Six Sigma Project Charter

Project Management refers to the process of getting the project completion within the available resources and designated timeframe effectively and efficiently. Project management is an application of knowledge, skills, tools, and techniques to project activities in order to meet project requirements.

Project charter is a statement of objectives of a project which also sets out detailed project goals, roles and responsibilities. It also identifies the main stakeholders. Project charter henceforth consists of the problem statement for which the project is initiated, the purpose outlining the goals to be achieved by the project, the scope of the project on enlisting the resource requirement and the results to achieve in quantifiable terms. Project charter also contains the likely benefits to the stakeholders for taking up the project and justifies the feasibility for same.

It includes

• Business Case – Business case helps to understand how the project is linked with the overall business objectives. Business case explains why there is a need for the organization to undertake the project and how it will support organizational objectives. For example – “By reducing the average transaction length, the queue would be able to enhance the Speed of Resolution and assist the end-users in fastest possible manner. This will not only help in achieving client targets but also increase end-user satisfaction score by offering lesser turn-around time.”
• Problem Statement – Problem statement should quantitatively describe the pain in the current process. For example – “In the last 3 months (when), 12% of our customers are late, by over 45 days in paying their bills (what) . This represents 20% (magnitude) of our outstanding receivables & negatively affects our operating cash flow (consequence) .”
• Goal Statement – Defines the improvement the team is seeking to accomplish. It starts with a verb. It Should not presume a cause or include a solution. It has a deadline. It is actionable and sets the focus. It should be SMART (Specific, Measurable, Attainable, Relevant and Time Bound). For example – To reduce the percentage of late payments to 15% in next 3 months, and give tangible savings of 500KUSD/ year.
• Project Scope – Project Scope helps us to understand the start and end point for the process and also gives an insight on project constraints and dimensions. It’s an attempt to define what will be covered in the project deliverables. Scoping sharpens the focus of the project team & sets the expectations right.
• Project Milestones – Project milestone in a charter specifies timelines for completion of each phases with signed tollgates. It is a preliminary, high level project plan with dates, which is tied to phases of DMAIC process. It should be aggressive (don’t miss “Window of Opportunity”) yet should be realistic (don’t force yourselves into “Band-aid” solution). The project milestones to further include a detailed project plan (Gantt chart) along with a documented communication plan.
• Specification Limits – A specification is a customer-defined tolerance for the output unit characteristics. There may be two-sided specifications – Upper Specification Limit (USL) and Lower Specification Limit (LSL). Any data point above the USL and below LSL is termed as defect. Specifications form the basis of any defect measurement exercise on continuous data.
• Resources and Team Roles – Ultimately executive leadership team together with Six Sigma Deployment Leader and Six Sigma Champion need to ensure that a trained Six Sigma Team and associated hardware and software resources are in place to successfully implement the Six Sigma project and deliver great results and customer value!

Defining resources, roles, and responsibilities starts with specifying the people who are going to be involved and how long their involvement will be. It’s important that team roles and responsibilities are clearly defined. To help with this process, you can use a responsible, accountable, consulted, and involved, or RACI, chart for any given step in the process.