In project management, the charter of a project , the definition of a project or the status of a project , is a document containing information about the scope of activities , goals and project participants. It provides a preliminary distinction between roles and responsibilities, describes the objectives of the project, defines the main stakeholders and determines the powers of the project manager . In fact, this document serves as a description for the future project, and the terms of reference are part of it.
The project charter should:
- Describe the essence of the project.
- Provide a common understanding of the project.
- Identify areas of responsibility between the project sponsor, key stakeholders and the project team
The project charter is usually a small document that refers to more detailed documents, such as project requirements .
According to the Initiative for Policy Dialogue (IPD), this document is called the draft charter. In the customer relationship management system (CRM), it is known as project definition. Both IPD and CRM require this document to be part of the project management process.
The project charter clarifies the powers assigned to the project manager. This is especially useful in a matrix management environment.
The purpose of the project charter is to document:
- Reasons for project implementation
- Project goals and limitations
- Decision guidance
- Indication of key stakeholders
- Objects within and beyond scope
- Risks identified at an early stage ( risk management plan should be part of the overall project management plan )
- Benefits of the target project
- High-level budgeting and identification of those responsible for expenses
Three main uses of the project:
- To authorize a project using a comparable format, for example, projects can be ranked and allowed by return on investment .
- It serves as the main sales document for interested parties with a project rating, has a 1-2 page summary to distribute, present and maintain convenience to prevent other projects or operations carried out in the project resources.
- Serves as the focus throughout the project. For example, as a reference strategy that can be used in team meetings and change management meetings to facilitate management.
For a large multi-stage project, a charter can be created for each individual step. For example, there may be a project charter during the “Niche” and “Search” stages of a project, followed by a planning charter and execution charter at the project assembly stage.
The charter of the project is created by the initiative group at the very beginning. The development of the charter and the identification of stakeholders are the two main actions of the initiative group.
Contributions for the development of the charter may be:
- Project Statement
- Feasibility Study
- Agreements and arrangements
- Enterprise standards, industry standards, rules and regulations
- Organizational process, structure and templates.
As a rule, the project manager leads the development of the charter based on his expertise and previous experience in developing the charter. The project manager in the process of developing the charter should work with key stakeholders (clients and business sponsors), specialists in the organization, subject matter experts inside and outside the organization, other units in the organization and can also work with industry groups or professional organizations. The project manager can use supporting activities such as brainstorming, troubleshooting, resolving contradictions, meetings, managing expectations, etc. to develop a charter.
Once drawn up, the charter will provide the project manager with the authority to officially execute the project and use organizational means and resources for the successful implementation of the project.