What is a project charter in project management? (+ project charter template)
Suppose you have a great business idea for your department’s next project. But, having an idea is not sufficient to bring your project to life. You must present it to the right people and get their approval. For this purpose, you need a project charter.
In this guide, you will find out what a project charter is, but also what it isn’t.
After providing a definition, we will list the most common project charter elements.
Then, we will explain its primary purpose and the main differences between the project charter and a project plan, a project brief, and a business case.
To make the concept clearer, we will also provide an example of the project charter — followed by valuable tips on building this project management document.
Let’s dive into the matter.
What is a project charter?
In a nutshell, a project charter is a document that formally acknowledges the existence of a project.
It acts as an elevator pitch for your project and aims to secure approvals for its execution.
In the project charter, you should provide a brief explanation of the main elements of your project. This document enables project stakeholders to understand your project objectives, scope, and responsibilities. In other words, it is a high-level overview of your project.
When approved, the project charter gives a project manager the authority to apply organizational resources to project activities.
You may also want to know who is in charge of issuing this document. This is usually a project sponsor or the person who initiated the project.
What is the main purpose of a project charter?
There are several reasons why you need a project charter. Here are the most important ones:
- The project charter serves as the project’s marketing tool to secure stakeholders’ approval — It’s a brief description of your project, and it “sells” your project to key stakeholders in charge of the project approval.
- The project charter authorizes the existence of a project — Without getting approval from stakeholders — there is no project. The primary purpose of a project charter is to authorize the existence of your project. After project charter approval, a project manager can begin initiating and executing the project.
- The project charter explains the business importance of the project — Before carrying out a project, you need to make sure that stakeholders understand the business importance of the project and where they are investing their resources.
- The project charter helps prevent scope creep — It outlines the project’s parameters so that everyone can understand them.
What are the elements of a project charter?
There is no universal list of project charter elements. But, we can provide one that works for many different types of projects and businesses. So, ideally, your project charter should have the following sections:
- Project title,
- General project information,
- Project purpose,
- Project team structure,
- Key stakeholders,
- Success measurements, and
- Project approval.
Let’s briefly explain everything mentioned.
It’s quite clear that every project needs a title.
For instance, if you intend to develop additional landing pages for products on the website you are developing, the name can be “Developing new product landing pages — website X.”
The name should be straightforward — you don’t need any fluff.
General project information
As its name suggests, this section is dedicated to general information. It specifies:
- The project manager,
- The project sponsor,
- The business unit, and
- The date when you pitched the project.
After providing basic information, we need to explain why we want to conduct a particular project.
The project purpose section should justify your project, so describe your project in a few sentences.
- Explain which business needs this particular project will meet,
- Identify what you want to achieve with your project, and
- Explaining how your goals and objectives align with larger organizational goals.
For setting your project goals and objectives, you can use the S.M.A.R.T. criteria.
It states that your goals and objectives should be:
- Realistic, and
Explain what in-scope and out-of-scope items are. You should describe what will be included in the project tasks and briefly summarize what will NOT be included.
Suppose you are developing a website for someone else. People have different expectations. Therefore, you need to ensure you are on the same page with your client.
Maybe your client thinks data entry is included in the site development, but it is not. For that reason, you need to determine in-scope and out-of-scope items.
In this case, in-scope examples can be:
- UI and UX design,
- Responsive design,
- Image optimization,
- Cloud backup,
- Basic analytics,
- Optimized site loading time, and
- Simple design modifications, such as color and category names.
Out-of-scope examples can include:
- Increased number of deliverables,
- Modifications to product features,
- Additional requests related to product features, and
- Data entry.
In this section, you should describe project deliverables. According to Investopedia, deliverables are “the quantifiable goods or services that must be provided upon the completion of a project.”
They depend on your project type. Examples of deliverables include:
- Business cases,
- Landing pages for different products,
- Wireframes, etc.
Defining deliverables provides a clear end goal for your project, which makes your project charter much more valuable to stakeholders — and more likely to get approved.
💡 Plaky Pro Tip
If you want to learn more about deliverables in project management, check our guide:
Every project requires resources. You must have at least an estimated project budget.
In addition to the financial resources necessary for the project, it is essential to identify how many people you will need.
You also need to determine which equipment and other resources you may need, depending on your industry, project type, and complexity of the project.
Just as we need to know what we want to achieve with a specific project, we must also identify project duration and activities.
So, specify when the team starts working on the project and the anticipated end date — considering current business resources.
In addition to predicting start and end dates, identify all key project milestones and when they will be completed.
In this section, you need to provide a list of potential risks and explain how they can affect the outcome of your project.
Risk identification in this early stage can help mitigate more significant issues once the project begins.
So, take your time to ponder potential project risks and write down what could go wrong.
