26 Project Charter
What is the Project Charter?
A project charter, project definition, or project statement is a statement of the scope, objectives, and participants in a project. It provides a preliminary delineation of roles and responsibilities, outlines the project objectives, identifies the main stakeholders, and defines the authority of the project manager. It serves as a reference of authority for the future of the project.
The charter document can be just a couple pages in length or can be 50-100 pages. Ideally it will be short (less than 5 pages) and written in clear and concise language so that anyone who reads it will have a clear understanding of the project, regardless of their technical background. Most project charters include a place at the end of the document for approval sign off by the project sponsors or customers (i.e. those people that are paying for the project).
Purpose of the Project Charter
The project charter is used by the project manager during the planning process. The project charter informs the project manager about what skills will be required on the project team, as well as the general scope of work for the project. Some organizations forgo creation of a project charter, viewing it as a document that merely takes time to create and contains information that “everyone already knows.” This can be a big mistake. The charter can be referenced by the project manager and stakeholders if some of the goals of the project are not met or they are asked to do something outside the scope of the project. A well-drafted project charter can prevent political interference in achieving the goals of the project and reduce scope creep.
In summary, the purpose of a project charter is to:
- Provide an understanding of the project, the reason it is being conducted, and its justification.
- Establish early on in the project the general scope.
- Establish the project manager and his or her authority level. A note of who will review and approve the project charter must be included.
What Should Be in the Project Charter?
There are many templates available for project charters and these vary greatly in the content and level of detail. (The PMI affiliated web site ProjectManagement.com offers a number of project charter templates) At a minimum, good project charters will contain the following sections.
Background
The background should provide a broad overview of the project and answer the following questions:
- What is the purpose of the project?
- Where did the project originate? Have we conducted similar projects in the past?
- Who is the project manager and what level of authority does the project manager have?
Business Case
The Business Case describes why this project was selected over others and answers the following questions:
- Why was this project selected to move forward (project justification)? What selection criteria where used? (Project selection techniques are covered in a later chapter.)
- What problems is this project solving or what opportunities is it creating? What are the high-level requirements?
Goals
Listing the goals for the project ensures that the stakeholders will not be disappointed when the project is completed. This section should answer the following questions:
- What are the broad goals of this project?
- How will we know if the project is a success (what are our metrics for success)?
- Are there industry standards that we are trying to meet or benchmarks for performance that we want this project to attain?
Key Stakeholders
This section describes the key stakeholders and their interest in the project. This doesn’t have to be an exhaustive list of stakeholders, but should contain a list of people that are interested in the project, as well as people who will pay for, or benefit from, the project.
Major Milestones
This section provides a summary of the major milestones for the project. A listing of any hard deadlines for the project should be included. Milestones can relate to project work (when are major deliverables expected to be complete?) as well as invoicing and payment deadlines.
Project Budget
The project budget section should provide a summary of the budget for the project and information about how it was determined. It answers the following questions:
- What is the initial budget for this project?
- How was that budget developed?
- Are the numbers used for budgeting rough estimates based on top-down estimation techniques, such as analogous or parametric estimating, or are they hard constraints?
- What contingency funds have been allocated?
Project Charter
A project charter, project definition, or project statement is a statement of the scope, objectives, and participants in a project. It provides a preliminary delineation of roles and responsibilities, outlines the project objectives, identifies the main stakeholders, and defines the authority of the project manager. It serves as a reference of authority for the future of the project.
The purpose of a project charter is to:
- Provide an understanding of the project, the reason it is being conducted, and its justification
- Establish early on in the project the general scope
- Establish the project manager and his or her authority level. A note of who will review and approve the project charter must be included.
Example of a Project Charter
List the project name, the date of the current version of the project charter, the sponsor’s name and authority, and the project manager’s name.
Example:
Project Name: Rice University Computer Store Creation
Project Sponsor: Jane Ungam, Facilities Manager
Date: Jan 12, 2010
Revision: 1
Project Manager: Fred Rubens
Overview of the Project
Provide a simple but precise statement of the project.
Example: Rice University is planning to create a store to sell computer supplies.
Objective
State the objectives of the project clearly and ensure they contain a measure of how to assess whether they have been achieved. The statement should be realistic and should follow the SMART protocol:
- Specific (get into the details)
- Measurable (use quantitative language so that you know when you are finished)
- Acceptable (to stakeholders)
- Realistic (given project constraints)
- Time based (deadlines, not durations)
Example: The objective of this project is to implement a campus store that is ready to sell computer supplies such as memory sticks, mouse pads, and cables, when class starts in August 2010, with enough inventory to last through the first two weeks of classes.
Scope
Specify the scope of the project by identifying the domain or range of requirements.
Example: The scope of Rice’s school supplies store project includes the activities listed below:
- Determine what supplies will be sold in the store.
