Develop Project Charter

This process is one of the first performed. The project will not become official if you don’t have a charter. This document specifies the project manager assigned to the project and his level of authority.

Inputs

• Contract (where applicable). Not all projects are performed under contract but if the contract exists it will surely be signed before the project begins.
• Project Statement of Work. The Statement of Work (SOW) is a description of the product or service being produced by the project. The SOW lists all of the deliverables of the project.
• Enterprise Environmental Factors
• Organizational Process Assets

Tools

• Expert Judgment
• Project Management Methodology
• Project Management Information System
• Project Selection Methods

Outputs

• Project Charter

Once an organization has selected a project the charter must be created.

The Project Charter

The charter is the only output of the Develop Project Charter process. It is created on a business need or a customer request. The contents of a charter are the following:

• Brief description of the project
• Name of the project manager assigned
• Very high level project requirements
• Very high level milestone schedule
• Assumptions & constraints. It will include a preliminary budget.
• Business case. It will explain the reason why your organization decided to choose this project over another.

The document should be signed by senior management who has the required authority within your organization to assign you to the project.

The charter is a high-level document that does not include project details. The specifics of a project will be developed during the planning process.

Project Selection Methods

Project Selection Methods are used to select and prioritize projects within the organization. Selection Methods will let you know if the project is too risky or if it won’t make enough money, it it’s strategic or isn’t likely to succeed.

The PMBOK Guide defines 2 categories of Project Selection Methods:

Benefit measurement models compare projects by the benefit they bring to the company. Comparative approaches include methods such as Return on Investment (ROI) or Benefit Cost Ratio (BCR).

Mathematical models use complex mathematical formulas that attempt to predict the project’s success. Some of these methods apply calculus and linear programming to solve for maximizations. These methods are also known as constrained optimization.