What is a Project Charter?

A project charter is a formal document that authorizes the existence of a project and provides the project manager with the authority to apply organizational resources to project activities. In Six Sigma, it's the first deliverable of the Define phase and sets the foundation for the entire DMAIC journey.

Governance & Methodology Authority

The charter acts as a project governance contract between organizational leadership and improvement teams, formally establishing the improvement mandate, resource commitment, and success criteria.

Charters support the tollgate review approval structure—each DMAIC phase requires formal review and approval, with the charter serving as the baseline reference for scope validation and stakeholder alignment.

The charter connects Voice of Customer (VOC) requirements, business case justification, and improvement metrics into a structured execution plan, ensuring projects deliver measurable financial or customer value.

Project Charter Sections

Project Title & Description

Clear, concise name and brief description of the problem or opportunity being addressed.

Business Case

Justification for the project including financial impact, customer impact, and strategic alignment.

Problem Statement

Specific, measurable description of the current state including baseline performance data.

Goal Statement

SMART objectives with specific targets for improvement. Links to problem statement.

Project Scope

Clear boundaries defining what's in-scope and out-of-scope. Prevents scope creep.

Team & Roles

Champion, Black Belt, Green Belt, team members, and their specific responsibilities.

Timeline & Milestones

High-level schedule with DMAIC phase completion dates and key tollgate reviews.

Resources & Budget

Required resources, estimated costs, and expected financial benefits (ROI).

Section Interpretation Guidelines

Problem Statement Rigor: Must include measurable baseline performance with specific data (defect rate, cycle time, cost). Vague problem definitions ("improve quality") doom projects to scope creep and ambiguous success criteria.
Goal Statement Value Linkage: Goals must directly connect to financial impact (cost savings, revenue protection) or customer value (satisfaction, retention). Goals without business impact struggle for resource priority.
Scope Risk Control: Precise scope definition reduces project risk by controlling improvement boundaries. Explicit out-of-scope statements prevent stakeholder expectation misalignment.
Team Accountability Structure: Role clarity (Champion, Black Belt, Subject Matter Experts) supports accountability and communication structure. Undefined roles create decision paralysis and execution delays.

Template Features

Guided Input Forms

Step-by-step forms with helpful prompts and examples for each charter section.

Methodology Benefit: Guided prompts improve charter consistency across improvement teams, ensuring all critical governance elements are addressed regardless of user experience level.

Professional Formatting

Automatically formatted to Six Sigma standards. Consistent, professional appearance.

Export Options

Export to Microsoft Word for editing, PDF for distribution, or PowerPoint for presentations.

Save & Collaborate

Save drafts and invite team members to collaborate on charter development.

Approval Workflow

Built-in approval tracking with electronic signatures from Champions and stakeholders.

Governance Compliance: Approval workflow supports project governance compliance, creating audit trails for Six Sigma program management and organizational certification requirements.

Template Library

Pre-built templates for common project types: manufacturing, service, healthcare, IT.

Knowledge Retention: Template standardization improves organizational improvement knowledge retention, embedding best practices into reusable formats.

Project Charter Assumptions

Methodological Requirements for Valid Charters

Strategic Alignment: Project objectives must align with organizational strategic priorities. Misaligned projects waste resources on improvements that don't advance business goals.
Leadership Sponsorship: Leadership sponsorship must support project execution through resource allocation, barrier removal, and political support. Unsponsored projects fail when conflicts arise.
Reliable Baseline Data: Baseline data must be reliable and measurable. Chartering projects without data-validated problems leads to solving symptoms rather than root causes.
Team Authority & Availability: Team members must have organizational authority and time availability for project participation. Nominal assignments without time allocation guarantee project stagnation.

Model Limitations

Critical Governance Constraints

Success Not Guaranteed: Project charters define improvement direction but do not guarantee project success. Execution quality, change management, and solution effectiveness determine outcomes.
Data Dependency: Charter quality depends on accurate problem definition and baseline data availability. Poor data produces poorly scoped projects with unrealistic targets.
Planning Limitation: Charters provide high-level authorization but cannot replace detailed project planning or risk management documentation required during execution.
Evolution Requirement: Charters require periodic review as project scope or business priorities evolve. Static charters become obsolete when underlying conditions change.

When NOT to Use a Formal Project Charter

Formal project charters may be inappropriate for certain improvement scenarios:

Small Operational Tasks

Routine operational improvements or minor task optimizations don't warrant formal charter overhead.

Rapid Kaizen Events

Short-duration continuous improvement events (Kaizen bursts) use event charters rather than full DMAIC project charters.

Exploratory Research

Investigative initiatives without defined improvement goals or clear problem statements require feasibility studies before chartering.

Short-Term Corrective Actions

Immediate containment actions or emergency fixes don't require DMAIC project charters—use corrective action documentation instead.

Why Use a Project Charter?

Formal Authorization: Officially authorizes the project and project manager
Clear Scope: Prevents scope creep by defining boundaries upfront
Stakeholder Alignment: Ensures all stakeholders agree on goals and approach
Resource Commitment: Secures necessary resources and budget
Success Metrics: Defines how project success will be measured
Risk Identification: Identifies potential risks and constraints early
Communication Tool: Serves as a reference throughout the project

Strategic Decision Value: Charters help organizations prioritize high-impact improvement opportunities over low-value activities. They provide alignment between leadership expectations and project deliverables, while helping secure resource commitment and budget approval through documented business cases.

