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Project Charter

5 minutes 5 Questions

The Project Charter is a formal document that authorizes the existence of a project and provides the project manager authority to allocate resources. It gives the high-level project goals, objectives, and stakeholders. The project charter is usually created by the project sponsor or initiator and addresses the project's purpose, measurable objectives, high-level requirements, and the project manager's authority. It is essential to establish consensus among stakeholders, communicate expectations, and provide a basis for decision-making.

Guide to the Project Charter as per the PMBOK Guide Seventh Edition

The Project Charter is an essential document that formally authorizes a project, giving the project manager the authority to proceed and use organizational resources.

The Importance:

It is crucial because it documents the business needs and the customer's requirements. It aligns the project with strategic goals of the organization, defines the project boundaries, and provides a direct link between the project and the strategic objectives.

What it is:

The Project Charter is a document that outlines your project’s objectives, scope, deliverables, milestones, team members, and other vital project information. It includes the project’s purpose, measurable project objectives, high-level requirements, project description, project boundaries, key deliverables, project timeline, project budget, stakeholders, and assigned project manager.

How it works:

The Project Charter gives a clear direction for the project, and through the signature of the sponsor, the project manager is given the authority to apply organizational resources to project activities.

Exam Tips: Answering Questions on Project Charter

Here are some essential tips to answer project charter related questions in the exam: Understand that the Project Charter authorizes the project and is issued by a manager external to the project. Know that the project manager is formally assigned through the project charter. Be aware of the information included in the project charter. Understand that if a project manager detects a discrepancy or missing detail in the project charter, he/she should ask for a revision or clarification.

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Question 1

During the initiation phase of a project, the project manager is reviewing the Project Charter with stakeholders. The Project Charter is a document that provides authorization to start a project, outlining the project objectives, scope, and stakeholders involved. It is crucial for setting the foundation for the project and ensuring alignment with business goals. Which of the following is NOT a key component typically included in a Project Charter?

Correct Answer: Detailed project schedule

The correct answer is 'Detailed project schedule'. A detailed project schedule is not typically included in the Project Charter as it is more detailed planning that comes in later phases of the project. The Project Charter focuses on high-level information such as project objectives, scope, and stakeholders involved to provide authorization and set the foundation for the project.

Question 2

You are managing a project to transition an organization's manual record keeping to a digital system. A crucial stakeholder insists on including a feature that will significantly impact the budget but this was not part of the initial project charter. How should you address this new requirement?

Correct Answer: Analyze the impact of the new feature request and, if approved by the key stakeholders, update the project charter accordingly.

The best approach when managing changes in any project, especially those that impact budget and scope, as a project manager, is to analyze the impact of the request. This includes its benefits, impact on the budget, timeline, resources, and so on. Even though the request wasn't part of the initial project charter, ignoring the stakeholder's request (second answer) would not be efficient stakeholder management, as their interests and inputs are quite vital for the success of a project. Also, while it is true that the original project charter is a key document in the project, saying that it can't be changed (fourth answer) is not completely accurate. Changes can be made, but they have to go through a formal change control process. This usually involves analyzing the impact of the change, reviewing it with key stakeholders and, if approved, updating the project charter and other affected documents. Therefore, the first answer is the correct one. Implementing the change directly (third answer) without discussion or updating the project charter could lead to scope creep, and it would not be managing the project effectively, as it could lead to more detrimental changes down the line.

Question 3

As a new project manager assigned to an ongoing project, you realize that the project has no formal project charter. What should be your first step?

Correct Answer: Develop and get approval for a project charter

The best course of action for a project manager assigned to an ongoing project that lacks a project charter is to 'Develop and get approval for a project charter'. The project charter serves as a foundational document in the scope management process. It provides a preliminary delineation of roles and responsibilities, identifies the stakeholders, sets the project's objectives, and establishes the authority of the project manager. In essence, it serves as the project manager's mandate for the project. This is why it is vital to develop and get approval for a project charter even in an ongoing project. 'Continuing without a project charter' is not an advisable approach because it could lead to confusion, miscommunication, and lack of clear direction. 'Creating a project charter with your preferred assumptions' is risky and incorrect because a project charter to be effective must be validated and approved by stakeholders to ensure alignment with organizational objectives and stakeholder expectations. 'Notifying stakeholders of the project's termination' is an extreme step and should be considered only when the project is deemed as no longer viable or if it's necessitated by an exceptional circumstance.

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