Six Principles for Win-Win Projects: A Stakeholder Theory Approach

Stakeholder Theory is a widely embraced concept in many fields, and has also been ascendant in the world of project management, with the Project Management Institute in 2024 going so far as to define project success as one in which “key stakeholders” perceive satisfactory outputs relative to the investment of resources.

In practice, forward-thinking project managers frequently incorporate the principles of Stakeholder Theory — specifically the idea that businesses exist to create value for all stakeholders — into project planning and management, taking an inclusive and encompassing view of what it means to successfully complete a project.

In some instances, however, even projects managed with a stakeholder-centric approach can be fraught with tensions, particularly in instances where projects are delayed or costs have ballooned. When hurdles arise, stakeholder engagement and shareholder value-oriented decision-making can appear to be at odds, and an inability to resolve obstacles can create inefficiencies and governance issues — and stoke divisions among stakeholders.

In a new paper, three Darden scholars with unparalleled expertise in stakeholder theory and project management have plotted a new path forward, offering a framework for creating value for all stakeholders while redefining true project success.

“Stakeholder concepts have been used in project management for many years,” said Darden Professor Ed Freeman, widely considered the originator and foremost authority on Stakeholder Theory. “We wanted to bring some of the latest thinking to the field and also learn from the best current research.”

The paper, “A Stakeholder Theory Perspective for Project Management,” written by Freeman, Vice Dean and Senior Associate Dean for the Full-Time MBA and Professor Yael Grushka-Cockayne, and post-doctoral research associate Prem Menghwar, was published in the International Journal of Project Management in October.

The collaboration unfolded with Freeman devising six principles of Stakeholder Theory, which were further illuminated in collaboration with Menghwar, and Grushka-Cockayne integrating the ideas into the world of projects.

“By definition, projects have a finite point to them — there is a deadline, and they typically end when the scope has been accomplished,” said Grushka-Cockayne, whose Project Management MOOC on Coursera has enrolled nearly 400,000 learners. “Stakeholder Theory allows us to think about a project in a larger context, thinking beyond the walls of a specific project and incorporating the longevity of relationships among the stakeholders and the longevity of the project’s outcomes.”

While those practicing project management often operate with multiple stakeholders in mind, the Darden researchers suggest there is ample room to build and explore. 

For example, project managers frequently use a tool called a Power Interest Grid to map stakeholders and ensure they are effectively managed. The emerging research from the trio of Darden scholars suggests that the popular tool falls short, Grushka-Cockayne said, placing stakeholders into a temporary classification that fails to account for long-term implications of many projects.

Considering Projects and Stakeholders with a Wider Focus

Most existing approaches to applying Stakeholder Theory to projects consider many groups through a too-narrow lens, according to Darden experts. Specifically, stakeholders are often classified as internal or external, or powerful or weak — problematic distinctions that can fog the outlook for the project. It is the nature of the problem and project itself that should determine which stakeholders are important, the authors write, with the traditional internal versus external distinction typically of little importance.

Considering projects as temporary endeavors can also obscure a holistic consideration of stakeholders. For example, while a specific working environment may be temporary, the parent organization is not, and while some projects may have a short completion period, their impact on the parent organization and various stakeholders may be long-term. Defining projects as temporary reduces the work to its narrow end goals and fails to account for the long-term interests and relationships involved.

With an eye toward taking a more expansive view, the authors propose six principles for a stakeholder-centric approach to project management. The principles, which seek to support inclusion of multiple stakeholders and their engagement throughout a project’s lifecycle, are:

1. Context Matters: Identifying who or what is a stakeholder through the lifecycle of the project and beyond depends on the context; and the need to engage with different stakeholders may also shift throughout the project. As projects progress, key stakeholders may change, and ongoing engagement with all parties is critical regardless of notions of what interests may be most powerful. Adopting an inclusive and context aware stakeholder engagement approach is essential for ensuring project success and fostering long-term value creation for all stakeholders.

2. Stakeholder Interdependence: A project’s total value creation should be understood as a function of the total value created for all other stakeholders. This idea suggests that any project generates effects on its customers, suppliers, employees, shareholders and communities. Moreover, no stakeholder can maximize their individual value on their own, as all value systems are interconnected. An environment conducive to project success is one in which all stakeholders, including project managers and the broader community, recognize that their interests are interconnected and integrated.

3. Win-Win-Win-Win-Win-Win for Project Stakeholders: Rather than a tool to achieve one particular stakeholder’s ends while using other stakeholders as a means, project managers have the ability to create winning outcomes for all stakeholders. This requires a focused approach and creative attention to all stakeholders, and there is no one-size-fits-all strategy for fulfilling the interest of multiple stakeholders without tradeoffs. Project owners are encouraged to engage proactively with stakeholders to create mutually beneficial outcomes.

4. Creative Imagination: Stakeholder theory emphasizes the importance of relationships among stakeholders and highlights the power of human cooperation in fostering and enhancing creative imagination, an idea defined by the American Psychological Association as “the faculty by which new, uncommon ideas emerge, especially when emergence does not seem explicable by the mere combination of existing ideas.” Project managers can harness this idea by moving beyond a planning and control role to one of relationship management and collaboration, where creative imagination can be effectively harnessed to co-create value for stakeholders. 

5. Intersectionality of Stakeholders’ Interest: A large complex project, including one with many stakeholders with diverse interests, can be broken down into smaller projects with fewer stakeholders. In doing so, intersectionality, or a convergence, of interests may be achievable. Such ideas underpin widely used Agile methodologies, which typically call for smaller project teams with active participation of client representation and the decoupling of tasks.

6. Importance of Normative and Ethical Concepts: The interests of stakeholders are often values-driven, particularly in the case of projects designed and executed to solve social problems. This has important implications given existing research demonstrating that stakeholders develop a relationship with a firm when it accounts for the ethical components of their preferences, and that stakeholders often care less about their own interests but rather place value on a firm’s treatment of other stakeholders. There is no such thing as an ethics-free zone, and a blending of ethics and norms would likely foster superior results.

In detailing the six principles, the Darden scholars are suggesting a new phase and hope to seed the field for future areas of exploration and study at the intersection of project management and Stakeholder Theory. They suggest additional empirical research on the principles can deepen the understanding of how project managers can apply the principles in practice to achieve common goals. And, despite the ample room for additional study, the six principles are ready to be used now by creative, results-oriented project managers.

“We believe adopting these principles can guide project managers in creating win-win-win-win-win situations for project stakeholders and lead to harmonizing the interests of multiple stakeholders,” said Menghwar.

This article is based on the paper “A Stakeholder Theory Perspective for Project Management,” by R. Edward Freeman, Yael Grushka-Cockayne and Prem Menghwar, published in the International Journal of Project Management (October 2025).