MIS 578 Chapter 3

Question 1

Project Charter

Answer 1

A project charter is like an informal contract between the project team and the sponsor

Question 2

Why is a project charter used?

Answer 2

The project charter is used to authorize PROJECT MANAGER to proceed, help develop common understanding, help team and sponsor to commit, and screen out poor projects.

Question 3

What is a preliminary scope statement?

Answer 3

It is a more detailed version of scope overview section of the charter

Question 4

Typical elements of a charter

Answer 4

1) Title
2) Scope overview
3) Business case
4) Background
5) Milestone schedule w/ acceptance criteria
6) Risks, assumptions, & constraints
7) Spending approvals or budget estimates
8) communication plan requirements
9) Team operating principles
10) Lessons learned
11) signatures and commitment

Question 5

Title

Answer 5

A meaningful title helps people understand the project quickly.

Question 6

Scope overview

Answer 6

The “what” of the project. The project in a nutshell: what needs to be delivered and what work
is involved in creating it.

This is the “elevator speech” – a half minute summary of the project. Ideally, sponsor provides
rough draft or at least input. Each of these sections should be of one to four sentences.

Question 7

Business Case

Answer 7

The “why” of the project. How the project will benefit the organization – how it supports the
organization’s strategy.

This is the “elevator speech” – a half minute summary of the project. Ideally, sponsor provides
rough draft or at least input. Each of these sections should be of one to four sentences.

Question 8

Background

Answer 8

Optional. More details under business case if needed.

If team wants more detail than four sentences in any of the previous sections, the extra details
can be included in this optional section.

Question 9

Milestone schedule with acceptance criteria

Answer 9

Powerful visual summary of high-level schedule combined with how key stakeholder will
evaluate progress at each point.

Table with four columns one each for milestones, dates, stakeholder (who will judge), and
acceptance criteria can be used. Six-step process includes describing current situation,
describing desired end state, describing end state stakeholder and acceptance criteria,
determining milestones, determining expected completion dates for each milestone, and
identifying stakeholder and acceptance criteria for each milestone.

Question 10

Risk, assumptions, & constraints

Answer 10

Risks are uncertain events, assumptions are factors believed to be true, and constraints are
limitations. Each can influence the project.

This section can vary. At a minimum, brainstorming is done about risks and one risk is noted per
Post-It® Note, determining by group consensus the likelihood and the impact of each risk,
creating contingency plans and assigning ownership for each big risk.

Question 11

Spending approvals or budget estimates

Answer 11

Preliminary project budget or at least pre-approval to cover minor expenses.

Listing any preliminary budget or at least authorization to spend minor amounts of money
without further approval.

Question 12

Communication plan requirements

Answer 12

Table with stakeholders identified along with what each needs to know, when, and the most
effective way for them to receive it.

A five-column table is created listing stakeholders, what the project team needs to learn from
each, what the project team needs to share with each, the timing for each communication, and
the method that will be most effective for the stakeholder to receive and understand it.

Question 13

Team operating principles

Answer 13

Guidelines to enhance team functioning. Often include meetings, decision-making, accomplishing work, and showing respect.

Either existing team principles are discussed or new ones are formulated.

Question 14

Lessons learned

Answer 14

How the current project will be better because of learning on previous project(s).

Useful practices are identified to copy or tailor from previous projects and/or less useful
practices to be avoided.

Question 15

Signaturess and commitment

Answer 15

Public and personal commitment to the project.

Signature blocks are created to be signed after ratifying charter.

Question 16

Ratifying the project charter

Answer 16

Project manager and team present draft charter to sponsor (and sometimes team of executives). After interactive discussion, often leading to adjustments, ideally everyone is satisfied and sponsor, project manager, and core team sign charter. Everyone feels committed to the project.

Question 17

What is a charter?

Answer 17

Informal contract between sponsor and project team (core team and project manager)

Question 18

How is a charter like a contract?

Answer 18

It is an agreement entered into by the two parties through consensus and one of them cannot
arbitrarily change it. It is a living document that can be changed if both parties agree and both
receive something of value. This means that if a sponsor needs to change the terms of the project
such as to make a demand for earlier completion, the sponsor then needs to work with the team to
determine how to accomplish it – not just demand more overtime with no compensation.

Question 19

How is a charter different from a contract?

Answer 19

A charter is different from a contract in that the parties are agreeing to the “spirit” of the project.
The details are not worked out yet, so there is no “fine print” as in many contracts. The schedule,
budget, exact deliverables, etc. may change, but all parties agree to keep working hard to help make
the project successful.

Question 20

What are typical elements in a charter? What is the purpose of each element?

Answer 20

• Scope overview – Determine how big the project will be
• Business case – Why the project is needed
• Background – Optional – if more details are needed
• Milestone Schedule – When each intermediate point needs to be done
• Acceptance criteria – How will the quality of work be judged along the way?
• Risks – Identify what could go wrong and include in planning
• Spending approvals – How much can the project manager spend without further approval?
• Communication plan – Who needs to know what and when?
• Team principles – How will we work together?
• Lessons learned – Let’s learn from the success/failure of other projects
• Signatures – Commitment to the project.

Question 21

List at least three important purposes of a charter?

Answer 21

• Authorize the project manager to proceed.
• Help project manager, team, and sponsor develop common understanding.
• Help project manager, team, and sponsor to commit, and
• Quickly screen out obviously poor projects

Question 22

What are the possible project outcomes that may come from using a charter?

Answer 22

• Teamwork develops.
• Agreement, trust, communication, and commitment develop.
• Project team no longer worries what management will decide.
• Sponsor is less likely to unilaterally change original agreement

Question 23

How long should a typical charter be?

Answer 23

A typical charter is about 2 to 4 pages.

Question 24

The charter signing marks the transition between which two project stages?

Answer 24

From the high-level project initiating into the more detailed project planning stage.

Question 25

The team always writes the charter rough draft. True or false?

Answer 25

False. The team usually writes the rough draft, but an executive team or a sponsor could write the first draft.

Question 26

Charters help secure both formal and informal authority. True or false?

Answer 26

True. The charter is the official form that formally authorizes the project manager to proceed, but it is also good at informally developing commitment.

Question 27

How does the preliminary scope statement compare to a charter?

Answer 27

The preliminary scope statement is basically a more detailed version of scope overview section of
charter. On large projects, both are frequently used. On small projects, often only the charter is used.

Question 28

Each contingency plan should have an “owner” who is responsible. True or false?

Answer 28

True. That helps to ensure it will be accomplished if the risk event happens.

Question 29

Ideally, who should create the first draft of the “elevator speech”?

Answer 29

Ideally the sponsor should create the first draft of the elevator speech. That gives the project team
more guidance for creating the remainder of the charter.

Question 30

What are the four columns of the milestone schedule?

Answer 30

• Milestone,
• Date,
• Stakeholder, and
• Acceptance criteria.

Question 31

On most small to medium sized projects, how many intermediate milestones should be identified in the
charter?

Answer 31

About three to eight.

Question 32

What are the two most frequently used dimensions of risk?

Answer 32

• Probability of occurrence and

* Impact if realized.