Project managers in all industries must keep tabs on various moving parts to ensure their deliverables come through complete and on time. One of a project manager’s responsibilities is to ensure all key players perform the work required of them to complete the project. A statement of work (SOW) is a document that details the project-specific activities, deliverables, and details a vendor or service provider offers a client toward a project.
This may sound straightforward, but a good SOW has several essential elements, all of which are necessary for project managers to accurately track progress and ensure accountability for all key players.
Why Are SOWs Vital?
Modern project management often requires coordinating projects between in-house teams, outside vendors, contractors, and other stakeholders. A multifaceted project for virtually any industry will require careful collaboration and adherence to the overall project timeline. One of the primary functions of a SOW is to ensure accountability and completeness of all aspects of a project.
SOWs also cut down on miscommunications by making expectations clear to all project participants. A good SOW should include the following information:
- A clear list of expectations for the service provider.
- A description of the quality and service level expected from the provider.
- Applicable restrictions pertaining to the provider’s services.
- Pricing for the provider’s services.
- Governance and regulatory terms and conditions to which the provider must adhere.
- A schedule for the project, including deadlines for project activities and deliverables.
In some cases, a project manager will need to outline a very specific description of everything expected of a vendor or service provider. Ultimately, the more detailed and descriptive a SOW is, the more control the project manager has over that aspect of the project. Project managers must also know the different types of SOWs and when to use them.
Types of SOWs
Different projects will require various vendors, experts, service providers, and contractors to reach competition. These stakeholders will all have different responsibilities and contractual obligations, so it’s crucial for project managers to provide them with the most appropriate SOWs for their project-related responsibilities. SOWs exist in three main forms:
Design or Detail Statements of Work. The most basic form of SOW clearly explains the exact requirements of a job to the contractor, vendor, or service provider. This type of SOW generally includes a list of specific details such as required tolerances, quality control requirements, materials to be used, and how the project manager expects the provider to perform the work required. The project manager assumes a measure of risk by using this type of SOW since it essentially instructs a vendor or service provider to complete a task in a very specific way.
- Time/Effort or Materials/Unit Rate Statements of Work. This is a generic form of SOW that can apply to virtually any kind of project. This SOW will highlight the time required for the vendor or service provider to complete the work and the materials needed for the job.
- Performance-Based Statements of Work. If a project manager does not have clear expectations as to how a provider completes a required task, a performance-based SOW is the preferred format. This type of SOW will include parameters for objective completion and may include compensation stipulations for the vendor or service provider based on the level and quality of work completed.
Each type of SOW can be useful for different types of projects; it’s up to project managers to determine how best to use SOWs and which types are most appropriate for a given project.
How to Write a Solid SOW
Regardless of the type of SOW your project requires, it is essential to know the basic elements that every SOW should include. Many organizations develop templates for different types of projects, and these templates can be easily tailored to different stakeholders, vendors, and service providers as required.
When writing a SOW, the project manager should begin with a clear description of the purpose of the project. This helps keep different stakeholders and project participants focused on the ultimate goal of the project and help them identify issues as early as possible to prevent miscommunications and slowed project timelines.
Other basic requirements that should form the introduction to the SOW include:
- The location where the project will take place or where the vendor will complete the required tasks listed in the SOW.
- The full scope of the work to be done within the project.
- A clear description of the time period during which the project work will take place.
- Expected deadlines for project deliverables.
- Industry-specific standards and regulations vendors and service providers must follow.
- Payment schedule for project participants.
- Clearly defined responsibilities for project-related expenses.
- All project-specific special requirements.
No two projects are exactly alike. While some project managers may refer to the same SOW templates for similar projects over time, they should always take time to carefully construct their SOWs specific to every stakeholder involved in their projects. SOWs should be as specific as possible and well-worded to eliminate confusion and keep all project participants on track to complete their objectives safely, effectively, on time, and within the stipulated parameters.