What Is a Project Charter and How To Write One?

A project charter is a document that lays the foundation for any successful project.

It’s a roadmap that aligns the project with organizational goals. This article will teach you all about project charters, their purpose, best practices, and how to write one.

Key Takeaways

A project charter is a formal document that defines a project vision and its purpose, scope, objectives, and key stakeholders. This document serves as a thorough roadmap for project managers, as it provides an extensive overview of the project’s purpose, deliverables, and constraints.

The purpose of a project charter is to align the project with the organization’s strategic goals, ensuring that resources are allocated to initiatives that support the company’s overall objectives.

The document is also a communication reference point because it clearly defines the project’s extent, objectives, and deliverables, which helps manage expectations. It also brings a common understanding of the project’s purpose.  

Additionally, the document provides a foundation for decision-making throughout the project lifecycle, as it establishes the project’s authority, governance structure, and key performance indicators.

The document guarantees the project contributes to the company’s strategic goals, justifying resource allocation. This well-written roadmap should articulate in detail how project outcomes support specific business objectives (so that stakeholders better understand its relevance).

When objective and strategic goals are clearly aligned and documented, it’s easier to gain buy-in and commitment from key decision-makers (like the project’s steering committee), increasing the likelihood of positive project outcomes.

Everyone involved in a project needs to be on the same page. The document is a reference point for all communication regarding the project’s goals, extent, deliverables, timeline, requirements, and needed resources.

The project charter document facilitates communication among the steering committee members, project managers, and team members.

Other than aligning goals and fostering communication, the document defines the level of authority of decision-makers in the project (who reports to who and who has the authority to make impactful project decisions).

The key elements of a project charter are clearly defined project objectives, key deliverables, benefits, the outline of the project scope, and a timeline with major milestones. As said, the document also identifies the project stakeholders and clarifies their essential roles and responsibilities.

Below is a breakdown of each element:

The document has to have a detailed breakdown of high-level objectives. They should be specific, measurable, achievable, relevant, and time-bound (SMART objectives), while benefits should align with organizational goals.

This component outlines the boundaries and deliverables of the project. It defines what project deliverables are included and excluded, ensuring that all project participants are on the same page. You’ll need to specify the project’s objectives, deliverables, and any constraints or assumptions.

Effective project planning and project management need a detailed high-level timeline. Your project timeline should outline the project’s key phases, activities, and deliverables, while the milestone schedule marks significant points in the project’s progress.

One essential aspect of developing a thorough project charter is identifying and engaging key stakeholders. You’ll need to determine who will be impacted by the project, who can influence its success, and who has a vested interest in the outcome.

This includes project sponsors, team members, end-users, and external parties. Collaborating with stakeholders from the outset helps align everyone’s expectations and goals.

Sometimes, people involved in the project step on each other’s authority zones. This often hampers the project execution; in some cases, it can spell disaster. The root of this problem is miscommunication. Managerial roles and responsibilities need to be clearly defined.

Key roles typically include:

Documenting responsibilities guarantees accountability, fosters collaboration, and mitigates confusion. Regularly review and update roles as the project evolves to maintain alignment.

The document needs to include an overview of the resources and requirements needed to complete each of the project phases successfully. This essential component defines the project budget and resources required to successfully complete the initiative.

You’ll need to specify the financial resources, including the high-level budget, funding sources, and any budget constraints or limitations.  

Additionally, outline the personnel, equipment, materials, tools, and other resources necessary for the project. The goal here is to ensure they’re allocated efficiently to support the project’s objectives and deliverables.

Identifying potential risks and clarifying assumptions are mandatory steps in crafting a detailed charter. Every project plan needs to have a risk register with all the potential risks and their mitigation strategies.

Think about the following:

You’ll typically create a project charter during the project initiation stage as part of the strategic planning and organizational approval process. As the document outlines the project fundamentals, everyone needs to approve it before the project officially starts.

Developing the project charter early on guarantees that all stakeholders are aligned on the project’s purpose, goals, and constraints. Clearer and aligned expectations return in the form of smoother execution and minimized potential misunderstandings or scope creep.

Let’s see how this document translates in the early project stages.

