred was open to the process and positive about how the project progressed. However, about halfway through the project, Fred’s attitude started to change. Here’s how:

• Fred started to stay off camera during our meetings and said little
• Fred started to micromanage aspects of the project, like who was contacted for research and how
• Fred strongly questioned findings and asked questions that felt overly critical
• Fred gave no feedback at all at the conclusion of the project

Something had clearly gone wrong, even though I was aware that Fred was a crucial stakeholder and understood their pains and goals for the project.

Managing stakeholders is about dealing with people, and people are more than their jobs. There might have been issues I didn’t look for in that initial interest/power review: internal politics, a situation at home, or an interpersonal disconnect.

It’s risky when stakeholders lack buy-in or become critical of a project and its outcomes. Not only can tough stakeholders poison a project, they can also make it really difficult for product managers to enjoy their work. At best, productivity decreases or the project slows. At worst, the entire project is abandoned, meaning lost time and resources.

Ultimately, my project ended well, but I doubt I will ever be asked to work with them again. And it was no fun working with a stakeholder that obviously was unhappy. Might I have been able to manage Fred and improve the situation had I had more information?

Understanding human needs

Fortunately, the answer is yes. But we need to understand how the human brain works. In his book “You Brain at Work: Strategies for Overcoming Distraction, Regaining Focus, and Working Smarter All Day Long,” Dr. David Rock describes the five things every human needs:

• Status
• Certainty
• Autonomy
• Relatedness
• Fairness

He calls this the S.C.A.R.F. model. Every human brain constantly evaluates situations based on these five needs. Our brains react negatively when we feel one or more of these needs are threatened and positively when these needs are satisfied.

Status

Humans judge their status against the status of those we interact with. Social status is a primary threat or reward for our brains. We feel great when we feel our status is protected or enhanced. But when we feel our status is threatened, we react negatively. And sometimes we don’t even realize this is happening. For example, when we feel rejected or excluded, this activates the same regions in our brain as physical pain.

Certainty

Humans crave certainty over chance. This has been backed up by numerous studies, including psychologists Daniel Kahneman and Amos Tversky who published findings in 1979 about their Prospect Theory. They found that people avoid risk when there is a possibility of a sure gain. So when we feel uncertain about the future, our brains react negatively. We feel strong emotions rather than rational thought, and it can take some time to calm that reaction.

Autonomy

When we feel control over our lives or work, we feel more positive. But when we feel micromanaged or a lack of control, our brains feel threatened.

Relatedness

People feel a sense of relatedness when they feel part of a cohesive team. And this generates a reward in our brains. But our brains feel threatened when we feel disconnected or that we do not relate to the team.

Fairness

When a person feels they are being treated fairly or that a situation is just, they feel calmer and at ease. However, when someone feels there is unfairness, it actually activates the part of our brain that feels disgust.

When it comes to stakeholders, I’ve found that status, certainty, and relatedness are most applicable; although, all of these have a role in our interpersonal relationships. If I look back at Fred the Stakeholder, now I can understand why the project was strained.

The S.C.A.R.F. model in action

When a person feels they are being treated fairly or that a situation is just, they feel calmer and at ease. However, when someone feels there is unfairness, it actually activates the part of our brain that feels disgust.

When it comes to stakeholders, I’ve found that status, certainty, and relatedness are most applicable; although, all of these have a role in our interpersonal relationships. If I look back at Fred the Stakeholder, now I can understand why the project was strained.

STAKEHOLDER STATUS

Fred thought I was a threat to his status. Somehow I made him feel like he was “less than.” It may have been how I presented the material or how I didn’t defer to him on calls.

WHAT TO BE AWARE TO OF

• Status is relative. It highly depends on the people around. 
• Reward from increased status can come anytime you feel “better than” someone else
• Corporate politics includes the “pecking order” of individuals.

WHAT COULD I HAVE DONE DIFFERENTLY

If I had noticed that Fred’s was reacting to a change in status, I could have taken steps to help the situation. But I could have also taken these steps to ensure that he never felt bad.

• Give strokes
  A stroke is a small, genuine compliment in response to something a person said or did. This is not gushing praise or disingenuous. It’s something as small as saying “I appreciate you saying that” or “Thank you for the question.”
• Tell a third-party story
  Sometimes we feel our status is threatened when it feels like we’re being lectured or talked down to. A way to help this is to share stories about other situations that are similar. These third-party stories are true, and can help you suggest steps without directly threatening the stakeholder’s status.
• Get uncomfortable…intentionally
  Believe it or not, people feel better about themselves when other people are worse off than they are. Always being polished and put together and never making mistakes can threaten status. One way to address this is by finding something small to show you’re human. It could be that you lost your pen, or maybe that you stumbled a little on your words. No need to embarrass yourself. Just find something small that makes you seem more approachable.

STAKEHOLDER CERTAINTY

Fred thought he knew what the project would end up finding. But I followed the research, and it wasn’t what they thought. This threatened his certainty.

WHAT TO BE AWARE OF

Remember that humans crave certainty and clarity. Ambiguity is extremely uncomfortable. Product development — especially agile product development — can be very ambiguous because of changing requirements or needs.

WHAT COULD I HAVE DONE DIFFERENTLY?

One of my favorite tools for team building with strangers is the vision meeting. The vision meeting is done near the beginning of a project, and seeks input from key stakeholders on the direction of the project. 

Conducted with sticky notes and markers, you ask key questions of stakeholders to brainstorm ideas. Then the stakeholders sort the ideas and prioritize.

When I’ve facilitated these meetings, it helped me build rapport with the team as well as encouraged stakeholders to connect and align over the project. They feel involved.

CONCLUSION

It’s tough to know whether or not I could have fixed my experience with Fred the Stakeholder by understanding human psychology. But I do know that being aware of these concepts has helped me navigate later stakeholder interactions more effectively.

We’re all human. We all crave the rewards of status, certainty, autonomy, relatedness and fairness. When we are aware of how others may feel, it can help improve stakeholder relationships, ultimately leading to better project outcomes.