The project charter is the foundation on which the success of a project depends. It must be complete and made as a formal document. All of the initial conceptual planning that triggers an initiative is expected to be taken as the key input.

Project initiation being the early stage, the project contributors/participants suggested in the earlier section must brainstorm, innovate, and commit in this formal document.

Following are the salient features of a project charter:

• It should clearly articulate and describe the project objectives in a Specific, Measurable, Achievable, Repeatable, and Time-bound (SMART) format.
• It should form a solid agreement between the sponsors and the project management team.
• This formal document should give the project manager the authority to manage the project.
• It should define the types of resources that will be needed across project activities.
• It should empower the OCM lead to drive the business process changes.
• This document should be able to give a top-level view of the initiative in focus and list all projects that are expected to be spun out of it.
• A project charter should define the high-level scope of the initiative.
• All critical success factors of accomplishing the goals must be called out, including the key milestones and target dates.
• This document is typically prepared by the project sponsors, along with the stakeholders involved in delivering the project.
• In a project charter, we must define a rough order-of-magnitude estimate for completing the project with some buffer as agreed with project stakeholders.
• It must mention the approved funding for the project and contingencies, if any.
• The selection of the project delivery process, that is, methodology, assumptions, constraints, known risks, and identified issues, along with the other key elements, must be suggested as guidelines of the project charter.

Often, a project initiation document is used along with a project charter to act as a level between the project charter and the project plan.

In larger initiatives, a project scope document is also prepared, which lays down the exact description of requirements and deliverables. This formal requirement document, scoped for an initiative along with the project charter, forms the basis for developing a project plan.