💡 Plaky Pro Tip
Find out more about risks in project management in our guide:
Project team structure
Make a list of people who will participate in the project and specify their roles and responsibilities.
In order to do that, you need to answer the following questions:
- Who will be responsible for managing the project?
- What are other people who will be working on the project?
- What are their responsibilities?
It is vital to name the main project stakeholders.
Stakeholders can be within or outside the organization, and they can have an influence on the project’s outcome.
You should mention who’s in charge of:
- Project charter approval,
- And any other key responsibilities.
Identify the metrics you will be using and the targets you want to achieve with your project.
For example, you can mark the project as successful if you achieve overall cost savings of $100,000 or reduce production time by 25 percent.
In the end, specify who signs off on the project.
This section identifies the people in charge of approving the project charter.
After identifying its elements, it’s time to explain what is not a project charter.
What a project charter is NOT?
A project charter is just one of the project planning documents you can create.
Other planning documents include:
- A project plan,
- A project brief, and
- A business case.
These documents are not interchangeable, so make sure you understand when to use each one.
Here are some brief explanations of their purpose and how they are different from the project charter.
Project charter vs. project plan
A project charter is created before a project plan, and its purpose is to secure project approval and give the project manager authority to start working on the project.
In contrast, we create the project plan after getting the project charter’s approval.
Unlike the project charter, which describes the entire project on a macro level, the project management plan goes into the essence of all the phases.
The project plan provides a more in-depth outline of the project’s key elements and explains how project activities will be executed. It is a detailed document that describes how to achieve the project objectives.
Project charter vs. project brief
A project brief is a document that provides a brief description of the key elements of your project plan. While a project charter aims to authorize the project formally, we create the project brief after obtaining the project’s approval.
The project brief is the summary of the project plan — it is the overview of the key high-level details of the project plan.
This document communicates project requirements without too many details. It serves as the reference point for your project team and stakeholders.
Project charter vs. business case
A project charter and a business case are both created in the project initiation phase. But what is the difference?
In simple words, the business case explains why the company should spend its resources on a specific project and the benefits and risks of significant business investment. It makes assumptions about a project in terms of its costs and expected revenue.
Based on that, it determines if the project is financially justified. On the other hand, the project charter tells at a macro level what needs to be done and what the constraints are in terms of budget, timeline, and scope. So, these two are not interchangeable terms.
Project charter example
Now that we’ve explained all the elements, it is time to see the project charter in action.
To illustrate the matter, we will provide an example of a project related to mobile application development.
Suppose you want to develop a food ordering app.
Then, your project charter can look like the following example.
|Project title||Go Guacamole food ordering app|
|General project information||Project manager: Marry Stark|
Project sponsor: James Jones
Business unit: Product development
|Project purpose||– Food ordering app for vegans and vegetarians. |
– The app will be available on Google Play and App Store.
– The aim is to simplify vegetarian and vegan food ordering from our physical Go Guacamole stores.
– The app enables ordering via a mobile phone and delivery in major US cities.
– Operating system: iOS, Android,
– UI and UX design,
– Image optimization,
– Cloud backup,
– Basic analytics,
– Load testing, and
– Basic design modifications.
Out of scope:
– Adding new plugins or functionalities,
– Managing product inventory, and
– Marketing automation.
|Project milestones||Start date: April 4, 2022|
Design proposals finished: May 4, 2022
App development completed: July 7, 2022
QA testing ended: August 15, 2022
Product descriptions completed: August 26, 2022
Launching date: September 1, 2022
|Goals and objectives||– Increasing sales by 20% in the first quarter after launching|
– Establishing our company as a leader in the vegetarian and vegan food space in the US
|Deliverables||– Style guide,|
– User Interface,
– Compiled versions of the app,
– Private keys and certificates,
– Other development specifications, and
– Bug and issue documentation.
|Risks||The team may not meet deadlines due to:|
– Adding unplanned changes in the specification or expanding requirements with more features.
|Resources||People: 11 people working on a project |
– 3 developers,
– 1 project manager,
– 1 business analyst,
– 1 finance manager,
– 2 designers,
– 1 product manager, and
– 2 QA software testers
Time: 5 months for project completion
|Key stakeholders||CEO: Peter Drake|
Project sponsor: James Jones
Project investor: Mark Johansson
|Project team structure||Project manager: Marry Stark |
Product manager: Emily Boyle
Business analyst: Terry Knope
Finance manager: Piter Blunt
Designers: Mark Wild, Lucy Dale
QA team: Tamara Jonas, Natasha Potter
Developers: Philip Levison, Simon Nowicki, Maria Barres
|Success measurements||– The app has at least 5,000 downloads on Google Play and App Store in the first month.|
– The app has 4–5 stars on Google Play and App Store and more than fifteen positive reviews on each platform in the first two months after launching.
|Project approval||CEO: Peter Drake|
Investor: Mark Johansson
Sponsor: James Jones
Project manager: Marry Stark
Finance manager: Piter Blunt
Date of approval: 04.03.2022.
