The Importance of a Project Charter and Project Business Case
Project Charter :
A project charter is a formal document that describes the purpose, scope, objectives, and stakeholders of a project. It is used to obtain approval for the project and to provide a high-level overview of the project to key stakeholders.
The project charter is typically created by the project manager, with input from the project sponsor, key stakeholders, and other members of the project team. It is reviewed and approved by the project sponsor before the project can begin.
The project charter should be a living document that is updated as the project progresses. This ensures that the project remains aligned with the organization's strategic goals and that the project team is aware of any changes to the project scope or objectives.
Components of a Project Charter :
The following are the key components of a project charter:
Project Purpose or Justification: This section outlines the rationale for undertaking the project, including the identified business need or opportunity that the project aims to address.
Project Objectives: Clear and measurable objectives are defined to determine the project's success criteria. These objectives should align with the organization's strategic goals.
Project Scope: The scope statement defines the boundaries of the project by specifying what is included and what is excluded. It helps in clarifying the project's focus and avoiding scope creep.
Stakeholders: Identification of key stakeholders, including the project sponsor, customer, and other relevant parties, is essential. Understanding their expectations and requirements is crucial for project success.
High-Level Requirements: This section highlights the major requirements that the project needs to meet. It provides an overview of what the project is expected to deliver.
Assumptions and Constraints: Assumptions are factors considered to be true, real, or certain for planning purposes, while constraints are factors that limit the project team's options. Both need to be documented to provide clarity and guide decision-making.
Milestones or Deliverables: Key project milestones or deliverables are identified to monitor progress and provide a basis for project control.
Project Organization: The project charter typically includes the roles and responsibilities of the project team members, project sponsor, and other relevant stakeholders.
High-Level Risks: Major risks or potential obstacles that may impact the project are identified. These risks can be further assessed and managed during the project planning phase.
Importance of a Project Charter
The project charter is an important document that serves several purposes, including:
Obtaining approval for the project: The project charter is used to obtain approval for the project from the project sponsor and other key stakeholders. It provides them with a high-level overview of the project and helps them to understand the benefits of the project and the risks involved.
Communicating the project's purpose and scope: The project charter communicates the project's purpose and scope to the project team and other stakeholders. This helps to ensure that everyone is on the same page and that the project is aligned with the organization's strategic goals.
Serving as a reference document: The project charter serves as a reference document throughout the project lifecycle. It can be used to track the project's progress, make decisions, and resolve conflicts.
Establishing a baseline for project control: The project charter establishes a baseline for project control. This means that the project's objectives, scope, and budget are set at the beginning of the project and are used to measure the project's progress throughout the lifecycle.
Creating a Project Charter:
The following are some tips for creating a project charter:
Involve key stakeholders: The project charter should be created with input from key stakeholders. This ensures that the project charter reflects the needs and expectations of all stakeholders.
Keep it concise: The project charter should be concise and easy to understand. It should not be longer than a few pages.
Use clear and concise language: The project charter should be written in clear and concise language that is easy to understand. Avoid using jargon or technical terms.
Be specific: The project charter should be specific and provide clear details about the project. This includes the project's purpose, objectives, scope, deliverables, and stakeholders.
Be realistic: The project charter should be realistic and achievable. It should not set unrealistic expectations for the project.
Be flexible: The project charter should be flexible and adaptable. It should be able to accommodate changes to the project's scope, objectives, or budget.
The project charter is an important document that serves several purposes. It is used to obtain approval for the project, communicate the project's purpose and scope, serve as a reference document, and establish a baseline for project control. The project charter should be created with input from key stakeholders and should be concise, clear, specific, realistic, and flexible.
Project Business Case:
In PMBOK7, the project charter is replaced by the "Project Business Case". The Project Business Case is developed during the Define Project or Phase process, which is part of the new Initiating and Planning domain.
The Project Business Case is a document that describes the business need for the project, the project's objectives, the project's benefits, and the project's risks. It is used to obtain approval for the project from the project sponsor and other key stakeholders.
The Project Business Case should be concise, clear, and specific. It should be written in a way that is easy for the project sponsor and other key stakeholders to understand.
The following are the key components of a Project Business Case:
Business Need: This section describes the business need for the project. It should explain why the project is necessary and how it will benefit the organization.
Project Objectives: This section defines the project's objectives. It should be clear, measurable, and achievable.
Project Benefits: This section describes the benefits that the project will deliver to the organization. It should be quantifiable and realistic.
Project Risks: This section identifies the risks that could impact the project. It should include a risk assessment and a plan for mitigating the risks.
The Project Business Case is an important document that serves several purposes. It is used to obtain approval for the project, communicate the project's purpose and scope, serve as a reference document, and establish a baseline for project control. The Project Business Case should be created with input from key stakeholders and should be concise, clear, specific, realistic, and flexible.
Here are some of the benefits of using a Project Business Case:
Increased project success: Projects with a well-defined business case are more likely to be successful. This is because the business case provides a clear understanding of the project's purpose, objectives, and benefits.
Improved decision-making: The business case provides information that can be used to make informed decisions about the project. This includes decisions about the project's scope, budget, and schedule.
Increased stakeholder alignment: The business case helps to ensure that all stakeholders are aligned on the project's purpose, objectives, and benefits. This can help to reduce conflict and improve communication throughout the project lifecycle.