- Establish competitive prices for the computer supplies.
- Source and secure supply vendors.
- Establish marketing, procurement, operations, and any other necessary departments, schools, centres, and institutes.
It is equally important to include in the scope what is not included in the project.
Example: The scope of the project does not include:
- Development of any other school store departments
- Store design or construction
Major Milestones
List all major milestones needed to ensure successful project completion.
Example:
- All vendors selected
- Contracts or orders completed with all vendors
- Supplies delivered to the store
- Pricing determined
Major Deliverables
List and describe the major deliverables that will result from the project.
Example:
- Supplies procured
- Operations, procurement, marketing, and other teams established
- Store supplies stocked and displayed
- Store staffing completed, including work schedules
- Store operations policies, including hours of operation, established
Assumptions
Outline the assumptions made in creating the project. An assumption is a fact you are unsure of but can either confirm at a later time or are simply stating so that the project can proceed as if the statement were true.
Example:
- Only computer supplies will be sold in the store.
- Customers will be the Rice University student body and faculty.
- Rice University students will manage the project and be responsible for ongoing operations.
- A store sponsor from the university faculty or staff will be assigned to mentor students and provide oversight.
- Store hours of operation will be approved by the Rice University students or store sponsor.
- Supplier deliveries will be arranged or the store sponsor will pick them up with students.
- Students will be empowered to contact vendors for order placement and inquiries via telephone.
Constraints
Define any and all constraints on the project or those working on the project. This is an important part of the project charter. A constraint is anything that limits the range of solutions or approaches.
Example:
- Student availability to meet for project planning is limited to school hours.
- Software is not available for project planning and control.
Business Need or Opportunity (Benefits)
Provide a concise statement of the business need or opportunity that led to the creation of the project. Why was it created? What are the benefits? How does the project contribute to organizational objectives?
Example: The goal of this project is to provide income for the Rice Student Centre while supplying necessary items to students and faculty at competitive prices. The school store will be a convenience to students since necessary supplies will be available on campus. This will help students learn to manage their personal supplies.
Preliminary Cost for the Project
Provide a statement indicating how the cost of the project will be defined and controlled.
Example: The procurement team will assemble a proposal based on expected costs for review by the Dean of Undergraduate Studies.
Project Risks
A risk is anything uncertain that may occur that will reduce or decrease the chances of project success.
Example:
- There is a state election coming and the new government may change the taxation rules for private university retail outlets.
- The cloud is changing student demand for media such as flash drives in somewhat unpredictable ways. If this happens faster than we forecast, we may be building a store that students don’t need.
- Deliveries of store shelves, etc. will be delayed if a major hurricane occurs.
Project Charter Acceptance
Provide the names, titles, and signature lines of the individuals who will sign off on the project charter.
Project Stakeholders
Provide the key stakeholders and team members by function, name, and role.
| Function | Name | Role |
|---|---|---|
| Project Manager | Monica Styles | Leads the project |
| Sponsor | Adrienne Watt | Project sponsor |
| etc. |
Image Descriptions
Figure 7.3 image description: A conversation between an office manager and a contractor.
Office manager: Not only did you paint my office walls blue, but you painted the ceiling blue as well.
Contractor: You asked me to paint the room blue, and now you’ve got a blue room.
Office manager: But the ceiling is oppressive! Ceilings should never be the same colour as the walls. They should always be a lighter colour.
Contractor: You asked for a blue room. You’re lucky I didn’t paint the floor blue as well.
| Criteria | Weight | SJS Enterprises | Game Access | DVD Link |
|---|---|---|---|---|
| Educational | 15% | 90 | 0 | 0 |
| Sports-related | 15% | 90 | 90 | 90 |
| Secure payment area with the ability to use Payplay, bank payments, cheques, and school payment systems as a payment source. | 10% | 90 | 50 | 50 |
| Live Support | 15% | 90 | 0 | 0 |
| Search Option | 5% | 50 | 50 | 30 |
| Games available for all platforms currently on the market including school learning systems. | 10% | 60 | 30 | 30 |
| Longer rental periods (1 to 2 weeks) | 5% | 40 | 20 | 40 |
| Sidebar with categories, such as most popular, multiplayer, and just released. | 5% | 50 | 50 | 20 |
| Registered customers must be able to order the videos, track delivery, return videos, and be able to provide reviews of views. | 10% | 50 | 30 | 30 |
| Age/grade appropriate section (can isolate certain games to certain ages or grade levels) | 10% | 70 | 5 | 0 |
| Weighted project scores: | 100% | 75.4 | 31 | 29 |
Text Attributions
This chapter of is a derivative the following texts:
This chapter of Project Management is a derivative of the following works:
- Project Management by Merrie Barron and Andrew Barron. © CC BY (Attribution).
- Essentials of Project Management by Adam Farag is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.
