Lessons in Bad Stakeholder Management

Posted on: September 4th, 2015 by Jim

Stakeholders can make or break your project so it’s crucial to involve them early, understand their needs, buy them into the project and set expectations. The project management literature is riddled with examples of poor stakeholder management. (See, e.g.,  Denver International Airport.) But it has recently occurred to me that one of the most egregious examples of this happened in my own backyard with the now-aborted Boston Olympic endeavor.

A little history is in order here:  In a nutshell, the US Olympic Committee (USOC) chose Boston to present to the International Committee as its candidate for the 2024 Summer Olympics. Their timing could hardly have been worse. The USOC chose Boston smack-dab in the middle of the worst winter in Massachusetts history. (More on that later).  According to the Boston Globe, a “nonprofit group of business and cultural leaders called the Boston 2024 Partnership” were the liaison to the USOC.

First problem? In the same sentence the Globe noted that the Partnership had not shared its bid. So now a bid had been made on this project under the usual business cloak of secrecy. The problem in this case is that the Partnership members – at that time largely unknown – were not the only stakeholders. In this case the people of the City of Boston (at least) were. And to put in a bid for a city whose “Big Dig” project was initially estimated at $2.8B but which the Boston Globe estimates will eventually cost $22B is placing one’s head squarely into the lion’s cage. Especially when everyone who isn’t living in a cave knows that Olympics tend to go over budget, sometimes just as wildly over budget as the Big Dig. Because after the circus leaves town, it often leaves behind stadia that serve no useful purpose other than as lonely, sad artifacts. (According to an article in National Geographic, Olympic Games: Legacy or Money Pit,  “paint is peeling on Beijing’s $423 million Bird’s Nest stadium, now a mediocre tourist attraction with an annual upkeep of $11 million.”

As the weeks went by, it was discovered that the local committee had proposed using a little-known area called Widett Circle (near Route 93) as an Olympic Stadium. No problem. Except for one little thing. No one told the seafood distributors and meat packers (stakeholders!) who already work there that this was being considered. “Don’t worry about it,” they were effectively advised. “We’ll move you – somewhere – perhaps to the pier. Let’s just get this thing done and we’ll worry about all those pesky details later.”

Oh, and that snowstorm issue? Well the ‘T’ – the local subway – wound up getting shut down for periods of time as did the commuter rail. And local residents were advised not to worry; that this ancient, creaky, chronically underfunded commuter system could easily handle the millions of visitors (and athletes) that would visit Boston.

The endgame of all this was depressingly predictable. In July of 2015 – barely six months later – the mayor of Boston refused to sign a “host city contract” that would pay for any cost overruns!

So is the moral of this story that the Olympics would have happened if the stakeholders had been bought in? No. I think that in this case the moral is that it would not have taken six months to realize this was a bad idea if stakeholders had been involved early on. It would have been quickly realized that Boston neither wanted nor could financially support the Olympics and the USOC could have gone with “Plan B” – Los Angeles – much sooner.  But – to use another PM term – the lesson learned here (I hope) for the business and cultural leaders is that you cannot assume that by keeping stakeholders in the dark they will, like so many sheep, magically fall in line. Stakeholders – once burned – will come back at you twice as hard. And in Boston we are always ready to throw tea into the harbor at any given time.


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