While creating a statement of work might sound reasonably simple, getting it right is not. Through this specific type of document, both the customer and the supplier will be required to meet specific credentials that are based around the agreement. The advantages of a statement of work. Facilities. Wasted time (at $40/hour) is far more expensive than the cost of software. This is the time to start formulating the Statement of Work for each of the activities that contribute to project completion. Be sure to look at the many other templates available for free on our website. But include too much detail in the statement of work (SoW) and, you’ll find that you’re stuck with an inflexible process and deliverables that might not be adding to the overall value of the project. The Statement of Work (SOW) is an important tool used internally or externally to govern project activities performed by vendors or by departments within the organization. The failure to write (or properly write) a statement of work is all too often the reason clients and agencies end up in conflict. Move faster with the #1 project management and team collaboration tool. Lay the ground rules. So the terms SoW, statement of work, and scope of work can be used interchangeably; they all describe the agreement of work to be done. There’s no one way to produce a statement of work, but whether they’re five or fifty pages, they’re doing the same thing and setting the parameters of the project so everyone knows the boundaries of the project. This section of the Statement of Work (SOW) should provide a summary of the business need the organization is ad… It’s tempting to not bother with a statement of work; after all, who likes paperwork? ‌ Download Project Management Statement of Work Template. SoW’s provide the extra layer of detail that cost estimates and project plans usually don’t include to describe exactly what’s being done and delivered—and what’s not. This website uses cookies to improve your experience. The challenging question for project managers when writing the statement of work is deciding how much detail to include. If you’re able to get your statement of work right, it’ll save you a world of pain later in a project. Of course, there are lots of other things that you could put into a scope of work, like definitions, project team, resource plans, supplier and client responsibilities, acceptance criteria, specific service levels, reports, and that’s just the tip of the iceberg. Can you include their new feature request in a new project. Ultimately, a statement of work is about managing and documenting expectations. When the internal activities that contribute to a project are numerous and complex. The idea of a statement of work is not to catch a client out, but to state exactly what’s being done, how, when, and the cost. Meaning, it’s significantly easier to pick the right contractor. This plan is a subsidiary plan of the overall project management plan. Firstly, what is scope creep? At the end, the two are both very similar to one the other. The idea of an MSA is to agree on some basic terms so that any future transactions can be agreed upon more quickly. Keep it close, and know the statement of work yourself – making sure your client and team are clear on what’s in and what’s out by providing helpful reminders throughout the project. If you fail to communicate the details of the project properly with your team you can find them semi-innocently wandering off course. Statement of Work vs Work Breakdown Structure, A Statement of Work Shows Your Project Stakeholders Your Methods. Don’t be too dogmatic. Requests for proposals (RFPs) are documents created by companies or organizations when they wish to find an agency, vendor, or contractor for a particular service. A Statement of Work (SOW) is a project management document which describes the work that is required of an external contractor, vendor, or supplier. If it’s good for the project then you should be able to make a case to the client. This template offers a very complete structure for a statement of work, covering the followign areas: Project Definitions/Acronyms. You may have heard the term “Work Breakdown Structure,” and if you’re familiar with it, you might be wondering whether it’s the same as a Statement of Work. Client Responsibilties. The project charter, on the other hand, finds optimal uses in internal project management. It all boils down to the fact that the project charter specifies who is managing the project and has decision-making authority, whereas the statement of work does not. The MSA provides a strong foundation for future projects, and defines as many generic terms as possible so that they do not need to be repeatedly renegotiated; you only need to negotiate details of the project. Project Statement of Work (SOW) The following section is no longer applicable for PMBOK v6. This detailed Statement of Work (SoW) template provides you with an instantly downloadable, fully detailed, statement of work ready to use. Let’s clear this up. You can think of this document is a long word document that has words written in a typical legal language generally agreed between two parties while getting into a business agreement. – Definitive SoW estimate – When you’ve completed all due diligence and need project budget approval. In creating a statement of work you’ll probably end up adjusting your estimate and your timeline as you remember things that you should have added but forgot to. For example, the name of the appointed project manager is usually information that is internal to the company and would not be included in a statement of work. The Charter can be defined in several ways, but if working on a project that already has a formal SOW, it can be as simple as a document that formally associates a specific project manager with a charge number and a statement of work. Here’s a sample statement of work breakdown: Because SoW documents are such a massive undertaking, I’ve put together a complete sample statement of work that can help anyone who wants to get a jumpstart on their SoW in project management. It’ll save you a world of pain later. The Statement of Work (SOW) is an important tool used internally