Project Charter

Introduction
The project charter is a collection of documents that, together, establish the foundation of
an SAP implementation project by defining its dimensions and completion criteria.
Additionally, the charter specifies required project management, control structures, and
other important factors.
The project charter is a collaborative effort between the project manager and the project
sponsor. Together, they define a common problem and solution. The project represents
an agreement on and commitment to the deliverables of the project, as well as the time
constraints, resources, standards, and budget of the project. The project charter is
essential for managing the expectations of the projectu2019s participants.
The charter is a dynamic document that may change throughout the projectu2019s
duration. It includes the following:
Mission statement
Goals and objectives
Scope
Critical success factors
High-level project plan
Organization/staffing requirements
Management responsibility
Resource allocation
Cost/benefit analysis
Risk assessment
The creation of the project charter must be a formal process. For the sponsor, it thereby
becomes a process of project justification and creation of internal support. Once the
charter is ready, it should be reviewed by various groups in the sponsor environment,
including:
Information systems management
User management
The steering committee
However, to the extent possible, all of these groups should participate in the creation of
the charter, so that no surprises arise during final review.
Mission Statement
The mission statement is a concise summary of the purpose and goals of the project.
Mission statements encourage motivation and support within the organization. Business
drivers and objectives should be tightly tied to the scope and approach of an SAP
implementation project. The statement clearly specifies:
The customeru2019s expectations
The teamu2019s primary customers
The teamu2019s plans for meeting or exceeding those expectations
The mission statement should focus on the main thrust of team effort, reflect the
teamu2019s distinctive competence, and allow flexibility (but not so much as to lose
focus), be consistent with the values, beliefs, and philosophy of the organization, and
reflect attainable goals. An effective mission statement can be an important tool for
increasing motivation and solidifying support within the organization.
Goals and Objectives
The Goals and Objectives section is more detailed than the mission statement. In this
initial phase, it is crucial to identify why the project is taking place.
Initially, the project sponsor may not grasp all the problems and opportunities that the
project can address. It is crucial, at this stage, to evaluate and formulate the issues at
hand, and explain how the project can remedy the situation, as specifically as possible.
The projectu2019s success or failure will be judged against the project objectives.
Scope
When identifying the scope of the SAP implementation project, evaluate what internal
and external factors are driving its initiation.
What are the business drivers (for example, competition, customers, government or
regulation, suppliers) for installing SAP?
What is the driving force for moving from the status quo? (People will resist change since
there is comfort in the status quo.)
Who are the right executives to sponsor the SAP implementation? Are they actively
sponsoring the project? If not, how do we get them on board?
What is the strategic significance of the project?
Other questions to ask include:
Where must we excel?
Are we able to innovate, change, and improve to create value?
How do we look to our customers?
Are we looking at our bottom line?
What will success look like from a team/business perspective?
Why does our company need SAP?
The scope is the most important element of the charter. It identifies what the project will
produce, how long it will take to accomplish, and what costs are associated with it. The
project sponsor must be involved in developing the scope, because it requires the
strongest support/buy-in. It is crucial to project development and to the management of
expectations.
Critical Success Factors
Critical success factors are the most significant requisites for successful project
completion. They include the most important assumptions and expectations of
management, user, and project team. Critical success factors identified for the SAP R/3
business system implementation include the following:
The sponsor provides the leadership and functional skills to assume ownership of the
project and responsibility for the deliverables.
SAP provides the required leadership, SAP skills, and Best Business Practices to
complement the project team members.
Open and frequent communication occurs between project management and the steering
committee.
The implementation accommodates the business requirements of all processes defined
in the project scope section.
The project team is motivated, supportive, dedicated, and empowered.
The issue resolution process is streamlined.
The implementation is aggressively scheduled so that the benefits of SAPu2019s R/3
product can be fully realized as soon as possible.
High-Level Project Plan
The project plan establishes how progress is measured as well as controlled. Having a
plan enables the project to continue in a stable manner and produce a controlled
conclusion.
The project plan also coordinates the time required to complete the project. Without such
a plan, the project is useless and delivery dates are meaningless.
Finally, estimates of the time and cost requirements of the project are essential to the
project plan. They are useful in planning the project teamsu2019 work schedule and
providing some control on a day-to-day basis. The estimates are constantly refined as
work proceeds and knowledge increases.
Other topics in the project plan include:
Deliverables
Work plan
Budget
Project organization
Plans for risk management, quality assurance, and team training
Detailed Project Plan
The detailed project plan specifies the work to be done, when, and by whom. It identifies
specific days and individuals. This plan is used throughout the implementation cycle.
Topics include:
Organization/staffing requirements
Management responsibility
Resource allocation
Cost/benefit analysis
Risk Assessment
You should evaluate what the company risks by accepting the project and what the
company risks by not accepting the project. In addition, the value-added result must be
considered. Some factors to consider are:
Lack of resources
Compatibility across all regions of the country
Gaining acceptance of the tools
Training/Keeping current
Departmentalized communications
Potential for business errors/mistakes
Cost of not doing the project now and doing it in the future
Economies of scale
Cost of being behind technology
Cost of competition
How much faster/better the company will operate
How this transfers to customer service
Phased Approach
A phased implementation occurs when SAP components are implemented step-by-step,
over a period of time.
Factors favoring a phased approach include:
Change occurs slowly, and not all sections of the company have to be reoriented at
once.
The expenditure is spread over a longer period of time.
Project teams are generally smaller and thus easier to coordinate.
Successes are quicker and more apparent in short-term.
Factors against a phased approach include:
Old systems must be serviced through interfaces that have to be created.
The interface programs are no longer used afterwards.
Advantages of the SAP R/3 System are felt slowly.
Award if useful to you
Edited by: narendran vajravelu on Oct 14, 2008 8:00 AM