Focused female creating project charter

Why are project charters important and how to build a project charter


Project Summary

A project charter is an essential document for any successful project. It provides a clear statement of the project's goals, scope, and objectives and serves as an agreement between all stakeholders on what needs to be accomplished. A well-crafted charter should provide direction for both the team members and those outside the team who are affected by or otherwise involved in the project. The development of a project charter ensures that everyone involved has a shared understanding of why they're working together and how their efforts will contribute to achieving desired outcomes. Building a good one requires careful planning, consideration of various perspectives from key stakeholders, and thoughtful communication throughout its creation process.

If you’re a project manager or just managing a project, then one crucial document should be part of your toolkit: the Project Charter.

A project charter will help ensure that everyone involved in the project—from stakeholders and team members to executives—is on the same page right from the start regarding understanding the project objectives and guiding parameters.

With a handshake-style agreement finalised at kickoff, this vital document keeps all individuals accountable while providing clear direction and feasible constraints during development. Building an effective charter requires input from multiple parties but can be worth its weight in gold when done correctly to ensure all key stakeholders, project sponsors and project team members are all on the same page.

Within Lean Six Sigma, the project charter is the last step in the project Define stage. It explains what is known and not known about the project, and details key success criteria, project risks, project schedule, project costs and key deliverables. The project charter aligns the project manager, project sponsor, and key project stakeholders on the overall project plan. So let’s take a deep dive into the Project Charter.

A Project Charter is a record of what is known and planned about a selected project.


What is a Project Charter, and why is it important


A project charter is an important formal document that includes a project’s scope, objectives, and milestones. It helps keep all stakeholders aligned with critical information such as project purpose, vision, goals, roles and responsibilities, timeline, budget and other relevant data.

The project charter is the ultimate reference guide for project planning, helping to keep any team or individual working on a project with a shared understanding. The project charter document is valuable because it provides an idea of the project’s future state and how it will get there from its current state.

A project charter ensures that everyone involved is on the same page regarding end goals and responsibilities by establishing a clear set of expectations from the start.

The project charter is not a static document. When we create a project charter at the beginning of the project, it documents the project vision, the key project risks, and the overall project life cycle based on the information we have today. But as projects develop, the project charter needs to be changed as key milestones and critical project information change. A project charter is, therefore, a living document.

The purpose of a project charter


Within Lean Six Sigma, the Project Charter is a document which provides the formal agreement between the business and appropriate stakeholders and the Project Manager.

The purpose of a project charter is to document the purpose and direction of a project, define the roles and responsibilities of team members, and set expectations for project deliverables, including the business case justification for doing the project in the first instance.

It’s an essential tool for successful project management as it helps organize projects, keep them on track and make sure everyone involved is on the same page from start to finish. When written succinctly and adopted by all stakeholders, a well-crafted project charter can save time and money while allowing project managers to assess quickly how resources are best utilised given the tasks at hand. A Project charter enables accountability by clarifying each team member’s contributions and setting realistic objectives that can be tracked throughout development. With it, you can confidently align yourself with your goals towards delivering an effective result!

Key elements to include in your project charter


Crafting an effective project charter is essential to project success. It defines the project scope and objectives and sets the stage for how a project should run. Crucial project charter elements are project scope and deliverables, team roles and responsibilities, project timeline, approval processes, project tracking methods, communication plan, and assumptions.

To create a successful project charter, you must ensure clarity on all of these elements by having agreement from stakeholders. As you build out your project charter, consider engaging experts to ensure each element is considered to have appropriate documentation that encompasses the breadth of your project needs. Doing so will help ensure success across any project’s life cycle!

Steps to build a project charter


Crafting a comprehensive project charter is the crucial first step for any successful endeavour, but how exactly do you go about it?

A Project Charter should include the following elements:

A typical project charter will contain

Business Case – how does it impact the strategic business objectives

Problem Statement – specific and measurable
Scope – What is in and out of scope!
Benefits – a brief description of the anticipated benefits
Milestones – core milestones and deliverables
Risk – A short list of any risks to the project
Project Plan – High-level key steps, timeline, tollgates
Stakeholders – details the list of key stakeholders


Once you know why you are doing the project and what the exact problem is, you need to define the scope of your project and align on the project objectives. Led by the project manager, this will provide a vision of how each stakeholder’s role and responsibilities are necessary to complete tasks throughout the project lifecycle.

Your objectives or benefits should follow suit, honing in on specifics that must be achieved for the project to succeed. The expectations on these objectives should also be clarified to obtain sign-off from necessary stakeholders on evaluating them.

A risk analysis is key in crafting an effective charter; evaluate possible mitigation strategies to prepare for unforeseeable scenarios or issues that may arise during execution activities.

Finally, showing what will be done and when it is done through a high-level project charter is key.

By following these steps, how to write a project charter can become a seamless process resulting in a well-thought-out plan of action.

How is the Project Charter used in Six Sigma?


A Project Charter is a crucial document for success and is critical within the Lean Six Sigma project approach.

A Project Charter is essential for success and is critical within the Lean Six Sigma project approach. It clearly explains the project’s parameters, scope, project objectives, and deliverables while setting out roles and responsibilities. It also helps to ensure the stakeholders’ expectations are well defined, thus providing accountability throughout the project’s life cycle.

At the end of the define stage, when all the relevant elements and project background information has been gathered, the project charter is presented to the key stakeholder and Project Champion for sign-off. This sign-off gives the green light from the business to proceed with the project. Without this green light and project charter sign-off, no project should proceed.

Project Charter Template


Many project template variations range between word, excel, power templates or some via project management software, but the core elements remain the same.

As part of our Lean Six Sigma Training, we provide candidates with a Project Charter example that can be tailored based on the project charter templates used within their existing business.

So if you want to create a project charter or build reviewing a project management charter, you can download our project charter template to get some guidance and tailor it for your business.


Benefits of having a comprehensive and well-written project charter


Project charters offer numerous benefits to the project and its team members, such as increased alignment and focus on deliverables, improved communication, improved resource management, aligned project objectives and an established framework for decision-making.

Project charters provide a comprehensive view of the project’s goals, strategies, timeline and resources to complete the project successfully. Therefore, building a comprehensive and well-written project charter is essential for any successful project as it lays a strong foundation for the team’s success throughout the process.

Project Charter Summary


A project charter sets up the groundwork for any project and is essential for tracking progress, managing resources, aligning project stakeholders and producing results. You’ve learned what a project charter is and why it’s important, including key elements in your charter, steps to build a high-quality project charter and mistakes to avoid.

Investing time into creating a comprehensive and well-written project charter will yield tremendous rewards by keeping everyone on the same page throughout the process.

To help you make an excellent project charter, download our project charter template example sample now so you can get your team off to a flying start. Get ready to kick off your successful projects with an excellent Project Charter!

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Reagan Pannell

Reagan Pannell

Reagan Pannell is a highly accomplished professional with 15 years of experience in building lean management programs for corporate companies. With his expertise in strategy execution, he has established himself as a trusted advisor for numerous organisations seeking to improve their operational efficiency.

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