Successful Project Management, Second Edition

In this section we look at the practicalities of planning a project. The first step involves drawing up a project specification, sometimes referred to as 'terms of reference'. It's an agreement between the sponsors and the project manager which sets the direction for the project, describes what you are going to do and the resources with which you can do it.
The process for developing a project specification can vary. For example, a project manager may be given a minimum outline of what needs to be achieved. It is then his or her responsibility to scope out the project and return to the sponsors with a detailed project specification for approval. Alternatively, sponsors may draw up a precise project specification and the project manager just has to decide how to achieve it.
This is the point at which big decisions are taken about the overall shape and direction of the project. If the wrong decisions are taken at the start, the project's chance of success is greatly diminished.
There is more than one way by which these decisions can be reached:
The project sponsors the people who have the authority to set the project in motion and who are paying the bills decide what needs to be done and then pass the project on to a manager who will carry out their wishes.
The managing director called me in and told me he'd got 5000 to spend on improving the IT system in...