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What is the project charter and how is it prepared?

What is the project charter and how is it prepared? Project Charter is the expression of the scope, goals, and people who participate in a project. The project charter begins the process of defining the roles and responsibilities of the project participants and specifies the project objectives. The charter also defines the main stakeholders and the authority of the project manager.

In this guide, we will discuss the method of writing and implementing the project charter.

Main points in the project charter

The project charter serves as a reference document and should define these three main points.

  • What is the project extract? What are the goals of the project? How are you going to achieve these goals?
  • Why does this project exist? Provide a shared understanding of the project. This charter should communicate its value or reason for existence to everyone involved, from the team to the project manager, stakeholders, sponsors, etc.
  • Can we agree on this project? This charter serves as a contract between the project sponsor, key stakeholders, and the project team. By stating the responsibilities of each party involved in the project, everyone will know what their duties are.
What is the charter document?

Although the project statement does not need to be very detailed, there is more to it than these general statements. The project definition should be short as it refers to more detailed documents including the request for proposal.

What is the charter document
What is the charter document

An essential part of any project statement is establishing the authority assigned to the project manager. Other objectives of the document are as follows.

  • What are the reasons for doing the project? Write them down here so everyone knows why they’re doing what they’re doing.
  • What are the goals and limitations of the project? This is the part where you mention why you are doing the project. If you don’t have a clear goal, your project will fail.
  • What solutions do you have to solve any of the limitations mentioned above? You should at least have a plan of how to deal with project constraints. If you don’t think about it now, you will have to later.
  • Who are the main stakeholders? It’s always important to remember the stakeholders of any project because the stakeholders are the ones you’re giving and, in a sense, managing their expectations. The sooner you get to know them, the sooner you can establish a constructive relationship with them.
  • What are the scope and out-of-scope items? The scope of the project defines the limits of your project; Like its start date and end time. So, what are project process parts, as opposed to tasks or actions that fall outside the project’s step-by-step process?
  • What are the possible risks of the project? Identify all possible risks in the project so that you are not surprised. This should be followed up with a risk register and project risk management plan in your project plan, where you explain how these risks will be resolved and which team members are responsible for resolving them.
  • What are the benefits of the project? A good way to sell a project is to understand how the project will benefit sponsors and stakeholders. Determine what those benefits are and list them here.
  • How much does the project cost? Although you will come across more details when preparing the project budget, this is where you should get a figure for the project budget and spending authority.

What are the uses of the project charter?

Many documents are required to implement a project. Before you get started, there’s a lot you need to create, from a project plan to a project budget and more. All of these documents detail the things you’ve covered extensively in your project statement. So, why do you need another document, isn’t it redundant?

The following are the three main uses of this document:

  • Target: You need it to approve the project license. This is the document that sells the project to your stakeholders and outlines what their return on investment will look like.
  • Scope: Now define the formal boundaries of the project by describing how the business will change with the delivery of the project, as well as those related to the scope of the project and beyond. With this method, you can have better control over the project.
  • Deliverables: A description of each of the deliverables that this project is tasked with producing. Once you have them all written down, your project charter will be ready to go. You can use WBS (Work Breakdown Structure) to identify deliverables.
Project organization
Project organization
Project organization

When you’re structuring your project charter, there are four subcategories you should identify. This is done by mentioning the following:

  • Customers or end users: To complete this list, ask yourself: What is the customer or end user in this project? Who are the clients of the project? Is a specific person or entity responsible for accepting project deliverables?
  • Stakeholders: As mentioned earlier, it is very important to identify the project’s stakeholders. They are a person or entity inside or outside the project that has a particular key interest in that project. The stakeholder might be a financial controller who oversees expenses or a CEO, but whoever it is will have a different focus depending on the role.
  • Roles: You should assign key roles and responsibilities to the people involved in project delivery, from the project sponsor, the board, and the project manager. After entering each role, write a short summary of their role and duties in the project.
  • Structure: Now you need to define the reporting lines between these different roles in the project. Use the project organization chart for this. This diagram shows the structure of an organization and the relationships and roles of the people involved

Conclusion

The project charter is the best project marketing tool. A project charter is created at the beginning of any project when we need to sell the project goals and project ideas. The project charter is an ideal place to document the relationship between the project and the organization’s strategy.

Check Also:

What is the work breakdown structure (WBS) in project management and how is it implemented?

What is project scope management and what is its importance?

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