What Is a Business Case in a Project Charter

Given these elements, the role of the project manager must go beyond managing a technical development effort. If the main goal of the project is to provide value, the role of the project manager is to ensure that the value is delivered. It is clear that the project manager has no control over many factors that contribute to the successful use of results – for example, the people who define value; or those who will actually work with the results; or those who need to make sure the results work properly. However, the project manager is responsible for ensuring that all parties – especially those who pay for the project, those who need to use the results, and those who do the development work – focus on this expectation. It is common to think that a business case is established and should not change over the course of the project. In fact, virtually any section of the business case can change. Therefore, the sections of the business case should be reviewed regularly (and updated as necessary) so that key stakeholders have up-to-date information to determine the feasibility of the project. Since it is a dynamic document, it is the responsibility of the project manager and the business case owner (usually the project proponent) to regularly monitor these elements to determine whether the project rationale has been reduced in any way (“Should the project be stopped or reduced in scope?”) or improved (“Would it be useful to invest more resources to carry out this project”). The actual cost and time required are not known until the project is completed, when operating and maintenance costs must be taken into account. Similarly, benefits can only be assessed after a certain period of use (as defined in the business case). In short, the project charter and the business case are two essential documents to the existence of a project.

Not all projects require them, but preparation will ensure that projects are better managed by setting the right expectations. In other words, preparing a project charter and business case is a good management practice. Therefore, it is essential that project managers know why the project was chosen and how it relates to the higher business goals. The business case created should justify the existence of the project. Who designs the project charter? Often, it is directly the sponsor who, in the sense of project management, is the person who orders the project. It can be a paying customer or an internal service. Of course, it does not have to be an individual, most likely an organization or department (because in the end, the analysis and consultants will write such documents and the administrators will approve them). • A result is the result of the change that results from the use of the project results Once you understand the basics, you need to estimate the actual amounts and project them into a document or graph. Government Trade Office. (2009).

Managing Successful Projects with PRINCE2 (PRINCE2™) (Fifth Edition). London, UK: The Stationery Office. If the development of a project focuses on its results, the implication is that as long as the project manages what has been requested, it has been successful. Whether and how the results are used is not of particular importance to the project team. This is an extension of the idea that the delivery of a project is primarily a technical process (hence the general assumption that the ideal person to lead a project is the one with the most technical knowledge of the content). Project Charter vs Business Case: What are the differences? What is a project charter and what is a business case? Are these two documents interchangeable? In this guide, you will find all the explanations you need. If you are a project manager, this article is a must. Budget – the estimate of project costs, including information on who can approve expenses, both from the allocated budget. Contains any additional expenses required for the project. The official name of this justification is “Business Case”.

Although the term “business” is used, the concept is equally relevant in non-business environments – governments, non-profit organizations, NGOs, etc. – where it may be known as “case explanation” (or similar terminology). Create a slideshow and present your project charter to the sponsor, client, or stakeholders at a meeting. Give them time to ask questions. It`s a good idea to include team leaders and some team members in the presentation. Here are some presentation tips: • Did something happen in the project or environment that we should have considered? Let`s look at an example of how a business case can affect how the project is managed. A company has identified and selected a particular project because the project complements its strategic plan for consolidating its suppliers. The project manager has a project management plan that includes an approved schedule and resources. The project manager determines that the approved schedule is a constraint that could delay the vendor consolidation process. It requests additional expert resources instead of proceeding with resources approved in accordance with the project management plan.

If the project manager had not requested the increase, the company might have been late in consolidating the suppliers, which would have resulted in the loss, or it might also have happened that the contracts had been renewed. If you are reading this article on project Charter vs. Interesting business case, you are probably thinking about the best way to start and execute a project. The best way to achieve this is to have an in-depth understanding of the concept of net present value. We have a wonderful article that assumes you don`t know anything and takes you far beyond the knowledge of the average project manager. This is something you absolutely need to avoid making bad estimates when creating your business case. 4. No targets shall be set as to the reasons why the results of the project will be produced, other than compliance with the technical specifications. This allows the project team to take too much care of the technical details and lose sight of the project`s objectives.

At the end of the project, there is no clear way to determine whether the project has added value. Both occur because no profit target was set before the project began. .