Preparing a statement of work (SOW) might seem intimidating at first, but trust me—it's not as daunting as it sounds. When crafted with care, a SOW becomes your trusty sidekick in preventing project mishaps.
In this post, we'll break down what a SOW is all about, explore why it's essential for your projects, and share a free downloadable template to get you started on the right foot.
Get ready to tackle your projects with newfound confidence!
What is a statement of work?
Simply put, a SOW is a contractual agreement between two parties outlining what will be delivered as part of a project.
A SOW differs from other project planning documentation, such as a scope brief or project charter, although these three documents are closely related.
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Project charter | Scope brief | Statement of work ~ Project managers use a project charter during initiation to define the purpose and goals of an effort. The project charter defines the high-level scope of work to hold key stakeholders accountable for project outcomes. You can think of the project charter as a document that defines the “what” and “why.” | A scope brief progressively elaborates the high-level scope defined in the project charter. It further details the “what” and explains how the project team will execute that work. | The SOW continues to build upon content in the project charter and scope brief. It formalizes the project schedule, deliverables, and milestones from the scope brief in the context of project goals and objectives from the project charter. The SOW also specifies how the work will be delivered and the associated project costs.
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What are the components of a statement of work?
Let's dive into the essential components of a statement of work! A rock-solid SOW should cover these crucial aspects:
- Project goals and objectives: Define the purpose and desired outcomes of the project.
- In-scope vs. out-of-scope details: Clearly distinguish between the project activities and deliverables that are included and those that aren't.
- High-level project timeline: Sketch out the overall schedule, including significant milestones, to keep the project on track.
- Deliverables list: Outline the expected deliverables, their due dates, and acceptance criteria. Remember to mention any reporting requirements!
- Estimated project costs: Provide a breakdown of the expected expenses for services rendered and outline the payment process.
- Conflict resolution mechanism: Establish a process for escalating issues and resolving disputes to ensure smooth sailing.
- Signatures of responsible parties: Get the green light from all the critical stakeholders by having them sign off on the SOW.
Do you always need a statement of work?
SOWs are necessary if you are working on an external project, particularly in an agency or consultancy setting, or if you're working with a subcontractor. It's an excellent way to ensure stakeholders are aligned on what is being proposed and the expected costs. It's also practical because it offers accountability in case something goes awry.
From the project team's perspective, you want a SOW in place to mitigate the risk of scope creep originating from your client, other stakeholders, or even your team members. From the client's perspective, the SOW helps ensure you get what you're paying for.
Since a SOW is a formal contractual agreement between two parties, creating one may not be necessary if your project is internal. In that case, you can use a project charter and a scope brief to define the project goals and objectives, deliverables, timeline, and expected costs.
Where does a statement of work fit in the project management process?
Once you've determined you need a SOW, you should develop it as part of the project planning phase.
During project initiation, the project manager should work closely with stakeholders to define the project purpose, collect buy-in, and codify the project vision as part of the project charter. Once stakeholders are aligned on the project goals and objectives, you can start to put more thought into how you will achieve them. This includes developing a SOW.
Remember that it's essential to craft the SOW before the project execution. You don't want to find yourself in a situation where you're defining the work you want to accomplish while the project is underway.
How to use a statement of work effectively
Here are three best practices for crafting a SOW and using it effectively:
- Use clear, concise language. Your SOW should not leave room for ambiguity. The purpose of this document is alignment and accountability, so make sure you specify the necessary details surrounding timelines and project requirements.
- Seek legal advice. Since a SOW is a contract document, make sure you have the legal team look it over before sending it for signature. While it’s true that legal review adds extra steps to your process, having an expert opinion substantiate your agreement prevents you from having to spend a lot more time later to clean up a potential mess.
- Reference it often. A SOW is not a document you should write, save in the cloud somewhere, and forget about. Instead of letting your SOW atrophy in your organization’s file storage repository, reference it frequently during project execution to help you deliver within agreed-upon timelines and quality standards.
Your go-to statement of work template
We're excited to share this free downloadable template to kickstart your SOW journey! Just click on the link below to access your new go-to resource.
A friendly reminder: It's always a good idea to consult with your organization's legal team before entering into any binding contractual agreements. They'll be able to help you navigate any potential pitfalls and ensure you're on the right track.
Happy SOW crafting!
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Need a document to keep all these details in one place? Choose from one of our 8 free work plan templates.
