B - Statements of Work

What is a Statement of Work?

A Guide to the Project Management Body of Knowledge (PMBOK™ Guide) defines a Statement of Work (SOW) as “a narrative description of products or services to be supplied under contract.” The definition, as written, can be interpreted to mean only those products and services to be provided to the client; however, in actuality, it should also encompass the needs and requirements of the contractor to properly perform the delivery of the products and services (facility requirements, security access, and so forth). To ensure clarity, the definition may be expanded upon to read: “a narrative description of the products and services to be supplied to a client, as well as a description of the contractor's needs and requirements to properly perform the delivery of such products and services under contract.”

The SOW must identify the responsibilities of all parties involved.

Why is the SOW important?

The SOW establishes the baseline or foundation upon which the services and products are to be delivered. The importance of having a solid foundation almost goes without saying.

Imagine the construction of a house. One of the first things you do in constructing a house is to build the foundation. Since this is what the physical structure rests upon, the structural integrity of the house is largely determined by the stability of the foundation. While it's relatively easy to go back and make adjustments to the superstructure, it is often impossible to make changes or adjustments to the foundation. Thus, it's imperative that the foundation be constructed right the first time.

Most project failures occur not in the implementation or execution phase of a project, but in the initiation and planning phases. During this time you establish the foundation that will ultimately determine whether the project will succeed or fail. Without a detailed description of the work to be performed, you're essentially managing a project with an unknown objective; as such, you have no baseline upon which to measure progress or to base change (i.e., scope, cost, schedule, etc.). It's also important to note that change doesn't necessarily cause a project to fail. It's an organization's inability to properly manage change that will ultimately lead to project failure. Without an established baseline or foundation for a project, you are left trying to manage change on an undefined or unknown scope.

The SOW is also a supporting document to the contract. The contract defines the legal terms and conditions whereas the SOW defines in detail what services and products will be provided to the client, as well as what you, the service deliverer, require from the client to properly provide those services and products. It basically provides all parties with an objective measure of when work is satisfactorily completed and when payment is justified for such work.

Structure of a Simple SOW Writing Style Suggestions
  • Project Title
  • Project Period of Performance
  • Background or Problem Statement
  • Objective
  • Scope of Work
  • Requirements
  • Deliverables
  • Terminology/Glossary
  • Project Budget
  • Applicable documents
  • Use a straightforward numbering system
  • Write in the active person
  • Avoid legalese
  • Avoid vague words
  • Avoid indefinite phrases
  • Define acronyms
  • Include sufficient details

Identifying risks and addressing mitigation in the SOW is a best practice. This means first, identify key risk areas and sources of risk. Next, determine how to manage and contain risk. Then add those elements to the SOW. Be sure to consider using milestones and payment schedules to manage potential risk. Mitigate risk by adding performance-based elements to the SOW. These include items such as:

  • Project Title: Provide a consistent title that will be used by both parties to identify and administer the project on reports, invoices and communications.
  • Background/Problem Statement: Briefly describe how the specific project/task in the SOW relates to the primary project.
  • Project Budget: Include a detailed budget that covers the entire project period of the SOW. If the period of performance is multi-year, the budget should be represented in yearly increments.
  • Deliverables: Outline project deliverables to be provided, dates due and to whom they should/will be delivered.
  • Period of Performance: Provide the specific start and end dates for performance of the SOW. If the SOW performance does not span the entire project, be sure to note. For example, if the SOW is only performed in years 2-3 of a 5 year project, be sure to indicate the exact dates.
  • Requirements: This section should provide a detail to support the SOW, to include tasks, meeting frequency and types, milestones, required compliance measures and payment.
  • Scope of Work: Statement of project, intended accomplishments and overview of all tasks to be undertaken to accomplish project goals. This section should include methods and timeline.
  • Terminology/Glossary: Define any terms, as needed.