or externally to govern project activities performed by vendors or by departments within the organization. When you are planning to contract external vendors. In project management, SoW is an acronym for Statement of Work. A Statement of Work with a subcontractor for their part of a project: Depending on the project, you might have a bunch of these documents — one for each subcontractor. And a statement of work can be the worst because it’s a lot of work to produce – and even just a tiny mistake can have massive repercussions. Clients are always full of good ideas, and often have no idea of the implications of what they’re asking. It should also describe the work and activities that the seller is required to complete. Even worse – nobody looks at flowcharts. I get it. It is also legally binding and must be approved by the project’s client before work can commence. And as with any agreement, it’s always best if those making the agreement know exactly what they’re agreeing to. This level of detail provides reassurance to the client as to what will be delivered and ensures that there really is a shared understanding on what the project will deliver and achieve. You get what you pay for. To help define the scope of work and communication sections of your statement of work, use our RACI matrix template. This is about as close as you’ll get as a project manager to being a lawyer! So you’ve finally got your statement of work signed off on – now the real fun of keeping the project on track with the statement of work really begins. For both the agency and the client the statement of work becomes the bible in determining what’s “in scope” and what’s “out of scope”. You can stop fighting uphill battles every day immediately - and drive more personal success in your career by introducing the modern way of creating, tracking and even enjoying tasks with your coworkers. Chances are, the team that helped you create the SoW isn’t the team that’s now working on the project. Don’t let it all go down the drain by succumbing to every new request or pivoting to every new idea. Project scope describes what’s being done, and critically – how much of it. It is mandatory to procure user consent prior to running these cookies on your website. Suppose you agree with a client that you’ll create a new website for $100k. However, it is an essential component of the project charter. In this section, youll find over a dozen statement of work and project scope templates in Microsoft Excel and Word formats. This website uses cookies to improve your experience while you navigate through the website. Be clear and concise. Document processes, onboard and train your team from anywhere, Track processes to prevent errors and omissions, Automate business decisions and client experiences, Top Tips For Creating A Successful Team Charter, What is a Project Charter: Definition and Examples, How to Succeed With Project Planning: Step-by-Step Guide, PMBOK in Project Management: Definition and Best Practices, Step-by-Step Guide to a Successful Project Kickoff, How to Use Prince2 For Project Management [5+ Principles]. When you use a Statement of Work as a task specification document for an external vendor, it forms part of the contractual obligation the vendor must fulfill. Usually, these are handled by the purchasing department with input or final approval by the legal and the project manager. To identify scope creep you need to know your project scope well enough so you know what’s in and what’s out of the statement of work. Someone on your team wants to do an awesome job and so starts over delivering and giving the client more than they paid for, which would be great, if it wasn’t for the fact that similarly to scope creep, it hasn’t been accounted for, so takes the project over budget. I’ve delivered everything from film to CMS', games to advertising and eCRM to eCommerce sites. It is the narrative description of a project's work requirement. Decide what you’re doing and how. Project charters are important for initiating and managing internal project development because they include useful information regarding decision-making authority for the project (i.e: who is responsible for the development of the project). And who’s loading it? That’s where ProjectManager.com comes in. The benefits of using a statement of work template are clear: They save time, are easy to use, and provide the key sections needed to create a comprehensive SOW. Hey Valerie, glad you found it helpful! However, the specifications for the deliverable are vitally important. Print it out and have it on your desk so you can quickly refer to it. That level ownership is going to inspire confidence in the team as well as the client and enable you to deliver to it. Don’t be afraid of bringing up the statement of work in your client meetings – in fact make it a conversation topic in your weekly status meeting. Classic scope creep examples are when a client asks for an additional round of creative amends that weren’t accounted for, or when a client asks for a ‘favour’ which wasn’t budgeted for, like an additional format for a banner campaign. Thus, you begin by capturing the project scope. Awesome guide here. But equally, you don’t want to start writing a statement of work (SoW) when the client has approved your estimate. It’s the best because a statement of work (SoW) is so often the one piece of documentation that saves you from a world of trouble. Save yourself hours of work and instantly download the template (supplied as a .doc) for you to adapt as you need. Who’s creating the content for the site? It’s hard to distinguish the two because essentially, a statement of work is always present within the contents of the project charter. Then, begin the process of documenting as you’re creating the budget estimate so that by the time you’re creating the final statement of work estimate, you’ve got all the information you need to send the statement of work to the client quickly for sign off. If you do, you’ll hold up the project planning process and have forgotten lots of the detail. Although the SOW documents you prepare are primarily there to show contractors and internal teams what you require from them, they