Project Charter is the documented version of how a project is going to go about including its end goals. It is an indispensable component of project planning. Apart from the execution procedures, this document also mentions the stakeholders. This formal document is precise and informative at the same time. Everything from budget to project participants are stated in the project charter. The three vital elements of a charter are namely, project responsibilities, scope, and objectives.
What Is A Project Charter As Per PMBOK?
As defined by the third edition of the PMBOK Guide, a project charter is the formal authorization of a project. Furnished by the project’s sponsor or initiator, this document empowers a project manager to implement organizational resources in the project’s operations.
Contents Of A Project Charter
A typical project charter must contain information on the following:
- Reasons for executing that particular project
- Assumed limitations of the project.
- End goals that also include business requirements
- Budget overview
- Identified risks
- Main stakeholders involved in the project
- Project benefits
- The business case along with calculated ROI
- Initial timeline of the project
- Success criteria
- Target audience
Even PMP Certification holders use Project Charter while starting a new project with the aforementioned pointers. However, a couple of them can be excluded as per project requirements. This does not diminish the need for charter preparation in such projects. No particular format is prescribed by PMBOK for formulating a project charter but it must have all or some of the information discussed above.
How To Recognize A PMBOK Project Charter Irrespective Of Its Format?
Project initiators may stick to their individual presentations of the project charter as per PMBOK to ensure they fulfill the following criteria:
- A project’s existence must be agreed upon by the project’s sponsor/initiator.
- Project initiator must accept the selected project manager’s leadership and authorization.
- Authority is bestowed on a project manager in terms of human and capital resource utilization.
Who Writes A Project Charter?
For committee-sponsored projects, a project charter is written by any one of the committee members or the project manager. Project sponsors being senior executives can hardly devote time to writing project charters. They shift this responsibility to project managers who draft the final copies for them to authorize. This is the reason why PMP aspirants must be knowledgeable in the project charter domain.
Essential Tips To Create An Effective Project Charter
The phase before resource allocation in a project life cycle is the appropriate time to develop the project charter process. It is required for attaining stakeholders’ approval every time a change has to be introduced to improve the respective function/stage of a project. A project manager cannot do that without getting it acknowledged by the other team members and stakeholders.
Naming the project
The foremost step in preparing a project charter is to offer it a name that clearly specifies its end goals, and makes it identifiable. Names with common phrases shared by different project charters only lead to confusion.
Proper presentation
What’s a project charter and what is its purpose need to be made visible through proper presentation of the project’s business case. This includes an explanation of:
- The proposition of the project
- Pain points that would be mitigated by it
- Results to be achieved through the project
- The project’s alignment with organizational goals
- Project execution methods
Budget inclusion
A project charter is incomplete without a mention of the budget. The source of project finance and the estimated expenditure must be stated in this document. It should also include the list of additional resources deemed necessary for project execution.
Performance metrics
The outputs anticipated from a project have to be included within the project charter. This document is flexible enough to include details regarding the measurement of the project’s success rate. The metrics selected for goal accomplishment at different stages of a project need a mention, as well.
Risk mitigation
Stating the predictable project risks and setbacks in the project charter proves efficacious. This documented version facilitates risk management with ease throughout the period of execution by acting as a visible reminder.
Provide time frame
Apart from the expected dates of a project’s initiation and completion, the project charter should exhibit the timeline. The time span allotted to different stages of the project has to be provided in this document.
Stakeholder analysis
Despite being an internal document, a project charter mustn’t be devoid of a well-etched stakeholder analysis. It is done by listing the names of stakeholders. This would keep the project team members aware of the people to be affected by their improper functioning, in case.
Team responsibilities
A project charter is the written version of the project planning that goes within the mind. Task allocation forms the crux of it and must be conveyed well through the project charter in an organized form.
Even if a project charter is only a text wall, it would be read by the stakeholders if not more than once. To catch their attention, it can be made visually attractive to highlight the concerning project’s significance.
