Why Stakeholder Management is so important

Effective Stakeholder Management is crucial to the success of any project or programme. This case study is a prime

example of what can go wrong when stakeholders are not managed and Stakeholder Engagement is not adequately

planned.

In $1999$ the UK passport Agency planned to introduce a new computerised processing system to replace an old system

and provide more secure passports. They aimed to introduce the system in their Liverpool and Newport offices before the

summer busy period. The timeline was tight and the Agency failed to provide enough time for staff to learn and adapt to

the new system. The introduction of the system had to be postponed and the Agency was unable to cope with the

demand for new passports. Failure to adequately assess the time needed to implement the system and lack of a

contingency plan in the event of a problem were compounded by a further failure to adequately manage the Agencies

most important stakeholders $$ the media and the general public.

The timeline was tight and the Agency failed to provide enough time for staff to learn and adapt to the new system. The

introduction of the system had to be postponed and the Agency was unable to cope with the demand for new passports.

Failure to adequately assess the time needed to implement the system and lack of a contingency plan in the event of a

problem were compounded by a further failure to adequately manage the Agencies most important stakeholders $$ the

media and the general public.

On $18$ November $1998$ the Agency, suspended the rollout of the computer system. In February $1999,$ applications began

to increase and processing times rose. By March, the delays started to attract Parliamentary and media attention. The

number of applications then rose steeply.

At this point the Agency should have been able to refer to its Stakeholder Communication Plan and put in measures to

engage with the media and the public. Instead they withdrew some staff from the telephones and moved them to

processing applications. According to the NAO report into the crisis $(27$ October $1999,$ pg $47)$ at peak periods in Liverpool

the telephone service was virtually shut down. At this point the Agency could have increased their channels of

communication to engage with their key stakeholders. Instead they altered their recorded message to advise callers to

write to the Agency and provided a fax number. The number of written queries quickly exceeded the Agency$$s ability to

cope. Without adequate information the feeling of panic increased and applicants were forced to join queues of

thousands outside the passport offices. The Agency responded by buying umbrellas and luncheon vouchers. By August

$1999$ compensation payments to the public totalled approximately $161,000$ and were continuing to rise. The National

Audit Office $($NAO$)$ estimated that the total cost to the Agency would be around $12\mathrm{.}6$ million. This estimate excluded $9$

million in lost business borne by Siemens Business Services $($another of the passport agency's 'key player' stakeholders$).$

When the NAO published their report the Agency were considering measures to cope with demand during busy periods

including: expanding the telephone enquiry service$$ and improving the information it made available to the public through

advertising and via the internet. Sounds like they started to write their Stakeholder Engagement Plan, let$$s hope it got

finished!