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Importance and Benefits of The Project Charter

What is the Project Charter:PMBOK® Defines Project Charter as a document issued by the project initiator or sponsor that formally authorizes the existence of a project, and provides a project manager with the authority to apply organizational resources to the project.PMI® gives a lot of importance to project charter. Project Charter will state the high-level requirements to satisfy the stakeholders’ needs and it also defines the authority of the Project Manager.Business Case and Project statement of work are the documents that are necessary to create a project charter. The purpose of a business case is to understand the business need for the project and determine whether it is worth investing in. Business needs or demands include market demands, organizational need, customers’ requests, technological advance, legal requirements, ecological impacts, and social needs.“According to the PMBOK® Guide, the business case is an economic feasibility study. It is used to track progress and compare project results against the success factors identified in the business case”.A project isn’t a project until the project charter is approved, and the project charter cannot be started until the business case is approved.The Project Charter highlights high-level initiation draft defined as below:Let's look at why the project charter is so important!The main purpose of the project charter is the formal authorization of the project and the go-ahead to commit organizational resources to it; without a project charter, the project can be canceled anytime and for any reason and can be subject to an audit as an unauthorized project.Let us imagine a project without a project charter. If there is no project charter, projects will have no direction. The Project Managers will lack authority. There will be no expectations for the projects undertaken. The scope of the projects will not be clearly defined.Let's consider a project has started for 2-3 months. A Project Manager is already authorized, and the project is moving well. Due to certain circumstances, current Project Manager resigns from the company and the project is assigned to another Project Manager. The initial task of every Project Manager authorized should be to go through the Project Charter to understand its business need and objective. The Project Charter project describes goals, scope, stakeholders and a high-level deliverable at high levels. Imagine project having no project charter then Project Manager would have been like a “Fish Out of Water”.What is included in the Project Charter?A Charter is a document that elucidates the project in succinct wording without a lot of details. It’s written for high-level management needs. Charter doesn’t provide detailed end goals, schedule, and cost.A Project Charter template may include some or all the following:Components of the Project CharterDo We Really Require Project Charter?Project Charter is important for the success of a project. The Project charter builds a foundation for any projects undertaken. It is a great communication tool for the stakeholders and provides a direction to the project.Following are few of the benefits of a project charter:It gives an authority to the project manager to complete the projectExplains the business importance and existence of project.Demonstrates Management support for the project.Defines outcome for the project.Aligns project with the organization objectives.Provides a team with a clear concise reporting system.Protects team members from scope creep.Helps in avoiding disagreements between stakeholders.Authorizes the existence of the project or establishes the project.Defines the parameters within which the project manager is authorized to operate.Gives the project manager authority to spend money and procure resources.Provides the high-level requirements for the project.Links the project to the ongoing operations of the organization.Process of project charter:The project charter is an important document and a project should not be started without one. The success of the project cannot be measured without a project charter.A project charter is important in the Project Management, because-It ensures that the project manager understands the sponsor’s needs and requirements.It provides vital information needed to get the projects started.It acts as a reference document to make sure everyone (i.e. Project Manager, Stakeholder, Higher Management etc.) are on the same page.It authorizes and protects the project manager by describing what are the benefits of the Projects that need to be achieved.* Remember According to the PMBOK® Guide, a project benefit is the result of actions or behaviors, and/or the value of the product, service, or result from the project brings to the organization and the project stakeholders.
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Importance and Benefits of The Project Charter

246
 Importance and Benefits of The Project Charter

What is the Project Charter:

PMBOK® Defines Project Charter as a document issued by the project initiator or sponsor that formally authorizes the existence of a project, and provides a project manager with the authority to apply organizational resources to the project.

PMI® gives a lot of importance to project charter. Project Charter will state the high-level requirements to satisfy the stakeholders’ needs and it also defines the authority of the Project Manager.

Business Case and Project statement of work are the documents that are necessary to create a project charter. The purpose of a business case is to understand the business need for the project and determine whether it is worth investing in. Business needs or demands include market demands, organizational need, customers’ requests, technological advance, legal requirements, ecological impacts, and social needs.

