Charting into new P3 Territory with a Project Charter
A project charter is the practical document that showcases where you are going. Once a scope is defined a plan must be set. Like any good captain navigating your ship you require a map. The map needs to inform you of pitfalls, opportunities to provision and key markers before barren wastelands. The function of the project charter cannot be underestimated. Previously we included the basic framework of a project charter. These components are for
Project Managers to rely upon business case studies.
The most important feature of a Project Charter is its identity as a step by step guide to accomplish project tasks.
Project Charters are not research papers. Feasibility studies, environmental impact studies and engineering reports are focused research papers. These items discuss theory and applicability to your project. Project Charters make sense of theory and put the knowledge into action.
A good Project Charter contains two parts.
Project Governance Part 1
The Project Governance gives the background of the project. The background discusses the situation. Project Governance will also include the purpose, objectives, scope of activities and discuss the Project Management Strategy. Project Governance should also cover an organizational chart of the Project Team. The Project Governance lastly addresses the Stakeholders in a Project.
1. Purpose - The Purpose is a concise summary that states why the project exist. It is important to offer the business case study, detail the framework of its accomplishments and annotate the impacts on stakeholders.
2. Objectives - Objectives are clear accomplishments the project will accomplish. Frameworks need clarity, measurable impact, concise explanation and obvious benefit.
3. Scope of Activities - No project can be undertaken without specifically outlining tasks. The scope of activities summarizes the Work Breakdown Structure (WBS) to show everyone what you exactly do. This is a key feature that separates novice from expert. Failure to know sequential steps means you do not have proper knowledge for your project.
4. Project Management Strategy - is a structured framework of change controls, approvals, budget committees, permit processes and regulatory procedures. The section is not for theory, assumptions or philosophy. Remember the purpose of a Project Charter is to obtain a sign off from a stakeholder not obtain a grade from a teacher.
5. Project Governance - Organizational Charts, Stakeholder Analysis and methods of engagement should be organized into a web with corresponding: Who, What, When, Why, How, Role methodology. Bar organization with columns are good to show relationships. The goal of Project Governance is to summarize interactions in paragraph format but not detail a research paper. Concise explanations are required.
Project Management Part 2
The Project Management portion of the Project Charter details the Project Schedule, Project Costs, Financial Analysis and details Quality Control. Quality Control will also annotate Performance Metrics. Risk Assessment is included (as detailed above) along with a sound Communication Plan. Communication Plans are: Who, How, What, Why, Purpose, Role, et cetera. Support Plans are formal studies relied upon that incorporate related plans and third party documents. Assumptions are always detailed along with the Terms & Conditions of Engagement.
1. Project Schedule - No project can start without knowing schedule. Time lines should be broken down into appropriate intervals (days for 30 day or less projects), weeks (for over 30 days but less than 9 months), and months (for over 9 months). Yearly schedules should never be adopted. Feature percentage completion markers and bars that are styled in Gannt Chart Format.
2. Project Costs - Detail an itemized cost analysis by activity, component, material, personnel and track each one as a parameter. Separate by project phase and detail each phase to the project life cycle (initiation, planning, execution, monitoring & control and closing).
3. Financial Analysis - Conduct a cost benefit analysis in simple format. Show how much value gained for dollar spent. Annotate the impact as a bottom line. Detail the improvement values, the cost reductions to the organization and if possible tangible asset value. Businesses require justification for dollars spent. Your project must reduce costs, improve profitability or increase asset value. Without a comprehensive concise explanation your project will not be funded its budget.
4. Quality Control - Change control process, approval for next steps, and internal auditing show competence. You must detail how you plan to check your work quality. Failure to obtain approvals, construct to code or follow entitlement plans results in failure. Failure can impact cost and time. Cost and time will determine success or failure for your project scope. Focus on review processes, completion standards, and sign offs. Accountability is the number one focus of this category.
5. Risk Assessment - is organized into a frame work chart that features risks from high to low and impact from high to low. List each potential risk. Discuss what the risk is in detail and then assign it a number. Place the number in a box. The box should be categorized. Low impact to high impact makes up one direction (horizontal or vertical). Low probability to high probability makes up another direction (horizontal or vertical). Depending on intersection you either: 1) accept, 2) mitigate, 3) transfer, 4) insure against loss/occurrence. Showcase your ability to deal with catastrophe up front. Project Sponsors require comfort that your planning is thorough.
6. Communication Plan - is a registry of all person related. The Communication Plan should annotate all stakeholders, corporate members and third parties. The Communication Plan discusses frequency, medium, purpose, conventional role, contact information, notes on project role, department and position within the project. Include all parties so anyone who needs a reference guide for any subject area can locate the proper person.
7. Support Plans - are third party engineering studies, impact studies, feasibility studies or other third party plans that support your Project Charter. This is an opportunity to substantiate your work (if required).
8. Assumptions - This is an important area often overlooked. Not everything can be predicted up front. You need to clearly identify your assumptions. You may need to assume a regulatory will not change its rules next year when your project starts in September. Make sure you clearly identify components that you cannot control. Anything outside of your influence should be listed as an Assumption. Assumptions are your opportunity to point out that you cannot control certain things. If you do not disclose it you will be held personal liable. Make sure you take great care in going over this section.
9. Terms & Conditions - These are the contractual items you agree to be bound to. Explain your liability, coverage (Knight Advisory is limited up to 1mm USD Per Occurrence 2mm USD Aggregate for instance additional amounts are added on per project basis), terms of engagement, and have legal provisions that are contractual. Make sure you employ the use of an attorney to incorporate a contract schedule to hedge your potential losses. Never author a project charter without Error's & Omission Insurance. One law suit can sink your company if you lack liquidity to cover damages.
Appendices
A Work Breakdown Structure (WBS) and Gannt Chart should always be included. Without this key component it is impossible to track your project. If possible a financial analysis should be conducted showcasing the value increase for every step of completion. Parametric tracking is useful and will justify cost.
As we detail in this article a Project Charter is the backbone of demonstrating your knowledge. As a Project Manager you need to showcase mastery, application of theory and sound accountability. This is your one shot before being entrusted to run a project to showcase your competency. This is the most important step. Don't ruin it by guessing how to do it. You can click "Services" to hit the submission button for your project charter today. You don't need to chart your charter alone. Knight Advisory & Planning is here to help.
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Knight Advisory & Planning (KAP) is the only company to primarily focus on Public Private Partnerships (P3) since 2006. KAP operations are spread across countries of the world to serve this need. KAP Network consists of core partners surrounded by interlocking networks of consultants and affiliates in key trading countries and disciplines. We maintain Master Project Manager (MPM) who are American Academy of Project Management (AAPM) certified and are experienced in the following industries: construction, development, finance, technology, FinTech, biotechnology, production, R&D, and manufacturing. With over twenty (20) years of experience let us guide you through the P3 process.