The Project Charter Is Similar To the Magna Carta
The project charter is the section of a project management where the scope, goals, and resources are clearly defined. Some companies call this the Project Definition, Initiative for Policy Dialogue, or Terms of Reference. No matter what you call this, its roll is the same.
In the project charter, what needs to be accomplished, by whom, in what time span, where the money to support the project is going to be coming from, and the resources that will be available all need to be documented. There will also be a section on all responsible parties that are involved with the project. This is to include the project manager assignment and any passive members, like shareholders or stake holders to whom the progress of the project will be reported to.
For some companies, the project charter is more of a table of contents, along with a general agreement. This way, the specific details of the project can be formally documented in the “New Offering Request” or “Request for Proposal”.
In a project charter, the reasons why a project is being undertaken needs to be stated. The goals and constraints need to be listed, along with any solution the project is designed to address. The participants also need to be properly identified.
The project charter is used so formal authorization of the project can be designated, and who is going to be responsible for it. It can also serve as the primary sales document to the shareholders and other financial sources that are involved. The final reason this document is created is so there is a focal point of the project that is clearly defined. This way, new members of the team will be able to see the scope and aim of the project that they have just joined.
The project charter is a fundamental part of any project that is undertaken by a company in pursuit of a final objective. Without one, a project could stray from its intended path.