Creating a Project Charter
One of the first steps in most projects is to develop the project charter. Project charters include high-level information regarding the project’s outcomes and every step along the way. Creating the project charter is the first part of the project integration management process.
In order to approve a project, a charter must be produced and deemed complete by key stakeholders.
When Should I Start Creating This Document?
Develop project charter:
- The first part of integration management
- Authorizes the existence of a project and provides the authority to the project manager
- The output of the process: project charter
The project charter authorizes the project in a company, giving authority to the project manager who created it. Once the project initiation is decided, the sponsor will start the creation process. The project manager is assigned to a project as soon as the charter is completed. Then, the authorization process is complete, and the organization will allow the project manager to coordinate project duties.
The final outcome of this process results in the project charter. The primary purpose of this document is to collect important information about the project while making it viewable in an easy-to-read, high-level way.
What Goes Into a Project Charter? With Real Life Examples
In this example, we will use the Bourne Bridge construction in Cape Cod, Massachusetts. Using this as our reference, let’s discuss what goes into a project charter.
Project Title and Description
When beginning the project charter process, starting with the project title and accurate description is vital. These two attributes should give a brief introduction to the purpose of the project. Bourne Bridge construction will be the title of this project.
For the description, we will write that vacationers have traveled to Cape Cod in massive numbers; thus, transportation needs have increased dramatically. Transportation by boat will not be an adequate solution, as this will not be time-efficient. Travelers must be able to drive from the mainland to the island quickly.
Project Managers Authority
For the Bourne Bridge Project, Kate Richards has been assigned the role of project manager. Kate Richards will be the project manager and therefore is responsible for determining the budget, choosing team members, and approving all change requests related to the project. Keep in mind that there might be a few different responsibilities associated with the title of project manager. At this stage, only high-level information must be shared.
Creating a Business Case
The initiation of the project must always be written on the project charter. The business case will explain the core purpose of the project and what triggered the start of the assignment.
For instance, the Bourne Bridge Project must be completed to solve the summer travel issue. Once the project is completed, 60% of vehicle transportation will be conducted over the bridge. This will significantly help the transportation problem as all of this information will be included in the business case, and there might be several editions for each stage of the project.
All the resources needed to complete a project are planned for during the planning phase. It is essential to consider all resources that will be needed from the start date to the final execution date of the project. Resource estimation should be included in the project charter, along with resources already assigned to the project.
Stakeholders are an essential part of any project, and they can significantly impact the outcomes of an assignment, as they have a significant stake in the project itself. All expectations must be appropriately managed throughout the project, as this is the project manager’s responsibility. Outspoken stakeholders must be closely watched, as stakeholder lists are updated according to the project management strategy.
For example, in the case of a bridge construction project, stakeholders might be calling:
- Government officials. Since this project will impact the tourist population of the island, the overall economy might be impacted. Therefore, the government needs to be involved in this critical decision.
- Residents must also be notified. There will be significant construction around the bridge, which will cause some problematic traffic patterns for locals. It is important to advertise this positively and reassure locals that their properties will rise in value since they will have easier access.
- The project team is another stakeholder in every project. They’re the ones to carry out all project activities; therefore, they must be heavily involved with the success of every outcome.
All stakeholder requirements must be documented in the project charter. Remember, there might be some conflicting requirements when it comes to the duties of individual stakeholders. If this occurs, all disputes may be resolved, and requirements can be taken into account. For example, when stakeholders might require toll booths to enter the bridge, while another stakeholder asks for E-ZPass access. While these two requirements can be implemented simultaneously, they must still be discussed and documented in the project charter.
Examples of stakeholder requirements include:
- The bridge must have bike paths and walking paths
- The bridge must be able to carry 3 million kg
- The bridge must have six total Lanes
Product Description and Deliverables
The product description must also be listed, along with the deliverables. For example, the final constructed bridge will be the project’s outcome.
Some examples specifications of this project might include:
- Bridge height of 300 M
- Bridge width of 30 M
- Three legs of the bridge must be completed in the first year.
Measurable Project Objectives
All measurable project objectives must be outlined in the project charter. Project objectives will help the team understand what is expected of them at each stage of the assignment.
Some examples of measurable project objectives may include:
- Finishing the project in four years
- Checking to a budget of 20 million dollars
Project Approval Requirements
All project approval requirements must also be listed in the project charter, as it is imperative to note which items are needed so that they can be approved. All resources must be signed off in the Project Charter for them to be ordered and used.
High-Level Risks of the Project
Every project has risks. This does not mean that you should not embark on the assignment! There can be both positive and negative risks, which offer opportunities for the project to exceed expectations.
For example, the Bourne Bridge will connect two sides of Massachusetts, which will help to facilitate tourist traffic flow. This is an opportunity for the economy to grow while also allowing travelers an easier commute to and from the island.
Project Sponsor Authorizing The Project
Remember, there might be several sponsors involved in a project. For example, the Bourne Bridge project might have stakeholders such as:
- The governor of Massachusetts
- Town officials on Cape Cod
What Are The Benefits of the Project Charter?
It’s no secret that there are incredible benefits to creating a project charter. Project charters include everything that is needed for the construction of a project to begin. Let’s take a deeper dive into the specific benefits of creating this document:
Benefits of creating a project charter:
- Without a project charter, project managers cannot be successful
- The project managers may prepare project charter, but a sponsor must publish them
- Project charters are broad enough so that there is no need to change them during project execution
If your team doesn’t create a project charter, the project manager cannot be successful. The project charter will define what is needed for a successful project. This document will include the business case, names of significant stakeholders, expectations, potential risks, and more. Information is power!
Project managers can prepare project charters. However, they must be published by the project sponsor. Since project managers are assigned to projects early, they might prepare ahead of time. However, the project charter needs to be approved by a project sponsor. This is because project sponsors hold true accountability for the outcome of every project.
Project charters recognized the authenticity of a project. They include high-level information about what needs to be completed so the entire organization can be on board. Project charters give managers the autonomy to spend money within budget and decide on required resources. Once the charter is approved, it is deemed official by the organization. Project managers can use the budget and resources allocated once the charter is approved.
High-level requirements of the assignment are detailed in the project charter. This document will serve as a source of truth for detailing what is necessary to achieve success.
Last but not least, the project charter helps facilitate the communication of ongoing work to the organization. There might be several projects happening all at once in an organization, which is another reason why project charters are so crucial. These documents are an essential link between what is currently occurring at the company and the desired outcome.