What is Project Charter (In simple words)

The Project Charter is a document that is developed before the start of the project.

The purpose of a business charter includes:

   1. It provides high-level information about the project requirements, such as project scope, schedule, constraints, quality, cost, risks, resource and other requirements.
   2. It actually formally authorizes the the project.

Besides providing authorization to apply organizational resources to the project, the project charter names the project manager. In addition, it sets forth known stakeholders.

In addition to these, the project charter also defines the business objectives, project cost-benefit analysis and the reasons for undertaking the project.

In small organizations, the project charter could may be an informal instruction to start a project.

Project Charter Content

Mainly, this document includes project name and high level project scope, schedule, cost, resource requirement, high level issues and risk detail. We also identify the major stakeholders. In addition, the charter contains the project background, objectives and mission. Another major component of a project charter is the business case. Business case describes the business need of the organization due to which the project is being undertaken. It further adds in it the cost-benefit analysis for the project and describes any constraints and assumptions with regard to this.

Project charter could be written in different ways but what makes it effective is that it should be easy enough so that it can easily be read and understood by people including the project manager, the project team and the other stakeholders. So, there are many benefits of a project charter. It helps in avoiding disagreements between the project stakeholders. The information contained in the project charter defines the project outcomes as well as the parameters within which the project should be executed. Hence, a project charter is an important document and a project should not be started without one.

For a sample project charter template, click here.

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