Statement of Work (SoW): What is it?
An essential part of any successful project is a clear statement of work. A statement of Work (SOW) is a contractual agreement between two or more parties that sets out the terms and conditions of a task, service, or project.
A statement of work (SOW) is a document that outlines the specific tasks, responsibilities, and deliverables required to complete a project. It is essential for communication between clients and contractors, ensuring that everyone understands exactly what is expected of them and when it is due.
While not mandatory, using an SOW can help prevent misunderstandings and ensure that everyone involved in the project is on the same page from start to finish. A clear statement of work can help keep everyone on track and prevent disputes from arising later on in the project.
To avoid such disputes a well-written statement of work should include:
- The project objectives
- List of tasks leading to the project completion
- Specifics related to who will be responsible for completing each task
- The proposed timeline or the due dates for deliverables
- What resources will be needed
- Payment schedule and deadlines
- What is expected in return
- Consideration of who will lead the project and take on important duties
How do you know that you need a statement of work?
A statement of work (SOW) is a document that outlines the specific tasks and responsibilities associated with a project. It helps to ensure that all parties involved in the project are clear on what needs to be done and when it should be done. The goal of an SOW is to avoid misunderstandings and nasty surprises down the road.
There are two situations when you will need a statement of work. The first, the most common one is when you are hiring someone to do work for you. It can also be helpful when you need to know what has been done and who is responsible for it. And it may also be used as an intermediary planning phase for larger and more complicated internal projects that require structured organizational controls to be successful. When a project is vast and complicated a well-written SoW sets out the expectations and lets the team members know if they need any subject matter experts in the project.
Types of the statement of works
The most popular types of Statement of Works are:
Design and detail Statement of Work
The contract in design/detail SoW specifies work expectations for the supplier. This includes precise metrics, resource requirements, limitations, quality control requirements, and much more.
Level of time, effort, and material SoW
This sort of SoW is applicable to practically any type of service-based contractual agreement. It contains all the basic elements of any statement of work but it focuses more on the time spent on the work and supplies required to complete the project..
The most common type of SoWs is performance-based ones. These agreements will list down the expected deliverables. It will also show a definite set of results.
The key components of a good statement of work
Writing a statement of work can seem like an intimidating task, but with the right approach, it can be a straightforward process. It is important to follow all contractual stipulations when writing this document, as it can be used as proof in any dispute that may arise. A well-written statement of work can help to ensure smooth and efficient project completion.
An SOW should contain the following sections:
Objective: Every project has several goals and listing them ensures that the expectations are achieved.
Scope: These are the duties every team member will carry out to accomplish the goals.
Schedule: The team and the client must be aware of the varied deadlines for each project component.
Payments: All parties should be aware of the payment schedule and conditions.
Acceptance: Draw attention to the specific quality requirements that the contractor and the client must satisfy.
General guidelines to consider
There is no single formula for writing a statement of work, as the structure and content will vary depending on the type of project, the company’s standards, and your own writing style. However, there are some general tips you can follow to help make your statement of work clear, concise, and compliant with all the relevant legal requirements.
Use understandable language: Use clear, concise language. Be sure to use words that people will understand and use specific terms when describing what you need to be done. For example, say “create a new website” rather than “build a website.”
Be clear about the purpose: Start with a purpose. What are you trying to achieve with this project? State your objectives clearly at the beginning of your statement of work.
Provide enough information: Be sure to provide enough information for potential stakeholders to understand what you are asking them to do and how it will benefit them.
Include clear timetables: Be clear about the deadlines and consequences of not meeting those deadlines.
Make it easy to read: Finally, make sure that your statement of work is formatted in a way that makes it easy to read and follow.
You’ll frequently require SOW documents if your line of work involves developing products or providing services. So instead of writing each one from scratch, you use Fresh Proposals SoW templates which specialize in generating proposals, statements of work, agreements, and much more.