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In project management, a key responsibility is guiding decision-making. Even if you aren’t the one making the final decisions, you need to track every new decision and use them to create a plan.

Importance of Clear Documentation

Clear and consistent documentation is crucial for transparency and effective communication. It helps set the stage for the project by answering essential questions:

  • Problem Statement: What problem are you trying to solve?
  • Project Goals: What are the project goals?
  • Scope and Deliverables: What are the scope and deliverables, and who are the stakeholders?
  • Resource Requirements: What resources does the team need to complete their work?

Documentation also preserves early decisions and serves as a reference for new team members. Ensure this information is easily accessible through formal documentation like emails, presentations, or digital documents. Documenting decisions can also uncover tasks, timelines, or costs you hadn’t previously considered, providing a historical record for future reference and lessons learned.

Project Proposal

A project proposal is created at the very beginning to persuade stakeholders that a project should start. Typically, a senior organizational leader creates this document. It helps to understand the desired goals and impact and can be a formal document, a presentation, or even a simple email.

Project Charter

The project charter is a formal document that defines the project and outlines the necessary details to achieve its goals. It helps you get organized, establish a framework, and communicate those details to others. It ensures that the benefits outweigh the costs and that you and your stakeholders agree on the project details.

The charter is tailored to its audience, whether a marketing executive, a chief technology officer, or another stakeholder. It is a living document that evolves with the project, capturing goals, values, benefits, and details. Developing the charter in collaboration with stakeholders ensures it addresses their concerns and keeps the team aligned.

Key Information in a Project Charter

A project charter typically includes the following information:

  • Introduction/Project Summary
  • Goals/Objectives
  • Business Case/Benefits and Costs
  • Project Team
  • Scope
  • Success Criteria
  • Major Requirements or Key Deliverables
  • Budget
  • Schedule/Timeline or Milestones
  • Constraints and Assumptions
  • Risks
  • OKRs (Objectives and Key Results)
  • Approvals

Regularly review and update the charter to keep it aligned with the project’s progress.

Difference Between Project Proposal and Project Charter

The project proposal is created early in the initiation phase to persuade the company to start the project. The project charter, developed later in the initiation phase, defines the key details of the project and serves as a reference throughout its life.

Cost-Benefit Analysis in the Project Charter

Include answers to these questions to perform a cost-benefit analysis:

  • Value Creation: What value will this project create?
  • Cost Savings: How much money could this project save the organization?
  • Time Investment: How much time will people need to spend on this project?

The benefits should always outweigh the costs.

Creating a Project Charter

Here’s a step-by-step guide to creating a project charter:

  1. Write an Executive Summary: Summarize the project’s purpose and desired outcomes in 1-3 sentences.
  2. Define the Project Goal: Record the main project goal, making it SMART (Specific, Measurable, Attainable, Relevant, Time-bound).
  3. Identify Project Deliverables: List three expected outcomes, which can be tangible or intangible.
  4. Determine the Business Case: Explain the reason for the project and how it supports the company’s success, providing useful background information.
  5. Outline Benefits and Costs: Describe the expected benefits and consider the costs, including time and resources.
  6. Define the Project Scope: Identify the project team members.
  7. Measure Success: List success criteria to determine when the project has reached its goal.

By following these steps, you ensure that your project is well-defined and aligned with organizational objectives.