Creating the Project Charter - Project Management

We've covered a lot of information before getting to the project charter. The project's been proposed, outlined at a very high level, passed through a selection committee, and finally approved. You know who the sponsor is and by now are likely to know the primary stakeholders and have an idea of their role in the project. As you get further into the project Planning phase, more stake-holders may come to light whom you'll want to add to your stakeholder list. Now it's time to produce the project charter.

The project charter is an official, written document that acknowledges and recognizes that a project exists. It's usually published by the project sponsor but can also be published by another upper-level manager. It's important that the charter be published by a senior-level manager since it gives more weight and authority to the document and it demonstrates management's commitment and support for the project.

project charter

The official project kickoff document. It gives the project manager the authority toproceed with the project and commits resources to the project.
The charter contains several pieces of information about the project that are more in-depth than the project concept document but not as detailed as those found in the scope statement. As you can see, we've started at the 50,000-foot view with the project concept document, and now we're closing in a little tighter with the project charter by refining some of those elements even further. By the time we get to the scope statement, we'll know all the precise requirements of the project and what elements will be used to determine whether the project is successful at completion.

Before we get into the particulars of what goes into the charter, let's take a look at some of the purposes for the project charter.

Purposes for the Charter

The primary purpose of the project charter is twofold: It acknowledges that the project should begin and it assigns the project manager. Let's look a little closer at all the project charter purposes.

Acknowledges that the project should begin:The charter announces to all the stakeholders that the project has received approval and been endorsed by upper management. It serves as official notification to the functional business units that their cooperation is needed and expected.

Commits resources to the project: The project charter commits the organization's resources to the work of the project. This includes time, materials, money, and human resources.

Ensures that everyone is on the same page: This may seem obvious, but you'd be surprised by how many projects get started without a project charter and very few requirements. Perhaps half of the stakeholders think the purpose of the project is to upgrade the network, and the other half think the purpose of the project is to move the servers in the computer room to a new location. That might be a stretch, but you see the point. When the purpose, objectives, and an overview of the project are written down and agreed upon, everyone understands the purpose from the beginning and confusion is eliminated.

Appoints the project manager: In many cases, the project manager is known prior to the creation and publication of the project charter. However, the project charter serves as the official notification and appointment of the project manager. The project sponsor formally assigns authority and responsibility for the project to you, the project manager. This means that stakeholders are put on notice that you'll soon be requesting resources from their areas. Also, stakeholders and team members alike know that you're calling the shots on project issues. Does this mean that you're automatically a born leader and everyone is going to do what you say? No, just because you have the authority doesn't mean that people will respect (or respond to) that authority.

Provides an overview of the project and its goals: The project charter is the first detailed stab at describing the project purpose, overview, goals, and high-level deliverables. While the concept document covered some of these things in a high-level fashion, the project charter goes into more detail.

All this points us back to good communication skills. A well-documented project charter keeps the team on track and helps maintain the focus on the purpose of the project. It helps keep the requirements definition, created in the Planning process, in line with the goals of the project.

Note:You may be asked to write the project charter document, but it should be published under the name of the project sponsor or other executive manager.

Even though I stated earlier that the project charter is published by the project sponsor, don't be surprised if you're asked to actually write the charter contents. If you are asked to write the charter, be certain that you put the project sponsor's name on the document. Remember that the purpose for this document is to acknowledge the project, commit resources, and assign you as project manager. This needs to come from an executive who has the authority to direct people's work. You don't have that authority until the project sponsor appoints you.

In the case of the charter, you'll be exercising those written communication skills. In an upcoming section, you'll find a project charter template. While the template will provide you with the elements that should be included in the charter, you'll need to make certain the content within each area is clear and concise and easily understood by the recipients.

Essential Elements of a Project Charter

In order to write a good project charter, you or the sponsor will need a couple of other documents at your disposal: the product description and the organization's strategic plan. Let's look at each.

Product descriptionThe product description, as you might suspect, is a document that describes the product of the project. The details and characteristics of the product or service of the project are contained in this document. This is not necessarily an official project document, but you certainly should put a copy in your project notebook. The product description is usually completed at roughly the same time as the project concept document but before the project charter. It will begin to give you clues to some of the objectives of the project.

product description

Lists the characteristics of the product including specifications, measurements, or other details that identify the product.

