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This is a basic question that was asked on another site (a precursor to this site) but that seemed to be very helpful to visitors. Let me know if you find it useful.

When initiating a project there are many different names for the base project document which is compiled at the beginning of every project.

Like:

* Project Charter
* PID (Project Initiation Document)
* SoW (or Project Statement of Work)
* Project Proposal
* you can name others

Are those the same or similar (by content or purpose)? What makes them different? When should each one be used?

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I don't use/have never used a PID (Project Initiation Document), but as for the others, they are different. In my line of worK:

The Project Proposal is a document written by a hopeful contractor to a customer as part of a bid for work. It typically includes 3 major sections:

  • Technical proposal
  • Management proposal
  • Cost Proposal

Depending on the size of the contract a proposal can be anywhere from 5 or 10 to thousands of pages long.

The proposal may also be required to contain a 'separable SOW' - a completely self-contained statement of work that the contract will perform to after award.

The Statement of Work defines at least the goals, scope, period of performance, milestones, major activities, and reporting requirements. It may also define quality, compliance or performance standards, security requirements, financial reporting requirements, travel etc. Depending on the size, complexity, and type (fixed price, cost plus) of the contract, the details of a SOW can vary wildly.

The statement of Work is typically more than 3 - 5, but less than 20 pages long.

The Charter can be defined in several ways, but if working on a project that already has a formal SOW, it can be as simple as a document that formally associates a specific project manager with a charge number and a statement of work. It formally authorizes the PM to use the defined charge number to plan & execute the project.

A charter is frequently 1 page.

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Under the PMBOK framework, these are different. They would be (differences or defining characteristics listed only):

  • Charter: a sponsor-signed document indicating work can begin
  • PID: same as Charter
  • SoW: an initial scope statement. It's a section in the charter.
  • Proposal: Might be the "business need" of the project, or the SoW. Goes into the charter too.

PMI's framework is pretty simple: the charter has all the information needed to get it signed by the sponsor so that work can begin. Anything and everything can go into the charter, from scope (SoW), timelines, milestones, etc.

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  • According to PMBoK, SoW is an input to developing a project charter. Would it be redundant to have that section in the project charter?
    – supertonsky
    Apr 10, 2013 at 9:04
  • @supertonsky it's up to you. PMBoK is also a general framework, so customize it and use it in the way that is the most useful for you.
    – ashes999
    Apr 10, 2013 at 10:48
  • In the context of PMBoK, I'm trying to understand why did PMI put SoW as an input to Project Charter when we can simply have just the Project Charter. It seems to me that SoW is a subset of Project Charter and most likely will be done by the same person. To put it simply, why SoW needs to be an input to the Project Charter? I don't get this.
    – supertonsky
    Apr 10, 2013 at 12:58
  • @supertonsky see the accepted answer. It's an input because it becomes part of the charter. "We created this project because ... here's the initial scope (SoW)."
    – ashes999
    Apr 10, 2013 at 14:05
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Exact name of an exact document is dictated by a management framework used by the team. Project Charter is from PMBOK. PID is from PRINCE2. SoW and Project Proposal are from somewhere, I never met them in RUP, MSF, Scrum.

What really matters is the content. In this case we're talking about a document that formally authorizes the project and answers at least the following questions:

  • Who and how shall approve the budget and schedule?
  • Who shall approve the scope statement?
  • What is the risk tolerance of the project?
  • Who is the sponsor (who will pay the money)?
  • Who is a project manager?
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Part of the confusion is caused by not recognising there is a difference in terminology and methods between internal projects and commercial projects. Both PMBoK and Prince2 have a heavy bias towards project approaches and methods concerned with delivering internal projects e.g. focus on cost management and not financial management, PID's and Charters, where commercial projects i.e projects where you are delivering a solution or service to an external client are much more aligned to things such as Proposals, MSA's, Statements of Work etc. One interesting conundrum that unfortunately has not been resolved is making a clear distinction between a Statement of Work and a Scope of Work both acronymed as (SoW or SOW) but having quite different purposes. I would support using completely different terminology to make the distinction perhaps things like Project Scope, Statement of Requirements (SoR) etc. All fun and games so have a dictionary at the ready

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Project Charter Vs PID ( Project Initiation Document)

Initiating a project usually involves writing one of two documents; a Project Charter or a Project Initiation Document (PID). Now a great many things happen during initiation. High level scope is determined, deliverables set and budgets estimated. If these aren't investigated and documented effectively it can adversely impact the entire successful delivery.

Well to give a quick overview, a PID is a highly detailed paper which forces a PM to spend time upfront in seriously thinking about the deliverables, processes and governance required, before it even starts. A Project Charter is far less detailed and hence requires much less from a PM. It is essentially a quick way for work to get underway fast. However, despite this, both documents have a similar feel and endeavour to fulfil the function of enabling effective initiation. But as you will have already seen, both definitely put the emphasis in different areas.

So which is better? Well if you have a small project then writing a long, convoluted PID doesn't make sense. On something this size it is highly likely the deliverable will be simple, the amount of resources utilised small and there will be just the one Sponsor. On bigger or more complex projects, writing a PID will definitely make sense. Yes it is a detailed paper to complete, but ironing out issues surrounding scope, roles, responsibilities, development process and governance upfront is absolutely vital to prevent confusion later on.

The approval process for each document certainly bears this out. A Charter can be approved simply by the sponsor. A PID requires all the sponsors and other key individuals to formally approve it. This is harder to get and certainly takes time, but it means that activities start with all the stakeholders signing up to the same understanding of what is being delivered and when.

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