Guidelines for Writing a Comprehensive Statement of Work

by  —  September 29, 2017   

A Statement of Work (SOW) is a document that a client or customer shares with a potential supplier or service provider, to communicate his requirements that must be satisfied. It is an essential document that sets out the  objective of the project and the client’s expectations on how it should be met and delivered.


A clear, well-written, accurate and complete SOW enables the supplier to establish a precise commercial value of the proposed solution.  And typically the SOW becomes incorporated, in whole or in part, into of the contract that will be signed by both parties


The following outline aims to provide a simple guideline on how to develop a Statement of Work.


1.Executive Summary

A short summary that includes a high-level description of the project, its purpose and objective, deliverables, timing and other key important elements of the project.


2.Acronyms/ Definition of Terms

Every organization uses its own jargons and acronyms, and sometimes even pretty standard terms can have a unique definition within an organization. This section may not seem important, but it is essential to attain the same level of understanding between client and service provider.


3. Project Overview

Utilize this section to present a brief but clear description of the project and or task,  its purpose, the expected end result, and timing plan.

Background information such as current processes, inputs, drivers, integaration,  and other related aspects of the company’s wider operations that will have a direct link or impact to the project.

Include assumptions, business conditions and known risks that may affect the project delivery, timing, performance metrics or end result. Information about supply and demand, historical information or forecast may be provided. This sets out a clear and transparent setting of the business conditions upon which a supply or service agreement will be drawn.


4. Project Scope

The project scope presents a detailed description of the client’s functional requirements and service provider’s deliverables, which may range from detailed set of instructions for precise execution to simply a definition of successful delivery, allowing supplier’s creativity,  performance metrics, penalties and incentives.

This section must have a narrative that explains clearly the criteria for assessing an acceptable quality or performance, mutually agreeable metrics and performance measures. Metrics should be developed as a measurement for success.  These metrics should be defined in a request for quote and negotiated with the supplier as part of the overall supplier selection process.  It is important that both the objectives and metrics are clearly defined in the project since this is the system that will be used to determine overall success.

The scope may call for specific resources or skills that may need to provided or it could be an open to the discretion of service provider to determine what resources should be pulled in to execute and deliver the project

The scope should also be clear about the timing expectations when the project should start, when should it end, and it key milestones and gateways in between.

Equally important is the  clear identification of elements that are within the scope and  what is not within the scope of the project.  This is an important element is setting expectations of both parties and provides a discipline to ensure that “scope creep” is minimized.


5. Project Deployment Plan

This describes the overall plan including resources, methodology and timing to deliver the required solution. This will also cover any roles and responsibilities of the client to support the service provider’s readiness for the implementation. Identify the requirements of information, resources, personnel, and the timing of the responsibilities in order to support the project.

Another vital element is the process for developing and communicating changes that are related to the delivery of the project objectives but are outside of the current scope of work.


6. Commercial Requirements

This section sets out the expectations regarding project cost, rates, invoice billing and payments schedules. The client may specify a cost breakdown template to facilitate a quicker analysis of the quotes. This section can also be used to clarify how invoicing should be made, for example, a weekly invoice of total hours worked at rate agreed, plus cost of materials and travel, or it can be an agreed fixed amount after a critical gateway is completed.

This can also include penalties and incentive schemes, or the process and mechanism for rate reviews.

Depending on the project and the organization’s policy, this is also the section where the client states its not-to-exceed budget.


7. Continuous Improvement or Change Management Process


If the duration of the contract is long enough to assume that adjustments may be required either to mitigate risks, or capture opportunities, then it is important to have a clear agreement on how to implement change.


8. Terms and Conditions

The terms and conditions will set out terms and conditions of the trade, and can cover liability, insurance, confidentiality clauses and other contractual obligations.

More often than not the successful implementation of projects highly depends upon how the Statement of Work was set out at the beginning. Ensuring that both parties clearly understands their roles and obligations in the scope of work protects the interest of both parties, and takes away risks of mismatched expectations in the end.