A product description should be clear and concise. If your project consists of manufacturing cases for personal handheld computers, for example, the product description would contain specific information as to size, color, materials, and other exact specifications that describe the product.

Strategic plan The strategic plan contains important information about the overall direction of the company. The project manager should consider this information in light of the project goals. For example, if the organization's strategic plan includes opening offices in three European cities within the next year, and your project includes upgrading the company's network, you'll want to consider the impact the three new offices have on your plan.

strategic plan

Describes the organization's long-term goals and plans.

The project charter has some elements that are similar to the project concept document, but the charter should contain more details. All project documents should have a General Information section that contains the project name, number, date, and perhaps fields for the date the document was modified or a version number, and the author. The remaining sections of the charter should include the following:

Project overview: The overview includes the purpose of the project (which was documented in the project concept document) and also explains the reason for undertaking the project. It should also describe the product or service of the project and reference the product description. Attach a copy of the product description to the project charter or let others know where they can get a copy if they'd like one.

Project objectives: Project objectives should include the factors that help determine whether the project is a success. For example, you've been charged with implementing a new imaging system in the processing area of your company. Your objectives for this project might read something like this: "Implement a new imaging system that integrates with our existing information technology systems and programs. Implement the new system without interrupting current processing work flows." We'll get into specific requirements and deliverables when we produce the Scope statement.

Business justification: It's a good idea to reiterate the business justification for the project in the project charter. The concept document isn't officially signed off by key stakeholders, whereas the project charter is (we'll cover the importance of this shortly), so copy the information in the business justification section of the concept document to the charter. Remember that this section describes the problem or issue the project will solve. This includes describing the benefits to the organization of taking on the project and the impacts to the organization if it doesn't.

Resource and cost estimates: If you have initial cost estimates, include them in this section. This section might include the cost of the feasibility study if one was conducted and the costs of the proposed alternatives. We'll establish a project budget and a resource management plan later in the Planning process that will go into detail regarding costs.

Roles and responsibilities: Include a roles and responsibility chart like the one created in previous table, with the names of the participants under each title. Remember that you'll have only one project manager and one project sponsor, but there might be multiple entries for functional managers, vendors, customers, etc. This is the section that officially gives you the authority to begin the project and secure the resources needed for the project.

Sign-off: This section is very important. Include room for signatures from the project sponsor, key stakeholders, senior management, customers, and anyone else appropriate for this project.

Attachments Attach any other documentation that will help clarify the project, including the product description and the feasibility study.

Some Specifics on the Project Sign-Off

The project charter is not complete until it's signed off. Essential signatures include the project sponsor, the project manager, key stakeholders, senior managers, and the customer. Other signatures can be added as well. Confer with the project sponsor regarding who should sign the document if you're unsure.

Sign-off is important because it assures you that everyone who signs has read the charter and understands the purpose of the project and its primary objectives. Their signatures indicate that they agree with the project and endorse it. It also should mean that you can expect their cooperation on the project and participation in key areas when the time comes.

Tip:The project charter is not official until it's signed by the project sponsor and key stake-holders. This assures that they've acknowledged the project, and it will help assure their cooperation with project activities.

After obtaining all the signatures, your next step is to deliver a copy of the charter to everyone who signed it. At this time, I would also give copies to the remaining stakeholders (the ones who didn't sign the charter) for review. After delivery of the copies, the fun begins with the project kickoff meeting. First though, let's take a look at a project charter template that you can use for your next project. Modify this to suit your organization's needs and personal style. Oh, don't forget, a copy of the project charter goes into the project notebook as well. If you're also keeping documentation on the intranet for others to see, you should put a copy of the charter there as well.

Sample Project Charter

Let's pull all this together into a template format and see what a project charter might look like. As I mentioned, feel free to modify this to suit your needs. You might want to add your company logo at the top and use some color or shading. The example shown here is pretty bare bones just to give you an idea of what information you're gathering and reporting. Get those creative juices flowing and pretty this up a bit for your use.

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