BENEFITS OF STATEMENTS OF WORK

If you have ever been asked to review a failed or challenged project only to find that the situation could have been avoided by simply having a detailed SOW in place, then you can understand what a frustrating experience it can be. The frustration comes from realizing that millions, and possibly billions, of dollars could have been saved and the project could have been successful simply by taking time at the outset to properly document the work to be performed. In these situations, neither the government nor the contractor wins. The contractor will lose profit and the government will be dissatisfied because its expectations are not being met.

The benefits of having a detailed SOW can be enormous. They include the following:

•    A baseline for measuring change. One of the most important benefits of the SOW is its use as a baseline for determining and measuring change during the project. This is particularly true once the project moves into the execution or implementation phase. Without having a defined baseline to measure change, a project manager might never notice a change when it occurs, which would make change very difficult to manage.

•    A baseline for work completion and payment. If the SOW has been written correctly, it will identify in detail the work contracted for delivery. The SOW’s detailed descriptions, and any approved changes amending the original document during the project, should create a clear understanding between the government and the contractor as to what classifies completed work. The work should be considered complete only after the contractor delivers all products or services and the government accepts those deliveries. Upon acceptance of the product or service, the government can issue payment.

•    A method of recording, measuring, and analyzing products and services. The SOW provides the project team with a single document it can use to specifically address the products and services that will be provided to the government under contract. The primary supporting document to the contract, the SOW establishes the contractual baseline description of each product and service. Having a single document to reference eliminates the confusion that would result if these elements were captured in multiple documents. The team has to reference only one document to measure and analyze the actual work performed.

•    A baseline for audits. Without an established and agreed-upon baseline document, it becomes impossible to determine whether the work is actually meeting the agency’s requirements and specifications. It is also impossible to determine when a change occurs on a project. Without a baseline document, any changes made to the project during its lifecycle will not be documented and properly accounted for. Having an SOW in place allows the team to easily audit the project to determine where changes from the agreed-upon baseline have occurred, as well as the corresponding impact of the changes on project scope, cost, schedule, and manpower.

•    Defined roles and responsibilities. The SOW captures government and contractor roles and responsibilities for the work performed as part of the project. Doing so reduces the probability of future disputes between the parties as to who is responsible for the various elements of work. Clearly defined roles and responsibilities enable each party to properly plan and staff the appropriate resources required to perform the work, thus avoiding potential schedule delays and rework.

•    A snapshot of party agreements. In today’s fast-moving, dynamic marketplace, the makeup of project teams is constantly changing. Thus, it’s extremely important to have an approved SOW in place that captures the baseline description of the products and services scheduled for delivery at a specific point in time. Having the SOW in place helps avoid potential disputes between the various parties, particularly when the project team that made the original agreements changes. The SOW legally binds both parties to what was agreed to originally. It also provides a baseline document for the new team members, which they can use to institute changes that reflect the current needs and requirements of their respective parties.

The benefits of having a detailed SOW on a project are significant and far outweigh the costs associated with its development. Project failures can occur in any industry and any organization at any time. The amount of money lost or wasted on challenged and mismanaged projects can easily reach into the billions of dollars. Taking the time up front to develop a detailed SOW and using it to manage the project throughout its lifecycle will help avoid project failures. Doing so will also help projects to be delivered successfully and achieve a higher return on investment for the work being done.