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Project Charter

A high-level authorization document issued by the sponsor that formally starts the Scrum project, names key roles, and sets boundaries such as objectives, budget, schedule, and constraints. In SBOK-aligned Scrum, it is an upstream output from governance and a primary input to Initiate processes like creating the Project Vision and forming the Scrum Team.

Key Points

  • Authorizes the project and empowers the Product Owner and Scrum Master to mobilize resources.
  • Summarizes business need, high-level scope, success criteria, budget, schedule, and key risks.
  • Identifies sponsor, Product Owner, Scrum Master, and major stakeholders.
  • Acts as an input to SBOK Initiate processes, guiding the Project Vision Statement and epics.
  • Provides governance guardrails while allowing product scope to evolve through backlog refinement.
  • Typically concise and stable; updates require sponsor approval when constraints or objectives change.

Purpose

The Project Charter aligns leadership on why the initiative exists and what boundaries apply. It formally authorizes funding and decision rights so the Scrum Team can be formed and start discovery and delivery work.

It also creates a baseline for success criteria and constraints that guide release planning and stakeholder expectations across the project.

Key Terms & Clauses

  • Business need and objectives - the problem or opportunity and measurable outcomes.
  • High-level scope and out-of-scope - boundaries that frame the product direction.
  • Success criteria - SMART measures such as adoption, NPS, revenue, or cycle time.
  • Budget and schedule guardrails - funding cap, release horizon, or target date windows.
  • Risks, assumptions, and constraints - known uncertainties and limits to respect.
  • Governance and decision rights - sponsor, escalation path, change authority.
  • Key roles - named sponsor, Product Owner, Scrum Master, and core stakeholder groups.
  • Authorization and approvals - signatures or formal approvals to proceed.

How to Develop/Evaluate

Development steps:

  • Gather inputs: business case, program vision, market analysis, feasibility, compliance needs.
  • Draft with sponsor and PMO; collaborate with Product Owner, consult Scrum Master and key stakeholders.
  • Define objectives and success metrics; capture constraints, budget, schedule, and governance.
  • Review for clarity and feasibility; secure sponsor approval and communicate to the organization.

Evaluation checklist:

  • Objectives are measurable and aligned to strategy.
  • Budget and time guardrails match ambition and risk profile.
  • Roles, decision rights, and escalation paths are unambiguous.
  • Initial risks and assumptions are recorded with owners.
  • Scope boundaries are clear enough to guide epics, yet not overly prescriptive.

How to Use

During Initiate, use the charter to inform the Project Vision Statement, identify stakeholders, and form the Scrum Team. It guides the Product Owner in shaping epics and early prioritization for the Product Backlog.

During delivery, reference it when negotiating trade-offs, resolving impediments that affect constraints, and aligning sprint and release goals with success criteria. If constraints or objectives must change, escalate to the sponsor and update the charter before adjusting plans.

Example Snippet

  • Title: Customer Self-Service Modernization.
  • Sponsor: A. Lee; Product Owner: R. Gomez; Scrum Master: T. Shah.
  • Business Need: Reduce support costs and improve customer satisfaction.
  • Objectives: Cut call volume by 25% and raise CSAT to 4.4 within 2 releases.
  • High-Level Scope: Web and mobile self-service flows; Out-of-Scope: IVR replacement.
  • Budget: USD 1.2M; Schedule Guardrail: 2 releases in 9 months.
  • Success Criteria: Adoption rate 60%, CSAT 4.4, call reduction 25%.
  • Key Risks: Legacy API latency; compliance approvals.
  • Governance: Monthly sponsor review; change authority with sponsor.
  • Approvals: Sponsor and PMO sign-off dated YYYY-MM-DD.

Risks & Tips

  • Risk: Overly detailed charter can lock scope and hinder empirical discovery.
  • Risk: Missing decision rights leads to delays and unresolved impediments.
  • Risk: Vague success criteria make release decisions subjective.
  • Tip: Keep it short and outcome-focused; let the Product Backlog carry detail.
  • Tip: Use SMART metrics and trace them to epics and release goals.
  • Tip: Reconfirm assumptions at each release boundary and adjust with sponsor approval as needed.

PMP/SCRUM Example Question

A company is starting a new Scrum initiative. Which artifact formally authorizes the work, names key roles, and sets high-level constraints that guide the creation of the Project Vision and initial epics?

  1. Project Vision Statement
  2. Product Backlog
  3. Project Charter
  4. Sprint Goal

Correct Answer: C — Project Charter

Explanation: The charter authorizes the project, names roles, and sets boundaries, serving as an input to Initiate processes. The vision, backlog, and sprint goal are created after authorization.

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