Let’s now see how you can prepare your own project charter.
How do you build a project charter?
There is no universally accepted procedure on how to build a project charter. But, we have selected some tips that can come in handy:
- Discuss the charter with your team,
- Keep it short and simple,
- Include all vital information,
- Use a template, and
- Present the project charter to relevant parties and secure approval.
Let’s explain each step.
Discuss the project charter with your team
No one expects the project manager to be Superman. A team is always stronger than just one person as everyone brings their experience and specific knowledge to the table.
So, join your forces and ask your team members for their opinion about the project.
Discuss project goals, milestones, and risks with your team.
Insights from your team members can help you not miss anything crucial and create a more accurate project charter.
After all, the more precise the project charter is, the better chances are that the stakeholders will approve it.
Keep your project charter short and simple
A project charter should be on-point — clear, and concise. You don’t have to beat “Remembrance of Things Past”, the book by French author Marcel Proust, holding the Guinness record for the longest novel ever written.
Now, long novels are completely fine — in most cases, even preferable, as an author can describe the atmosphere better by using more words.
However, you want to sell your project, not annoy key stakeholders with unnecessary details which may contribute to them giving up on your project.
Sure, with other planning documents — such as project plans — feel free to go into more detail. But, each project charter section should only be a sentence or two long.
Include all vital information in your project charter
As we mentioned previously, there is no universal list of elements we can apply to all project charters.
However, it is vital to:
- Include what you want to achieve with a particular project,
- State the known risks and project constraints, and
- Identify stakeholders and team members.
Use the list of the most common project charter elements we provided in this guide to help you include everything of importance.
Use a project charter template
Remember — no one enjoys reading a wall of text.
So, apart from making sure your project charter is not overly long, ensure you make it visually appealing to people who must read it and decide on its approval — you can achieve this via proper structuring and formatting.
Separate the sections of your charter using tables, to make your document easier to scan and digest.
We suggest using a project charter template.
Don’t worry — you don’t have to lose your precious time creating such a template.
We have prepared an easy-to-use project charter template you can edit and download for free.
🔽 Download project charter template
If you prefer to print and fill out the project charter template manually, we’ve also prepared a print-friendly version.
🔽 Download project charter template for printing
Present your project charter to relevant parties and secure approval
You want your project to get approval, don’t you?
Then make more effort than just emailing your project charter to key stakeholders as a PDF. Instead, organize a presentation, book a meeting, and explain what you intended to achieve with a particular project — you can also use this time to answer the stakeholders’ questions and ease their concerns, if any.
Wrapping up: Secure your project’s approval by preparing a great project charter
A project charter acts like your sales pitch — so make sure you do your best to prepare it in order to “sell” your project.
The elements of a project charter vary, but we listed the most common ones you shouldn’t omit.
In the end, follow our advice and use our project charter template to help stakeholders buy your idea and bring your project to life.
- Bloomenthal, A. (2021, July 24). Deliverables. Investopedia. Retrieved March 4, 2022, from https://www.investopedia.com/terms/d/deliverables.asp
- Guinness World Records. (n.d.). Longest novel. Retrieved March 2, 2022, from https://www.guinnessworldrecords.com/world-records/longest-novel
- Kojic, M. (2021, December 21). How to set SMART goals (+ examples and templates). Clockify Blog. Retrieved February 25, 2022, from https://clockify.me/blog/productivity/smart-goals/
- Maggio, A. (2021, July 26). Project Charter vs. Project Plan: 4 Clear Differences. ICTShore.Com. Retrieved February 25, 2022, from https://www.ictshore.com/project-management/project-charter-vs-project-plan/
- Maggio, A. (2021, July 29). Project Charter vs Business Case (with Clear Differences). ICTShore.Com. Retrieved February 25, 2022, from https://www.ictshore.com/project-management/project-charter-vs-business-case/
- Project-Management.com. (2022, March 2). What Is A Project Charter? Retrieved March 3, 2022, from https://project-management.com/what-is-a-project-charter/#contain
- Simplilearn. (2022, February 7). What is a Project Charter and Why Do You Need One. Simplilearn.Com. Retrieved February 25, 2022, from https://www.simplilearn.com/project-charter-and-its-importance-article
- Simplilearn. (2021, August 1). Two Major Documents of Project Management – Project Charter and Project Scope. Simplilearn.Com. Retrieved February 25, 2022, from https://www.simplilearn.com/project-management-documents-project-charter-and-project-scope-article