Statement of Work (SOW): What is it and How Does it Work?

Statement of Work (SOW)

What is Statement of Work (SOW)?

Statement of work (SOW) is a document used to provide details of a project. It covers  a project’s requirements such as project deadlines/timelines, payment terms and conditions.

Some people can mistake a SOW to a Master Service Agreement (MSA), but they are not the same thing. They work together to ensure expectations are met between the supplier and buyer. A MSA provides a simplification of a business relationship and a SOW offers job specific details.

STatement of WOrk (SOW) Management

While managing documents and expectations can get timely, writing the project agreement can be complicated. By partnering with a managed service provider (MSP), they can help managing these tasks through SOW management.  This type of management will help ensure that all projects are completed on time and on budget.

SOW Management will also help create any efficiencies, risk migrations, supplier management and essentially help with the overall success of the project.

The Different Types of Statement of WOrk (SOW)

There are three types of SOWs that companies use to define the scope of services:

Design or detail

This SOW tells the supplier how the project will be completed. It clearly defines the requirements to perform the task/project such as materials used, measurements, instructions, etc. This is usually used in government, constriction and manufacturing industries.

Level of effort

This type of SOW is also known as time and materials/unit rate. It simply defines the work hours and material needed to perform the project. This is flexible as it describes the service needed to perform of a given amount of time, which makes it often used in a contractor or temporary contractor setting.


This type of SOW focuses on the performance and defines the details of the projects purpose, resources, results expected and quality of work. This is the most flexible type of SOW as focuses solely on the outcome of the project and not the process. This I usually used in public and private sectors.

The Key Benefits of STATEMENT OF WORK (SOW)

Reduce Risk

SOW management can help you stay compliant with local, state, federal and international government policies and regulations as well as company policies.

Cost Savings

SOW management can help you save money by providing insight to key metrics and success factors to help you manage your budgets and timelines.

Program Analytics

SOW management can provide you with insights to budgets, expenses and SLA metrics to help showcase performance.

Providing SOW management allows for business leaders to have the tools necessary to make decisions easily and more productive. IT also helps eliminate unexpected circumstances and allows for projects to be delivered on time and within budget.

Interested in learning more? Connect us today to discuss how these services can benefit your business.