If you spend time seeking management or customer approvals for your projects, you know how messy and drawn out the process can be, as the decision makers request clarification on things like project deliverables, risks, resources, and financial payback. The result can be an excessively long approval process, with lots of email and follow-up activities. Much, if not all of this wastefulness can be prevented with a well written project charter.
How You Will Benefit From a Well-Written Charter
An effective charter will –
- speed up the approval process by answering key questions during the charter approval meeting
- clearly define what the project will and will not accomplish
- build management and/or customer confidence in you as a project leader
For most projects, a one-page summary like the example below is preferred, since it pulls all critical project information into a concise and easily-reviewed document.
Finding the Right Format
We recommend the following approach for writing an effective project charter –
- Find out if your organization uses a standard charter template. If so, get a copy. Also consider asking around the organization for previously-approved charters – this will help you understand what a successful charter looks like in your organization.
- If your organization does not use a standard template, consider introducing one. The Excel template below is a great starting point. Review the template with the customer and/or stakeholders ahead of time, and ask for their feedback.
- Identify the key individuals who can help you with the charter. For example, you may need input from someone in finance when it comes to the project’s financial justification, or maybe a subcontractor quote is needed for estimating the total cost and timing for a critical piece of the project.
- Touch base with your customer and/or stakeholders, and ensure that their needs are being addressed in the charter. For example, an engineering leader may have concerns about a risky new technology that a successful project outcome depends on. Listing the applicable risks on the charter document will not only put the engineering leader’s mind at ease (making for a much smoother approval meeting), but will also communicate the risk level to the customer and/or stakeholders, preventing unwanted surprises later in the project.
Project Charter Example and Template
Here is an effective project charter completed in Microsoft Excel (file link). You can update this format to include your company logo, etc.
No matter which charter template you choose, there are a few things that just about all charters have in common:
Most, if not all charters contain a clear, concise business case. This is a good time to imagine yourself as the business owner or CEO, and think about what’s really important. In this example, a project team will recruit a new organization for a consumer and industrial products manufacturer. The new organization will ensure that product ideas are proven out with consumers before substantial capital and other resources are committed to the product. Here is the business case wording –
“End-user feedback is essential early in the product design process, before designs are finalized and investments are made in tooling and equipment. This project will implement the End-User Feedback Team – a new organization that will (1) gather end-user product preferences prior to prototyping, (2) solicit feedback on prototypes, and (3) conduct field testing with engineering-build products (prior to production tooling).”
Note that the business case is concise, well structured, easily understood. A well-stated business case should convey the message, read on, this is interesting!
A clearly defined project will help prevent scope creep. Scope creep is a natural but undesirable evolution in the project scope that takes place after a project is launched. Scope creep happens when leaders and others in the organization assume that the project team will take on more than it signed up for. So it is important to state what is in scope and out of scope in the project charter.
For the above example, the project charter clearly states that the end-user feedback team will be focused on domestic, industrial products, leaving consumer and international products out of scope.
Key deliverables state specifically what the project will deliver to the customer or organization. Key deliverables must be tangible outputs that the management team can easily visualize. In the above example, all the deliverables meet these criteria –
- proposed and approved organizational charts
- finalized budget and job descriptions for the new organization
- manager and team hired
- team training and orientation complete
Project Timeline (Milestones)
The project timeline shows the anticipated completion dates for the project’s milestones. In the example above, the manager for the End User Feedback Team will be in place by 7/1, an important milestone in the project. Knowing that most charter approvals take time, it’s important to note the project start-date assumption that the milestone dates are based on.
Depending on the project type, one or more financial justification metrics can be added to the project charter. Typically the total project cost (capital and expenses) are noted on the charter, along with a rate-of-return metric such as the internal rate of return (IRR).
A well-thought-out project charter should speed up the approval process and save a great deal of follow-up work answering basic questions. For more information on project management, visit the Project Management Institute website (pmi.org).