“According to the PMBOK® Guide, the business case is an economic feasibility study. It is used to track progress and compare project results against the success factors identified in the business case”.

A project isn’t a project until the project charter is approved, and the project charter cannot be started until the business case is approved.

The Project Charter highlights high-level initiation draft defined as below:
Project Charter initiation draft
Project Charter quote

Let's look at why the project charter is so important!

The main purpose of the project charter is the formal authorization of the project and the go-ahead to commit organizational resources to it; without a project charter, the project can be canceled anytime and for any reason and can be subject to an audit as an unauthorized project.


Let us imagine a project without a project charter. If there is no project charter, projects will have no direction. The Project Managers will lack authority. There will be no expectations for the projects undertaken. The scope of the projects will not be clearly defined.

Let's consider a project has started for 2-3 months. A Project Manager is already authorized, and the project is moving well. Due to certain circumstances, current Project Manager resigns from the company and the project is assigned to another Project Manager. The initial task of every Project Manager authorized should be to go through the Project Charter to understand its business need and objective. The Project Charter project describes goals, scope, stakeholders and a high-level deliverable at high levels. Imagine project having no project charter then Project Manager would have been like a “Fish Out of Water”.


Project Charter importance


What is included in the Project Charter?

A Charter is a document that elucidates the project in succinct wording without a lot of details. It’s written for high-level management needs. Charter doesn’t provide detailed end goals, schedule, and cost.

A Project Charter template may include some or all the following:
Project Charter template


Components of the Project Charter

Project Charter

Do We Really Require Project Charter?

Project Charter is important for the success of a project. The Project charter builds a foundation for any projects undertaken. It is a great communication tool for the stakeholders and provides a direction to the project.
Following are few of the benefits of a project charter:

  1. It gives an authority to the project manager to complete the project
  2. Explains the business importance and existence of project.
  3. Demonstrates Management support for the project.
  4. Defines outcome for the project.
  5. Aligns project with the organization objectives.
  6. Provides a team with a clear concise reporting system.
  7. Protects team members from scope creep.
  8. Helps in avoiding disagreements between stakeholders.
  9. Authorizes the existence of the project or establishes the project.
  10. Defines the parameters within which the project manager is authorized to operate.
  11. Gives the project manager authority to spend money and procure resources.
  12. Provides the high-level requirements for the project.
  13. Links the project to the ongoing operations of the organization.

    Process of project charter:

    Process of Project Charter

The project charter is an important document and a project should not be started without one. The success of the project cannot be measured without a project charter.

A project charter is important in the Project Management, because-

  1. It ensures that the project manager understands the sponsor’s needs and requirements.
  2. It provides vital information needed to get the projects started.
  3. It acts as a reference document to make sure everyone (i.e. Project Manager, Stakeholder, Higher Management etc.) are on the same page.

It authorizes and protects the project manager by describing what are the benefits of the Projects that need to be achieved.

* Remember According to the PMBOK® Guide, a project benefit is the result of actions or behaviors, and/or the value of the product, service, or result from the project brings to the organization and the project stakeholders.




Rajesh

Rajesh Bhagia

Blog Author

Rajesh Bhagia is experienced campaigner in Lamp technologies and has 10 years of experience in Project Management. He has worked in Multinational companies and has handled small to very complex projects single-handedly. He started his career as Junior Programmer and has evolved in different positions including Project Manager of Projects in E-commerce Portals. Currently, he is handling one of the largest project in E-commerce Domain in MNC company which deals in nearly 9.5 million SKU's.

In his role as Project Manager at MNC company, Rajesh fosters an environment of teamwork and ensures that strategy is clearly defined while overseeing performance and maintaining morale. His strong communication and client service skills enhance his process-driven management philosophy.

