The Value of a Project Charter

If you’re familiar with the Project Management Book of Knowledge, or PMBOK for short, you know all about the Project Charter and its criticality to the success of a project. The PMBOK says that the project cannot start until the Project Sponsor formally signs off on the Charter.

Having worked at midsize companies for nearly 15 years, I learned that actual Project Charters with formal sign-off are more of a “big company” thing. To date, I haven’t once been required to write a Charter or get one approved to begin a project. Let me tell you why I insist on a Charter and have more than just the Project Sponsor sign off before I kick off a project. Come with me on this thought journey.

If I had to pick a single area of knowledge from the PMBOK as the most critical, I would pick Stakeholder Management. You can have the best plan and the best tools, but a tumultuous stakeholder situation can completely derail a project. On the flip side, you can have a scrappy team with few processes and subpar tools, but with committed people working well together, a project can succeed in spite of other project elements being challenging.

If I had to pick an area of knowledge to be second most critical, it would be Time Management. This encompasses your ability to scope the project, break it down into tasks, understand dependencies, build a project schedule, and keep the team aligned with each other as well as the schedule. In a sense, it’s a superset of a few other areas and captures the core of your project plan.

Enter the Project Charter, which I would argue is the most critical project artifact. Below are the basic elements of a good Project Charter:

1. Problem statement
2. Business case
3. Goal statement
4. Timeline
5. Scope
6. Team members

Diving into these 6 elements, we see 1, 2, 3, and 6 align to Stakeholder Management and 4 and 5 align to Time Management.

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Let’s start by looking at the Stakeholder Management elements.

• Problem statement – Having this clearly written in the Charter ensures that key stakeholders agree a problem exists. They are agreeing on what that problem is. Finally, they are agreeing that this project is the right approach to solving the problem.
• Business case – Here is where stakeholders are agreeing that this project is worth the resources. It’s possible to have everyone agree that a problem exists and needs to be solved, but it’s something entirely different to agree on its priority and resourcing.
• Goal statement – Different people can look at the same problem and come to a different conclusion about how to solve it. Articulating the goal in writing will avoid assumptions and make it clear to stakeholders what everyone is working toward. Without stakeholder alignment on the project goal, the project is doomed to become tumultuous when the project team inevitably encounters a fork in the road.
• Team members – We’ve agreed we have a problem to solve, we’ve agreed it’s worth investing in, and we’ve agreed on what the ultimate goal looks like. This section gets specific about whose time will need to be invested, what the commitment is, and what their responsibilities will be. Key stakeholders reviewing the Charter will be able to think through the impact on their teams and make sure they are able to commit the team members required. They will also be able to identify other team members who may not be listed, helping to complete the project team.

Our remaining two elements are tied to Time Management, though agreement on these is also inextricably tied to Stakeholder Management.

• Timeline – To be able to write this section of the Charter, you will have had to do some high level project scoping and establish your project structure. Do you have phases? Stagger starts? Is your execution stage planned to be managed using Agile methodology, so the timeline needs to be flexible? All of those considerations and more are required for a timeline estimate. Putting this estimate in front of key stakeholders in the Charter ensures they understand the high level of time commitment. This provides an opportunity for discussion if some stakeholders think it needs to be completed faster or someone says they can’t commit the required resources for the deadline, so the project needs to be extended.
• Scope – They say the devil is in the details, and this is where those details live. Clarity on scope allows for work estimates, project scheduling, and work coordination among team members. Clarity on out-of-scope work is just as important, because that enables you to define “done,” wrap up the project when in-scope deliverables are complete, and hand off deliverables and/or processes to business-as-usual owners for long-term ownership. The clearer you can be about your scope in the Charter, the fewer struggles you’ll have with scope creep later.

I personally expand on these base elements with a couple of my own tried-and-true tools. Seizing the opportunity to get stakeholder alignment, I also include the below:

• Communication plan – I use this section to detail what information will be shared with which stakeholders as well as the method I will use. This is especially important if some team members or stakeholders are in different time zones, and even more important if there are people from multiple cultures. Communication norms vary in different cultures, so I like to ensure everyone knows what to expect and has an opportunity to raise a hand if they need something different from what I had originally planned.
• Project change management – What are the criteria for something to be considered a project change? What process does it go through to be approved? Who has the authority to approve a change? Stakeholder alignment up front will save time and struggle when someone wants to add a deliverable to the project or expand the project to include related work that is discovered during project execution.

The Project Charter provides the best opportunity for you to detail critical components of your project and get stakeholder alignment. You can’t possibly list every detail, but you can align on your plans, processes, and expectations so everyone is working in the same way when questions and challenges inevitably arise.