How to write an effective Statement of Work

January 2, 2023

An effective Statement of Work (SOW) is of fundamental importance to project managers. Compiled at the outset of a project, an SOW outlines what does – and what does not – go into the scope of a project. A clearly defined and worded SOW can save project managers from numerous headaches later in a project’s lifetime.

Spending time and careful thought on crafting a watertight SOW can help ensure projects are delivered on time and clients are clear on what is being delivered and kept happy. This article focuses on SOWs and their critical nature as project management tools. It explains SOW types and gives super-handy tips for project managers on how to write an effective one.

What is a Statement of Work?

In simple terms, an SOW is a detailed account of a project’s scope and an agreement between a client and a contractor, agency or another type of service provider. SOW defines for all parties what is involved within a project.

An SOW is written in the formative stages of a project, and is a contractual, legal document. It defines the scope, outlines the work requirements, and aligns expectations. An SOW typically sets out to first answer the question – why is the project being undertaken?

A project’s SOW also describes the scope of work or a description of the work to be completed and the requirements in terms of people and tools required to do so.

An SOW includes detailed information on other critical aspects of a project, examples of which are:

Project Governance – or who has the approval to do what and when.
Work Breakdown Structure – that identifies project tasks, milestones and deliverables.
Period of Performance – that specifies the permitted time for projects and scheduling.
Acceptance criteria outline how the vendor and supplier determine if services or products are acceptable.
Assumptions – it is nigh on impossible to plan a project without making some assumptions about unknowns, but these should be explained in an SOW.
Estimates – including project pricing, payment scales and schedules.

Statement of Work vs Scope of Work

In some respects, an SOW and “scope of work” (SOA), can be synonymous. Any effective SOA should include detailed information pertaining to the scope of the project.

The key difference between the two terms is that the SOW is the document that sets out the scope and parameters of a project. Rather than simply stating the scope of a project, an SOW is a contractual document that sets out the terms and conditions of the project’s scope.

A carefully-crafted SOW is an important tool in avoiding the worst excesses of scope creep, as described in this article.

The Importance of a Statement of Work

Having an effective SOW simply cannot be underestimated by project managers. Since an SOW is put together at the outset of a project, not giving it appropriate attention can cause major issues later on. In a nutshell, an SOA is important because it helps make sure that vendors and their clients both understand the purpose, scope, and especially the limits of a project.

It is important that vendors put together a watertight SOW so that deliverables, schedules, and other aspects of the projects can be clearly documented. This means there is a paper trail to which vendors can refer clients if they make additional demands not agreed upon at the outset of a project.

Spending appropriate time and energy on an SOW potentially saves project managers time, money and the need to have challenging client conversations.

An effective SOA can ensure both vendors and their clients are protected against either party moving the goalposts in terms of deliverables, timescales or other aspects of a project which were not agreed upon originally. This can also help project managers avoid the stress often associated with their role.

Types of Statement of Work

There is an infinitive number of projects and potential projects and therefore no single way of putting together a statement of work example. SOW project management orthodoxy, however, states that SOWs can be divided into three types.

These are; Design/Detail, Level of Effort, and Performance Based.

Design/Detail SOW – This type of agreement is commonly used for SOWs in industries like construction and manufacturing, as well as in public sector projects. As the name suggests, a Design/Detail SOW provides a detailed description of how a project is to be accomplished. This type of SOW allows the client to convey to vendors how the work has to be completed and details the resources required. What exactly is included in a Design/Detail project management SOW depends on the individual project, but it can outline aspects such as: quality acceptance criteria, payment terms, the measurement of materials, required dimensions and project deadlines.

Level of Effort SOW – This type of SOW is most typically used for short-term or temporary contracted services, and can also be part of SOWs for almost every project. Put simply, this SOW type is defined by the level of effort of a contractor combined with the materials used to complete the project and the cost per unit, typically measured by the hour.

Performance-Based SOW – This type of SOW is appropriately named as they are compiled based on performance rather than the manner of completion. These SOWs detail the project’s purpose, resources, results expected, and quality. As opposed to the Design/Detail SOW, which specifies how the project is completed, performance-based SOWs are often preferred by project managers as they focus on what has been completed. Performance-based SOWs grant project managers greater autonomy to deliver the projects without having to follow a pre-agreed methodology to do so.

How to Write an Effective Statement of Work – Top Ten Tips

There is certainly no singular way to write a statement of work, but following some helpful tips can help ensure project initiators put together a project-bespoke SOW.

The top 10 tips are:

Put time and effort into it! – As noted above, a well-crafted SOW can save project managers and stakeholders a lot of headaches and difficult conversations later on.
Make it easy to understand – Ensure the use of language all stakeholders can easily comprehend so everyone is clear about project aims and scope at the outset.
Break it up – Related to the tip above, projects can often be complex, so don’t over-complicate the SOW. Concentrate on what you know and want to achieve.
Make a plan – Be laser-focused on describing the details of the project, and on the road to completing it.
Make sure the correct people are involved – As well as the project team, project initiators should consider involving legal, procurement and other relevant colleagues.
Make it contextual – Set the scene for all stakeholders, explain what is to be done and why the project is being undertaken.
Be Specific – A vague SOW that is too generic or too broad is hazardous for project managers as it leaves room for multiple different interpretations.
Make (and explain!) assumptions – Given the complexity of project management, assumptions are inevitable. Assumptions must be explained at the outset
Share it and evangelize it! – Own the project and talk about it with relevant people before and during the project’s lifecycle.
Guard against scope creep – The worst excesses of scope creep can hamstring project delivery – a strong SOW at the beginning helps keep a project under control!

As well as the top ten tips, using an agency management tool like Weekwise can help project initiators think about what needs to go in a successful SOW. Weekwise can assist project managers with effective resource planning before and during projects.

Fully compatible with Slack, Weekwise’s current features can help project managers put together an SOW – and guard against scope creep throughout a project’s lifecycle.

These features include: Team – which provides project managers an instant overview of team members’ availability, costs, skills and current project assignments; and Timesheet – which gives project managers full records of who is working on which projects and a quick summary of vacation and sick days.