have another essential function. But if you’re looking for a statement of work example, you’re probably wondering how should you structure all this information so it doesn’t become totally overwhelming. It comes with two distinct parts; the first section outlines over-arching project information; the second part defines the detail of each phase and can be extended throughout the course of a project as each phase ends. In our guide on estimating projects we talk about three phases of estimation: It’s a good idea to start making notes for your statement of work in the ballpark estimation phase. When there’s uncertainty or ambiguity it creates tension because it creates the potential for there to be a gap in understanding over what’s been agreed. I've been in the industry for more than 15 years working in the UK at London’s top digital agencies including Dare, Wunderman, Lowe and DDB. The activities also include meetings, reports and communications. If there are things that need to be adjusted, then adjust them and make sure everyone’s aware of the changes. And it’s always embarrassing it the client brings up something that you’ve written in the statement of work that you’ve totally forgotten about. READ MORE on www.pmi.org If you don’t have a Master Service Agreement in place, you’ll want to include the kind of details outlined above in your statement of work. What’s really a waste of time and redundant? As a project manager, it’s in your best interest to have something that enables you to say, “But this is what we agreed” when you’re having a debate with a client over about whether your estimate for a banner ad campaign was also going to include a campaign landing page. Make sure everyone knows. We also use third-party cookies that help us analyze and understand how you use this website. for the format of a SOW is that it adheres to the coding structure of the Contract Work. However, the main difference between the two is that the SoW is mainly used externally by a company. What is a Statement of Work in project management? It will consist of several types of information when applicable: Every SOW forms part of the project planning process and the project charter. I’m Ben Aston, a digital project manager and founder of thedigitalprojectmanager.com. What is Statement of Work (SOW) in Project Management. It is also legally binding and must be approved by the project’s client before work can commence. I will do this by … SOW is used in cases when projects involve vendors and external contributors. If it’s too detailed, it can artificially constrain the project, so that you end up doing pretend work that’s not really needed, just because you said you would. So if you need a statement of work template, or you’re looking for a scope of work template, we’ve got just the thing! The statement of work is the project contract and sets and aligns expectations. If you try to save a cent - you will lose a dollar. Let's resume the rest of the article. The project scope defines all these questions and more so that there’s a shared understanding of a project. During quotation, done together with contract BEFORE the project is accepted and signed by client? A statement of work (shortened as SOW, SoW, or sow) is an essential component of a client-vendor contract. Are you Pro Member? Tallyfy is a product that simplifies and automates your business processes. The project charter is intended for use at the beginning of projects, after the statement of work has been signed off on. It’s the new and simple way to track business processes across your company. A statement of work (SOW) is a document routinely employed in the field of project management. Watch out though – remember all of that work you put into your plan? Statement of Work (SOW) is a formal PM doc that is aimed to define the entire project scope of work and clarify deliverables, costs, and timelines. Even if they were involved in architecting the statement of work it’s bound to have changed and evolved so make sure they’re fully aware of what success looks like and understand the activities, deliverables, and assumptions. For example, if you are the project manager of a software development project and a colleague of yours argues that you need to buy a software package in order to continue developing the project but you know it’s too expensive and not necessary, what would you do? You don’t want to bring up the statement of work, but when you do, it’s worth having done it properly. There are a few similar and related documents to SoWs that are often mistaken for SoWs, even though they serve different purposes. Documenting your processes using flowcharts might look pretty and nice – but you can’t run them. The Project Statement of Work is an input to the 4.1 Develop Project Charter process in the Initiating Process Group. It’s not good enough for just you to know the SoW. The MSA is a contract between an agency and a client in which both parties agree to the terms that govern future transactions or future agreements, like the statement of work. You’re the guardian of the project so if you’re not 100% confident on what’s being delivered, how is anyone else going to know? Statement of Work (SOW) : is also known as Project Statement of Work (to distinguish with Procurement Statement of Work) is a document including the high level description of the intended deliverables of the project. If you’ve already created a project plan or timeline and a project estimate, then the statement of work is the icing on the cake—it’s got all the juicy detail and ties everything together. You need to strike a balance of being just detailed enough; developing a scope of work that’s quick to produce, robust yet flexible, without creating something that’s so behemoth that it takes you two weeks to produce. Scope creep is when the scope of a project begins to grow, seemingly sneakily. Don’t discount the value of a statement of work for internal projects as well. The statement of work contains all the project details wrapped up in one document. The question of when is missing here. Let’s start with the basics: What is a SoW? Project scope is the extent, range, breadth, reach, confines, dimension, reach, realm, gamut, spectrum, or