Rajesh is a certified Zend Professional and has developed a flair for implementing PMP Knowledge Areas in daily work schedules. He has well understood the importance of these process and considers that using the knowledge Areas efficiently and correctly can turn projects to success. He also writes articles/blogs on Technology and Management

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Methodology of calculating the function points

We need to understand a system first with respect to the function points for that consider an application model as below for measuring the function points. Now to calculate the function points we need to follow the following steps: Measure the application boundary The application boundary defines what is external to the application. It is dependent on the users external business view of the application and not on the technical and/or implementation consideration   Identify the data functionalities (ILF and EIF) User identifiable group of data; logically related and maintained with in the boundary of the application through one or more elementary process is know as ILF. User identifiable group of data, logically related, referenced by the application but maintained with in the boundary of different application is known as EIF.   Few other terminologies of RET and DET are to be understood here as well to determine the function points. 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Moreover, they empower their team mates to experience the vision of their own and offer other the opportunity to create their own vision, to explore what the vision will mean to their jobs and their lives, as well as to envision their future as part of the vision of their organization. 2.    They are a Good Communicator According to Jada Pinkett Smith, a slogan of every good project manager is; “My belief is that communication is the best way to create strong relationships” Another strong trait that distinguishes a good project manager from others is, their ability to communicate with people at all levels. Since, the project leadership calls for clear communication about responsibility, goals, performance, expectations, and feedback – a good project manager can be said a complete package comprising all these qualities. The pioneer must be able to successfully arrange and utilize influence when it’s important to guarantee the accomplishment of group and venture. How it comes about gainful? Successful correspondence brings about group accomplishments by making express rules for professional success of cable car individuals. 3.    Integrity One of the most important things any project manager should always keep in their mind is, it takes their actions to set a particular modus operandi for a team, rather than their words. A good management demands commitment and demonstration of ethical practices. The leadership or project management depends on integrity represents set of values, dedication to honesty, and consistency in behaviors with team mates. Integrity is that a good project manager takes responsibility for setting the high bar for ethical behaviors for oneself, as well as reward those who exemplify these practices. Leadership motivated by self-interest does not serve the wellbeing of a team. 4.    They Possess Leadership Skills If you want to become a successful project manager, you ought to own good leadership skills. Project managers must also deal with teams coming from various walks of life. Hence, it winds up noticeably basic for them to rouse workers and calibrate group execution to achieve organizational goals through various leadership styles. A great project manager sets the tone for the project and provide a clear vision about its objectives for the team. A feeling of foreknowledge helps also – by foreseeing potential issues, you can have your group prepared to solve them in the blink of the eye. Enthusiasm and passion are two key elements you should adopt, if you want to make people follow you—nobody will do so if you’re sporting a negative attitude. 5.They are Good Decision Maker Good decision making skill is not only crucial for personal life but it also very important in professional life as well. The good project managers are empowered to make countless decisions which will help define the project track. As we all know that a single minor wrong decision taken can easily jeopardize the entire project. Thus, a project manager needs to be capable of thinking quickly and reacting decisively. 6.    Expert in Task Delegation Task delegation is another basic skill in you which you need to be expert in. You should be able to judge your team members’ skills and assign the tasks in accordance with their strengths. Being a pioneer doesn’t imply that you have to consider each minor little detail of a venture. Show your team members you trust them and delegate tasks to them. 7.    They are Well Organized Henry Mintzberg said; “Management is, above all, a practice where art, science, and craft meet” Good organization is a key factor for creating a productive work environment as well as solving problems under pressure. Being well-organized helps to stay focused on the big picture and to prioritize your own tasks and responsibilities. With regards to exhibiting your outcomes, you ought to have the capacity to recuperate all the important information and demonstrate an intelligible vision of a venture to be executed. 8.    They Own Proficiency Proficiency and thorough knowledge – they both can be said a basic yardsticks on the basis of which a leader’s or manager wisdom or excellence can be weighed. Being on top of your projects entails a vast amount of industry knowledge to be effective in what you do. Some learning on the money related and legitimate side of your tasks won’t hurt either. You should be seen as able and skilled by your group. 9.    They are Great Problem Solver! The good project managers work with a team of experts or consultants and use their mastery of handling issues in most effective ways. 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