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HOW TO WRITE A SOW IN PROFESSIONAL SERVICES

You just won a consulting project. Congratulations…what’s your next step?


If you said anything other than writing a statement of work (SOW), you’ve lost points. 


Whether it’s your client requesting one so they can review it before the project begins, or you’re looking to create one to make it easier to manage the project, a SOW in professional services is not just a formality. It serves as a roadmap for the project, keeping all parties involved on the same page and provides direction on what is required of both client and organization. 


This guide will examine the components you will come across in a SOW, and the steps you will need to take if you are writing one yourself, from defining the project scope to keeping on top of updates down the line.


WHAT IS A STATEMENT OF WORK IN PROFESSIONAL SERVICES?


A SOW in professional services, particularly within the realm of consulting, serves as a detailed document outlining the scope, deliverables, timelines, and other essential aspects of a consulting engagement. In the context of professional services, the SOW for consulting delineates the specific tasks, responsibilities, and objectives agreed upon between the consulting firm and the client. It acts as a comprehensive roadmap, guiding the project's execution and ensuring both parties are aligned on expectations. 


Although it can be easy to get them confused, and they may even share some similar steps, a SOW does differ from a project proposal, so if you want to write the latter, check out our guide here.


For SaaS implementations, a SOW might include details about software customization, integration with existing systems, data migration, training, ongoing support, and other aspects of the service being provided. It serves as a guide for the project and helps manage expectations to ensure a successful and mutually beneficial collaboration.


WHAT ARE THE KEY COMPONENTS OF A SOW?

A SOW is a comprehensive document that captures essential details of a project, ensuring a shared understanding between the client and the service provider. Key components of a typical SOW include a project overview, scope of work, deliverables, timeline, payment terms, acceptance criteria, change management procedures, and signatures. In the context of professional services, the SOW may also incorporate additional elements specific to consulting engagements, emphasizing collaboration, client engagement, and strategic alignment. Below is a breakdown of the key components commonly found in a SOW for professional services:


Project Overview: Brief introduction to the project, its objectives, and the parties involved.


Scope of Work: Detailed description of the tasks, responsibilities, and objectives.


Deliverables: Clear identification of tangible outcomes or results expected.


Timeline: Specific dates and milestones outlining the project's duration and deadlines.


Payment Terms: Detailed payment schedule and conditions.


Acceptance Criteria: Criteria for determining when the client considers the project or deliverables satisfactory.


Change Management: Procedures for handling changes to the original scope or requirements.


Signatures: Formal endorsement of the SOW by both the client and the service provider, indicating agreement and commitment.


HOW TO WRITE A PROFESSIONAL SERVICES SOW IN NINE STEPS


Crafting a comprehensive and effective SOW for professional services requires a methodical approach to ensure clarity, alignment, and successful project outcomes. In the following 10 steps, we outline a strategic process that guides you through the creation of a professional services SOW. 


1. Define the project scope


Defining the project scope is the first step in developing a professional services SOW. This section serves as the foundation for the entire document, outlining the boundaries and objectives of the project. In professional services, particularly within the realm of consulting, when defining the scope, clarity is key. It specifies the responsibilities of the consulting service, setting expectations for both parties involved. By clearly specifying what is included and, just as crucially, what is excluded from the project, potential misunderstandings are mitigated, and the risk of scope creep is minimized.


A well-defined project scope establishes the groundwork for a successful collaboration, providing a shared understanding of the project's objectives and boundaries. This section is foundational, as it forms the basis for subsequent details outlined in the SOW. Looking for more? Check out our five stages of project planning.


2. Identyify the deliverables


In this section, the writer outlines the tangible products and services that the consulting service will provide to the customer. Deliverables serve as concrete benchmarks that both parties can use to gauge the project's progress and success. In the context of professional services, deliverables can take various forms, from comprehensive reports and analyses to strategic plans and tangible assets. For instance, in consulting, a deliverable might be a service blueprint outlining the step-by-step processes and interactions involved in implementing a new strategy. Including a detailed list of deliverables in the SOW not only ensures transparency but also acts as a roadmap for the client, providing a clear understanding of what they can expect to receive upon project completion. Take a look below at some of the deliverables in professional services:


  • Service blueprints outlining process workflows.

  • Comprehensive reports on market analyses and trends.

  • Strategic plans for organizational development.

  • Custom software applications or tools.

  • Training materials and sessions for staff development.

  • Implementation of specific strategies or methodologies.


3. Create a timeline


A timeline serves as a roadmap, providing a structured plan for project execution and enabling both the service provider and the client to track progress. The writer establishes a clear schedule that outlines deadlines for each deliverable and ultimately for the project's conclusion.  It is crucial to set realistic and achievable deadlines, considering the complexity of each deliverable and potential dependencies between tasks. A well-crafted timeline not only enhances project management but also instills confidence in the client about the service provider's commitment to timely and successful project delivery. Clear milestones and deadlines facilitate effective communication, allowing both parties to stay aligned and make informed decisions throughout the project lifecycle.