spread of the work that’s to be done. If the work statement is too vague, too broad, or too generic, it can leave room for multiple interpretations, which leads to trouble later in a project. Minimize the risk of misinterpretation from your client by defining the extent of the work to do, and quantifying it wherever possible so they don’t expect more than they’re paying for. It's important to understand that context before you carry on reading. We rarely know exactly how a project is going to go at the beginning of a project, so overly-defining it not only takes a long time to write and get approved but you’ll find it makes it difficult to pivot the project when necessary as you’ve defined away any flexibility. It can contain all kinds of detail to help with that alignment including detail around: In fact, you could put all kinds of things into a statement of work if you wanted—it’s just best to keep it as lean as possible. It must also specify timelines and define reporting responsibilities. The SOW then goes on to provide detailed information on the deliverables. The SOW begins with the Scope Statement that describes the completed project. The purpose of this post is to make the distinction between the Project Statement of Work and the Project Charter clearer. Requirements and Constraints. Pretty much—a statement of work usually refers to the document itself, whereas the scope of work is the extent of work that the document codifies and defines. To consent for cookies to be used, click accept. The project scope is essentially the “what” portion of the project planning process. The template is unbranded and uses generic MS Word styling to make it easy for you to brand with your own logo and edit content. Who’s hosting it and who owns the code? Get familiar enough with it so that you know the details without having to refer to it. After identifying the scope creep, try chatting the situation through with the client and give them some options: Assuming it’s more work, you should issue a change request – basically, an update to the statement of work that details what you’re going to do with a description of the change, explain how you’re going to do it with the revised approach (explaining what you’re doing differently from the original project scope), as well as the budget and timeline implications. So how do you stick to it and keep your SoW on track? It defines project-specific activities, deliverables and timelines for … Many people feel like the statement of work and the project charter are the same thing. This indicates what you are planning to achieve and must include sufficient detail to guide your planning. Processes relieve stress, make things predictable - and help you grow and become efficient. Put simply, a SoW, or statement of work is an agreement between a client and an agency, contractor, or service provider that defines what’s included within a project, and what’s not. When projects go bad, the first place that the client will reference is the statement of work, so if it’s not detailed enough, add in the detail. There are countless scope of work templates that you’ll find online for projects, but many of them are confusing and more than we’ll ever need for digital projects. Be sure to keep a copy of it on hand. It’s where you put the meat on the bones of the project, and as you do, you get an opportunity to flesh out the details of what you’re going to deliver in your project. Can you trade their request for a new feature by taking out something similarly sized? It would be great to hear your point of view! Make the purpose of the process clear so even if the specifics of the plan evolve, the statement of work is clear on how you’ll know if the process was a success. As a project manager, you are primarily interested in the deliverable. The example statement of work and an SoW template for you to fill out are available in the DPM Membership. Hereafter, for simplicity, we’re going to use the term statement of work. Finally, remember that projects that go off the rails often do so in the very early stages of the project when PM’s don’t want to rock the boat by raising issues when they should. They show the project managers’ clients and stakeholders how the work will be tackled. The statement of work is the project contract and sets and aligns expectations. 2. There’s never value in doing work simply because the statement of work dictates it – it should always create value for the project. If you’re too scant in the details, it leaves a lot open to interpretation so there’s flexibility to maneuver and pivot, but also opportunity for a client to try their luck in getting things included within the project scope that wasn’t included. The knock-on impact of being too flexible in the first few weeks of a project can be huge. Scope Of Work Example: Guidelines To Prepare An Effective Contract, How To Define An Agency Scope Of Work To Deliver Increased Value, Tactical Tips For Creating A Successful Deliverables-Based SoW, https://thedigitalprojectmanager.com/project-budget-cost-estimation-guide/#5-estimates-methods, Project Management Books: 20+ Best Books For Project Managers, defining what’s acceptable and what’s not. It ensures the project follows expectations and agreed-upon guidelines. A statement of work (SOW or SoW) is a document that spells out the work to be performed.PMI describes two kinds of SOW: project and procurement. It helps answer the questions; ‘what should I include in my statement of work?’, ‘how much detail do I need?’ and ‘where do I put all the project information?’. But I’d also refer you to my Project Planning post – here I suggest that you increase the fidelity of your plan (and definition of the scope) as the client demonstrates their willingness to move ahead with the project when they’re aware of the ballpark costs and timeline. document that lists all the work a supplier will do during a project A statement of work template agreed-upon between an agency and a client clearly defines what work to include within a project and what isn’t part of it. Log it in your project management software to make sure all relevant team members can access it.

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