HKSM

A project charter is the formal authorization to start a project and to assign authority to the project manager to use organizational resources. It summarizes the purpose, outcomes, boundaries, and key stakeholders at a high level.

Key Points

• Formally authorizes the project and the project manager's authority to apply resources.
• Connects the project to strategic goals and the business case or need.
• States high-level scope, objectives, success criteria, assumptions, and constraints.
• Highlights major risks, milestone schedule, and an initial budget range.
• Identifies the sponsor and key stakeholders and clarifies approval requirements.
• Serves as a governance gate; updates require formal change control.

Purpose

The charter aligns decision makers on why the project exists, what it is expected to achieve, and who has authority. It enables commitment of funds and resources and sets boundaries for further planning.

Who Approves

• Project sponsor who provides funding and champions the initiative.
• Steering committee or governance board for larger or high-risk efforts.
• Portfolio or program management when the project is part of a broader investment.
• Customer or buyer representative in external or contract projects.

How to Prepare

• Confirm the problem or opportunity and reference the business case or mandate.
• Draft clear objectives and measurable success criteria aligned to strategy.
• Outline high-level scope, key deliverables, and out-of-scope items.
• Summarize major risks, assumptions, dependencies, and constraints.
• Propose a milestone-level schedule and an initial budget or funding band.
• Name the sponsor, proposed project manager, and key stakeholders.
• State the project manager's authority, decision rights, and reporting lines.
• Define approval requirements, governance checkpoints, and change control for the charter.

How to Use

• Communicate the project's intent and boundaries to stakeholders.
• Guide detailed planning and scope definition while preventing scope creep.
• Support decisions on priorities, trade-offs, and resource allocation.
• Serve as a baseline for measuring alignment and continued viability.
• Escalate conflicts by referencing the stated objectives, authority, and approval rules.

Gate Checklist Example

• Business need and value proposition stated and agreed.
• Objectives and measurable success criteria documented.
• High-level scope, major deliverables, and boundaries defined.
• Initial risks, assumptions, dependencies, and constraints listed.
• Milestone schedule and budget range proposed.
• Sponsor identified and project manager named with defined authority.
• Governance approach, approval requirements, and next gate defined.
• Stakeholder list and communication expectations outlined.

Governance Rules

• The project cannot consume organizational resources until the charter is approved.
• Only the sponsor or designated governance body may approve or change the charter.
• Any charter change follows formal change control with documented impact analysis.
• Authority and decision rights granted to the project manager are respected across functions.
• Periodic reviews confirm the project still aligns with strategy and remains viable.
• Closure or termination requires documenting outcomes against charter objectives.

PMP Example Question

A new project is being considered. Which document should the sponsor approve to formally authorize the project and grant the project manager authority to apply resources?

1. Project management plan
2. Project charter
3. Stakeholder register
4. Requirements documentation

Correct Answer: B — Project charter.

Explanation: The charter authorizes the project and grants the project manager authority to use resources. The other documents are developed after authorization.