A statement of work is a formal document that captures and defines the work activities, deliverable

Deliverable

Deliverable is a term used in project management to describe a tangible or intangible object produced as a result of the project that is intended to be delivered to a customer . A deliverable could be a report, a document, a server upgrade or any other building block of an overall project.A...

s and timeline a vendor will execute against in performance of specified work for a client. Detailed requirements and pricing are usually included in the Statement Of Work, along with standard regulatory and governance terms and conditions.

Overview

There are many formats and styles of Statement of Work document templates that have been specialized for the Hardware or Software solutions being described in the Request for Proposal

Request for Proposal

A request for proposal is issued at an early stage in a procurement process, where an invitation is presented for suppliers, often through a bidding process, to submit a proposal on a specific commodity or service. The RFP process brings structure to the procurement decision and is meant to...

. Many companies create their own customized version of SOWs for use within their industry or vertical that have been either specialized or generalized to accommodate the typical request and proposals they receive.

It is important to note that in most cases the Statement of Work being agreed upon is a binding contract. Master Service Agreements or Consultant/Training Service agreements postpone certain work specific contractual components that are addressed in individual Statement(s) of Work.

Areas addressed

Areas that are typically addressed by a SOW are as follows:

• Purpose: Why are we doing this project? This is the question that the purpose statement attempts to answer.
• Scope of Work: This describes roughly the work to be done in detail and specifies the hardware and software involved and the exact nature of the work to be done.
• Work: This describes where the work is to be performed. This also specifies the location of hardware and software and where people will meet to perform the work.
• Period of Performance: This specifies the allowable time for projects, such as start and finish time, number of hours that can be billed per week or month, where work is to be performed and anything else that relates to scheduling.
• Deliverables Schedule: This part lists the specific deliverables, describing what is due and when.
• Applicable Standards: This describes any industry specific standards that need to be adhered to in fulfilling the contract.
• Acceptance Criteria: This specifies how the buyer or receiver of goods will determine if the product or service is acceptable, what objective criteria will be used to state the work is acceptable. See Acceptance testing
• Special Requirements: This specifies any special hardware or software, specialized workforce requirements, such as degrees or certifications for personnel, travel requirements, and anything else not covered in the contract specifics.
• Type of Contract/Payment Schedule: The project acceptance will depend on if the budget available will be enough to cover the work required. Therefore payments breakdown whether up front or phased will be negotiated very early at this stage.
• Miscellaneous: There are many items that do not form part of the main negotiations but are nonetheless very important to the project. They seem minor but being overlooked or forgotten could pose problems for the project..

United States government contracts

For U.S. government service contracts, the use of SOWs remains strong, although Statements of Objectives (SOOs) and Performance Work Statements (PWSs) have become increasingly popular due to their emphasis on performance-based concepts such as desired service outcomes and performance standards. SOWs are typically used when the task is well-known and can be described in specific terms. They may be preferred when the government does not desire innovative approaches or considers any deviation in contractor processes to be a risk. Whereas SOOs establish high-level outcomes and objectives for performance and PWSs emphasize outcomes, desired results and objectives at a more detailed and measurable level, SOWs provide explicit statements of work direction for the contractor or offeror to follow. SOWs are typically replete with "contractor shall" statements and statements of mandatory compliance (e.g., "This task shall be performed in accordance with Agency xyz Directive, dated mm/dd/yyyy"). In practice, SOWs can also be found to contain references to desired performance outcomes, performance standards, and metrics, thus blurring their distinction between SOOs and PWSs. Aside from good practice, there is little government policy guidance that emphatically prescribes how and when to use SOWs versus SOOs or PWSs. Whereas the FAR defines PWS in Part 2 Definitions, and references SOOs and PWSs in Part 37.6 Performance Based Acquisition, SOWs are not addressed. Some industry and agency guides are provided below in External Links.

SOWs are usually contained in the government's solicitation (RFP or RFQ) and carried forward, as may be negotiated with the offeror, into the final contract. In federal solicitations and contracts, SOWs are inserted into Section C "Descriptions/ Specifications"(See Uniform Contract Format, FAR 14.2), but may also be inserted as an attachment in Section J). In task orders, the SOW may simply be included among the terms and conditions of the order itself. The SOW is often supplemented by technical reference documents and attachments. In developing the SOW, it is important to ensure that the statement of work is comprehensive and sufficiently detailed, but that the statements do not duplicate terms and conditions or other provisions elsewhere in the solicitation or contract.

External links

• Statement of Work Writing Guide - A do-it-yourself guide to developing an RFP Statement of Work
• How to write the Statement of Work
• Handbook for Preparation of Statement of Work (SOW)