In the project initiation stage, you need to set some foundations. At this starting point, you’ll have a lot of defining tasks to do. We’ll talk more about charter writing tips later, but for now, it’s important to think about the following:

The charter gets approved in the strategic planning process, so you have to create it early on. Your charter needs to pass the internal organizational approval process.  

Getting their buy-in secures necessary resources. Review the document before you send it for approval so that in case any misunderstandings come up, you always have a reference for communication.

Here, you need to seek approval from:

To write an effective project charter, you’ll need to clearly articulate the project’s goals and purpose, defining what success looks like and why the project matters. You should also establish the project’s boundaries, outlining what’s included and excluded, as well as identify key participants and their roles.

Finally, create a high-level implementation plan that outlines the project’s phases, milestones, and deliverables.

Again, let’s break down each step.

Clearly defining project goals is a critical first step in crafting an effective project charter. Articulate the desired outcomes and objectives.

Make sure the goals are:

Now that you’ve established clear project goals, it’s important to define the project’s purpose in your charter. The purpose statement should explain why the project is being undertaken and what it aims to achieve.

It should align with the organization’s strategic objectives and provide a compelling reason for investing resources in the project. Write a concise, impactful purpose statement that’s easy to read and understand.

Once you’ve defined the project’s purpose, the next step is to establish and write the project scope statement. The scope defines the project’s boundaries, specifying what’s included and excluded.  

Healthy scope management helps prevent scope creep and makes the execution smoother.

Consider the following aspects when defining the scope:

Here, you need to determine who’ll be impacted by the project’s outcome, including team members, sponsors, customers, and end-users. Engage these individuals early on to gather their input and expectations.

The implementation plan outlines the project’s execution strategy (how to execute), key project milestones (main progress points), and deliverables (what needs to be delivered). The implementation needs to be done in phases, so make sure to outline each phase in detail.

Your plan should include:

A well-defined implementation plan coordinates key participants and their teams so that all objectives are delivered on time.

So far, you’ve defined the project goals, established the project extent, identified the key individuals, and created an implementation plan. Before all of these components can come together, you need to do some financial estimating.

When developing your budget, consider every actual cost, including labor, materials, equipment, and contingencies. Collaborate with stakeholders to gather input and validate assumptions. Use historical data and industry benchmarks to inform your estimates.  

Document your budget in detail, break down costs by category, and be prepared to justify your projections.

While writing the project charter, you might want to use a project management software like Productive. These tools make communication, documentation, and project execution smoother and more effective.

Plus, you get all the actionable data to keep your projects on track.

The difference between a project charter and other documents is their overall purpose in project management. Let’s take a closer look at the differences between a project charter, a project plan, and a business case.

The project charter is a high-level document that authorizes the project and outlines its key objectives, while the project plan provides a detailed roadmap for executing the project.  

The project plan typically includes:

Both documents are essential in the project initiation phase, but they differ in their focus and level of detail. The business case concentrates on the project’s viability, analyzing costs, benefits, and risks.

On the other hand, the project charter outlines the project’s extent, objectives, and deliverables at a high level, serving as the formal authorization to commence the project.

The best practices of project charters are to clearly define the project’s scope, objectives, and deliverables, identify key stakeholders and their roles, and establish a realistic timeline and budget. Also, you need to outline potential risks and mitigation strategies and make sure that the charter is concise but thorough.

One example of a well-structured project charter comes from Harvard University Information Technology (HUIT). The HUIT team wrote a sample charter for evaluating Harvard’s internal business processes related to annual faculty effort certification and monthly staff salary certification for sponsored projects.

The goal was to recommend technology solutions that reduce administrative burden, streamline processes, mitigate risks, and ensure compliance with institutional regulations.

Project Objectives:

Project Scope/Deliverables:

Project Roadmap:

Assumptions:

A project charter is your blueprint for success. It clarifies the project’s purpose, boundaries, and deliverables, aligns stakeholders, and serves as a reference throughout the project lifecycle.

When you invest time upfront to create a thorough charter, you’ll establish a solid foundation for effective planning, execution, and communication. Remember, a well-crafted document is a must-have reference tool for project success.

Writing effective charters is much easier when you have all the key data in one place. This place should also have other important features like detailed reports, task management capabilities, and budget tracking and workload views.

The mentioned place is actually a project management tool called Productive. Book a demo or claim a free trial to learn more about what can Productive do for your projects.