Project Charter

Quick reference

• 00:05 Hi, I'm Ray Sheen, I'd like to talk with you now about a very important element of
• 00:09 project initiation known as the Project Charter.
• 00:13 The project management body of knowledge, the PMBOK Guide,
• 00:17 defines a project charter as, a document issued by the project initiator or
• 00:22 sponsor that formally authorizes the existence of a project and
• 00:27 provides the project manager with the authority to apply
• 00:31 organizational resources to project activities.
• 00:34 That means that the charter is the founding document of the project.
• 00:38 With the foundation of a project charter,
• 00:40 the project leader can proceed with planning and executing the project.
• 00:44 Some organizations actually refer to this as a project contract
• 00:48 rather than a project charter, emphasized in the formal nature of the document.
• 00:52 As part of authorizing the project, the project charter sets the goals,
• 00:56 objectives, and the boundary conditions for the project.
• 00:59 It defines what is in this project and many times what is not in this project.
• 01:05 To create a project charter,
• 01:06 we need to identify those project elements that define the project.
• 01:10 There are several approaches for doing this.
• 01:13 Most common approach is to use a template that is part of the project management
• 01:16 methodology.
• 01:17 This will outline all that is needed in the project charter and
• 01:21 usually provides guidance or examples.
• 01:24 Another approach is to meet with stakeholders or customers and sponsors.
• 01:28 These are people who want the project.
• 01:30 They'll be receiving the benefit of the project and
• 01:32 I use my W questions with them.
• 01:35 It's also a good idea to meet with the team members or subject matter experts.
• 01:39 These people will know best how to do the project work.
• 01:42 Obviously, this includes the internal departments and
• 01:44 organizations providing the resources.
• 01:46 However, it can also include external experts such as consultants,
• 01:51 industry experts who have experience with this type of a project,
• 01:54 and can share the best practices.
• 01:57 If there is a project management office, you'll need to meet with them and
• 02:00 understand the elements of their project management methodology that is
• 02:04 being applied, and any project governance or oversight requirements.
• 02:08 They are also a good source of templates and best practices.
• 02:12 Finally, we need to review the business case.
• 02:15 This review ensures that we have a clear understanding of what's most important on
• 02:19 this project.
• 02:21 This includes the rationale for the project, what it's trying to achieve and
• 02:25 the project priority.
• 02:26 It will also, normally include a list of assumptions and constraints and
• 02:29 risks that are very helpful when planning.
• 02:32 Often when creating a project charter,
• 02:34 I'm using a combination of the various items on this list.
• 02:39 If you have a project charter template for your organization, use it.
• 02:43 If not, when establishing your project charter, consider including these items.
• 02:48 Describe the purpose or justification for the project.
• 02:51 Think of this as a mission statement for the project team.
• 02:54 Have a clear measure of success criteria for the project.
• 02:58 Both the team and stakeholders should determine the definition of done for
• 03:02 this project.
• 03:04 A shortlist of the high level requirements helps everyone to understand
• 03:08 the project scope.
• 03:09 Many times, the detailed requirements list will be developed as part of the project.
• 03:13 But a high level list now helps to set boundaries.
• 03:17 A list of major assumptions and
• 03:18 constraints, in particular, focus on scheduled milestones or
• 03:22 resource availabilities, assumptions, and constraints.
• 03:25 Project boundaries will clarify expectations with stakeholders and
• 03:28 team members.
• 03:29 We've talked some tools for this already, the Ws and
• 03:32 the in-frame outer-frame approach.
• 03:34 You should also list any identified high level risks.
• 03:37 It won't be a detailed list and risk responsive because you haven't done
• 03:41 a project plan yet, but this is just for awareness.
• 03:44 This is a great time to document the positive risk also in order to begin
• 03:48 to get buy-in and support for actions needed to take advantage of opportunities.
• 03:53 The charter will normally have a summary list of milestones and
• 03:57 external reporting points, also a summary budget is often included.
• 04:01 Typically, it's just the estimated total project cost, since we don't yet
• 04:06 have detailed project planning.
• 04:08 The initial stakeholders are often identified also in the charter and
• 04:12 that's so that the team knows who they need to communicate with and
• 04:15 coordinate with as the project unfolds.
• 04:18 A critical aspects of the project charter when there is not a strong methodology in
• 04:22 place is to identify that project manager and their approval authority.
• 04:27 When there is a strong project manager methodology in place everyone already
• 04:31 knows the authority of the project manager.
• 04:33 When there is not, it's needed to be clearly spelled out in the charter.
• 04:38 In addition to the stakeholders, you should identify the project sponsors or
• 04:41 the project management team that has to authorize this project.
• 04:46 Finally, your approval criteria and approvers for the project should be
• 04:49 clearly identified, if they weren't already mentioned among the sponsors.
• 04:53 The team needs to know who has final say when there's conflict on performance or
• 04:58 standards.
• 05:01 Project charter is your project's foundation,
• 05:04 make sure it's a firm foundation that you can build upon.

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