Question

In: Operations Management

What are the steps of developing an statement of work? What are the common problems in...

What are the steps of developing an statement of work? What are the common problems in writing an statement of work? What are the keys to managing changes to the statement of work?

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Expert Solution

First, let us look at what SoW (Statement of work) means. It is one of the most important documents in the project lifecycle. It describes the work to be provided by the service provider under the terms and conditions of the agreement identified in the document. It captures and defines all aspects of a project. SOW has following details available for the client to agree and sign:

- Scope
- Facilities and hours of coverage
- Change control procedure
- Additional terms/Derived benefit location
- Deliverables
- Definitions of services to be provided
- Service provider responsibilities
- Clients responsibilities
- Completion criteria
- Estimated schedule
- Charges
- Other (Any specific requirements to be addressed)

It also needs to be signed by the client to formally agree to the terms and conditions.

The steps taken to create an SoW are different in different organizations. Let me share the steps undertaken by my organization.

- Once the sales requirement has been presented and clients ask for a quote, the sales representative created a request for LOE and quote.
- A business consultant looks at the requirement and if the requirements are straight forwards, then we proceed to create a Scope of services (SOS) document which has the following details:

1. Product name
2. Services to be performed
3. Any conditions that apply to services being performed
4. Activities involved as part of the project
5. Charges
6. Any additional note

- Apart from this document, another document known as Service option attachment is created which has below details in it:

Deliverables
1. Definitions of services to be provided
2. Service provider responsibilities
3. Clients responsibilities
4. Completion criteria
5. Estimated schedule
6. Charges

- These documents are then presented to the client. Once agreed upon the documents (SOS & SOA) which are part of SoW are sent to the team which then processes the SoW for the client's formal agreement.

What are the common problems in writing a statement of work?

Writing a statement of work can have its issues. Some of them are outlined below:

- Scope creep: Making sure that the details are mentioned with specifics.
- Vague: Deliverables and completion criteria can be vague and not specific which can cause issues at the time of closure acceptance.
- Project assets or definition of services: Many details on the scope can be interpreted differently by different people. So having a language that keeps everyone on the same page is important.
- Change control procedure: Changes that can lead to scope creep happens because the changes are entertained without proper change control procedure being followed. Hence it is very important to have a proper and well-documented change procedure in place.

What are the keys to managing changes to the statement of work?

A documented and specified process should be followed if a change has to be brought in a project which is not part of the initial scope. The details should be specific with proper guidelines and procedures documented in SoW. A change authorization should be incorporated in SoW and it should be the vehicle for communicating a change to SOW and it should describe the change, the rationale for the change, and the effect the change will have on the Services. Also, a written change authorization and/or Project Change Request ("PCR') must be signed by authorized representatives from both parties to be effective and actioned upon.


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