Developing a project charter is the first thing to do in a project, during the initiating process phase. A project charter is a document issued by the project initiator or sponsor that formally authorizes the existence of a project and provides the project manager with the authority to apply organizational resources to project activities.
Project charters provide many benefits. They allow an organization to formally authorize a project, establish the authority of the project manager and project sponsor, ensure projects are approved based on the business case, ensure a better return on investment, align projects with the company's strategic plan, provide information for team orientation and project kickoff meetings, bring new team members up to speed, and help non-profits create grant proposals.
For agile projects, a charter is also beneficial in reducing risk and improving communication. It is a document that should be developed with the involvement of key stakeholders to minimize conflicts early on. The primary goal of the project charter development process is to create the project charter and assumption log, which record high level strategic and operational assumptions and constraints. Lower level activity and task assumptions are generated throughout the project and recorded in the assumption log. Inputs to this process include business documents, agreements, enterprise environmental factors, and organizational process assets. Tools and techniques such as expert judgment, data gathering (brainstorming, focus groups, interviews), and interpersonal and team skills (conflict management, facilitation, meeting management) are used to process these inputs and achieve the desired project outcomes.
Overall, developing a project charter is an essential step in project management, providing authorization, direction, and clarity to the project team.
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