When you discuss a project with a client or potential client, determining the project scope occupies a crucial part of that exchange of information in the negotiation of service for money. One tool that helps to define the project’s parameters in such a way that all parties understand their obligations and responsibilities is a project charter.

Workzone.com states that project charter exists under different names: project definition, project statement, or business case. As Shakespeare once said about roses and other names, call a project charter whatever you want and it will still work as intended only if all parties adhere to the terms.

The benefit of the project charter lies in its clarity. Part of the advance preparation of a project, the project charter, says Workzone, “defines the fundamental information of a project and clearly outlines its goals and objectives.” In short, the project does not begin until after all parties have signed their approval and understanding. The project charter establishes benchmarks for progress and determines the metrics for success. It points team members in the right direction and defines project completion. The Balance also notes that a project charter identifies the project manager and authorizes him or her to perform the work mandated.

Project charter elements

A formal project charter may extend only a few pages or it may look like a manual, but the content generally follows a standard order after naming the project, the stakeholders, the project manager, and the date of preparation.

1. This section answers the question of Why are we doing this? If the client can’t answer this, then your client has a lot of hard thinking to do.
2. This section provides details on the deliverable outcomes and answers the question of What are we going to achieve? Once again, the bulk of this information rests upon the client because the client needs to know and be able to recognize the desired outcome of the project.
3. Because this is a pre-work document, it’s not possible to know all the financial details; however, it is possible to anticipate major budget items and constraints. Identify these so everyone acknowledges them.
4. Every project has them. Anticipate the risks, how they might affect the project, and how you intend on dealing with them.
5. Set milestones that measure progress. The identifying goals signal when a phase is completed and the work is ready to move on to the next phase, or when a task is finished and the project manager should move it along to the next team member.
6. This section answers the question When will we know the project is completed? The answer describes the deliverable in detail, which reins in scope creep.
7. Does every project benchmark need the president’s or CEO’s approval to move on to the next step, or can these be delegated to lower level personnel? How far does the project manager’s authority extend? Can she hire and fire team members and vendors or authorize spending within a certain amount without executive approval?

Consider the charter the governing document for the project. It arises from a process of discussion, negotiation, and agreement and serves as a reference guide throughout the duration of the project.

The Heggen Group specializes in developing process-oriented documentation such as project charters that help businesses manage both the delivery of work and client expectations.