Sample Charter Structure

Section	Description	Example
Project Title	Concise project name	Reduce Order Processing Time
Problem Statement	Current state with data	Order processing takes 5 days vs. industry standard of 2 days
Goal Statement	SMART objective	Reduce processing time to 2 days by Q3 2025
Scope	In/Out of scope	In: Order entry to shipment. Out: Shipping carrier performance
Team	Roles and members	BB: John Smith, GB: Jane Doe, Champion: VP Operations
Timeline	Phase completion dates	Define: Jan 15, Measure: Feb 28, Analyze: Mar 31...

Structure Interpretation Guidance

Baseline-Target Linkage: Emphasize clear linkage between baseline performance (current state) and improvement targets (future state). Measurable gaps justify resource investment.

Timeline Realism: Realistic timelines improve project completion probability. Aggressive schedules without resource analysis guarantee failure.

Accountability Clarity: Stakeholder accountability improves implementation success. Named individuals with specific roles prevent diffusion of responsibility.

Industry Applications

Manufacturing Defect Reduction

Reducing scrap rates, rework, and quality escapes in production environments. Charters define defect baselines, improvement targets, and measurement systems for statistical process control.

Healthcare Patient Wait Times

Emergency department flow optimization, clinic scheduling improvements, and discharge process acceleration. Charters address regulatory compliance and patient satisfaction metrics.

Supply Chain Delivery Performance

On-time delivery improvements, inventory reduction initiatives, and supplier quality programs. Charters align procurement, logistics, and operations teams.

Financial Services Automation

Loan processing automation, claims processing efficiency, and compliance reporting streamlining. Charters address regulatory requirements and digital transformation goals.

Software Quality Improvement

Defect reduction in development processes, deployment frequency improvements, and customer-reported bug reduction. Charters define coding standards and testing protocols.

Beginner's Guide to Project Charters

What a Project Charter Defines

A project charter is a formal document that defines what problem you're solving, why it matters to the business, who will work on it, what resources you need, and when you'll complete it. It transforms vague improvement ideas into authorized projects with clear success criteria.

Why Charters Improve Success Probability

Projects without charters face scope creep, stakeholder conflicts, and resource shortages. The charter forces clarity before execution—ensuring leadership supports the project, the team understands their roles, and everyone agrees on what "success" means. Projects with formal charters have significantly higher completion rates than informal initiatives.

Real-World Example: Customer Complaint Reduction

A retail company notices increasing customer complaints about delivery delays. Instead of immediately "fixing shipping," they create a charter:

Problem: Delivery complaints increased 40% (baseline: 50 complaints/month)
Goal: Reduce complaints to <20/month within 6 months
Scope: Warehouse picking and packing processes only (not carrier selection)
Team: Warehouse manager (Champion), Operations analyst (GB), Floor supervisor
Value: $200K annual savings from complaint handling and retention

This charter prevents the team from expanding into carrier management (out of scope) and provides measurable success criteria.

Frequently Asked Questions

What is the difference between a project charter and a project plan?

A project charter authorizes the project and establishes high-level scope, goals, and resources—it's the "permission to proceed" document. A project plan details how the work will be executed, including task schedules, resource assignments, and risk mitigation strategies. The charter comes first (Define phase), the project plan follows (Measure/Analyze phases).

Who approves a Six Sigma project charter?

Typically, the Project Champion (senior executive or business unit leader) approves the charter. In some organizations, Process Owners and Finance representatives also sign off to confirm operational impact and benefit validation. Black Belts or Green Belts create the charter, but Champions must authorize resource commitment.

How detailed should project scope be?

Scope should be detailed enough to prevent misunderstanding but not so granular that it constrains methodology. Define what's in-scope (process steps, departments, product lines) and explicitly state out-of-scope boundaries. Good scope statements prevent "scope creep" while allowing flexibility in solution approaches.

Can a project charter change during DMAIC?

Yes, but changes require formal revision and re-approval. If baseline data reveals different problems, goals prove unrealistic, or business priorities shift, update the charter and obtain Champion sign-off. Uncontrolled charter changes indicate poor initial planning or scope management issues.

What makes a strong problem statement?

Strong problem statements are specific, measurable, and data-driven. They answer: What is the problem? Where does it occur? When did it start? How big is the impact? Avoid blame language or solution suggestions. Example: "Customer complaint rate increased from 2% to 5% in Q2 2024, affecting retention rates" rather than "Customer service needs improvement."

How long should charter development take?

Charter development typically takes 1-2 weeks for DMAIC projects. Rushing charter creation leads to poor scope definition and stakeholder misalignment. Complex enterprise projects may require 3-4 weeks for stakeholder consultation and data validation. The time invested in charter development pays dividends during execution.

Create Your Project Charter

Free project charter template for Six Sigma DMAIC. Export to Word, PDF, or PowerPoint.

Start Your Charter →

Project Charter Template