Terms of Reference

08 October 2010

The terms of reference in the business world are very specific in their meaning. In most cases this is referred to as a project charter, or group charter. This is the formal documentation of the scope or objectives a group of people have decided to follow when venturing on a joint project or program together. Some have even referred to it as the rules to be followed.

When the terms of reference are used when speaking about a project, more details can be put into place to describe it. Within this charter should be some very important statements that define the project and what is to be achieved so no ambiguity is left. This is called the scope and objectives of the project.

The purpose of the terms of reference is so there will be a document of what was agreed and that will guide the progress of the project. It is also the reference that all the other plans will relate to for staying focus on the projects deliverable.

Documented in the terms of reference will be the specific description of the deliverable along with the specifications the final product is to meet. The roles and full responsibilities of the stakeholders are also clearly stated. For the most part this group of people is like silent partners after this document is signed and approved. This is if the project charter is followed properly.

The terms of reference is the basic outline for the project to follow that points in the direction the project should always maintain. This is set out by the inclusion of the work breakdown structure and schedules of the project.

The terms of reference should be one of the very first document that is drawn up after the project’s plan and feasibility study have been approved by the stakeholders. This should always happen before any actual work commences on the project itself.

The terms of reference is the guiding path that the project manager will follow if any questions arise during the course of executing the project.