4. Determine the payment terms


In professional services, the payment terms should be meticulously detailed to avoid any misunderstandings. This includes outlining a clear payment schedule, specifying the method of payment, and addressing any potential penalties or fees associated with late payments. This section establishes the financial framework for the entire engagement, specifying when and how the client will remunerate the service provider. By providing explicit details in this section, the SOW not only ensures transparency but also sets the expectations for both parties regarding the financial aspects of the project. Clear payment terms contribute to a smooth and mutually beneficial collaboration, fostering a positive client-service provider relationship throughout the duration of the professional services engagement. Billing is often an arduous task, and a poor process can cause errors in data entry and delays. Precursive is the answer to your billing woes, helping professional services teams to optimize every aspect of the billing process.


Billing in Precursive
Billing in Precursive

5. Establish acceptance criteria


By clearly defining the criteria that must be met for each deliverable to be accepted, the SOW acts as a safeguard against scope creep and potential disputes with the client. These criteria serve as measurable standards, ensuring that the deliverables align with the client's expectations and meet predefined quality benchmarks. Establishing acceptance criteria not only provides a basis for client approval but also serves as a guideline for the service provider, preventing project overruns and enhancing accountability. A well-defined acceptance criteria section contributes to a smoother project execution, fostering a collaborative and transparent relationship between the service provider and the client. If the defined acceptance criteria are not met, it can open the door to project overrun, potentially causing delays and additional costs. 


6. Outline the change management process


Change is inevitable in complex projects, and having a well-defined change management process is essential to prevent unforeseen costs, delays, and misunderstandings between the service provider and the client. In this part we define how any modifications or adjustments to the original agreement will be handled throughout the course of the project. By establishing a clear procedure for evaluating, approving, and implementing changes, the SOW ensures that both parties are on the same page regarding alterations to the project scope or requirements. This proactive approach enhances project adaptability while providing a structured framework for managing changes, ultimately contributing to the success of the professional services engagement.


7. Get approval from both parties


Clarity and alignment is key when it comes to writing a SOW. A comprehensive review of the SOW by all stakeholders will guarantee mutual understanding and agreement on the outlined scope, deliverables, timelines, and expectations. With approval from both parties, potential ambiguities are addressed, minimizing the risk of misunderstandings throughout the project lifecycle. This collaborative approval process establishes a solid foundation, fostering a shared commitment to the project's success and ensuring that the SOW serves as a robust contractual framework that accurately reflects the aspirations and obligations of all involved parties.


8. Store it in a safe and accessible location


Both parties involved should prioritize the establishment of a robust document management system to safeguard the SOW and ensure swift retrieval when needed. Consideration should be given to leveraging project management software, which can offer a centralized platform for organizing and tracking SOWs. This not only facilitates seamless access for all stakeholders but also enhances collaboration and transparency throughout the project lifecycle. Storing the SOW in a safe and accessible location serves as an essential practice, enabling swift reference, revisions, and compliance checks, thus contributing to the overall efficiency and effectiveness of the professional services engagement.


9. Update the SOW as needed


There should be an understanding within your organization that projects often evolve, and as such, the SOW must remain adaptable. Regularly updating the SOW ensures that it accurately reflects the current state of the project, incorporating any changes in scope, timelines, or deliverables that may have arisen during the course of the engagement. This flexibility is crucial for maintaining transparency and aligning expectations between parties, allowing for seamless adjustments to project dynamics. Whether prompted by unforeseen challenges, shifting priorities, or new insights gained during the project, updating the SOW serves as a proactive measure to keep everyone on the same page and mitigate potential disputes. 


TIPS FOR WRITING A SOW IN PROFESSIONAL SERVICES


We cover all bases here at Precursive, so to accompany our step-by-step guide on writing a SOW, we’ve included some of our top tips. By incorporating these, you’ll be able to manage expectations and set the stage for project success. 


For anyone looking to get more information on project management in the remote world, we have just the video for you! Watch our round-table event that saw a host of different speakers discuss changing demands on delivery teams, aligning customer success and project management, and much more.


Be realistic when it comes to the timeline

  • Set realistic and achievable deadlines for each phase of the project 

  • Consider potential challenges and build in buffers for unforeseen delays

  • Ensure the timeline aligns with the client’s expectations and constraints


Seek legal consultancy in complex situations

  • Engage legal experts to review and validate the SOW, especially in complex projects

  • Clearly articulate legal terms, including intellectual property rights, confidentiality, and dispute resolution mechanisms

  • Ensure compliance with relevant laws and regulations governing the professional services.


Encourage collaboration

  • Develop a collaborative environment by emphasizing open communication channels

  • Clearly define communication protocols and reporting structures

  • Encourage regular status meetings and progress updates to maintain transparency


Address risk mitigation

  • Identify potential risks and outline strategies for solving them

  • Include contingency plans for addressing unforeseen issues


Include a change control mechanism

  • Establish a formal process for handling changes to the scope, timeline or budget

  • Clearly outline the steps for requesting and approving changes to the SOW

  • Specify how any changes will impact the overall project and costs

 

STREAMLINE YOUR SOW PROCESS WITH PRECURSIVE PSA SOFTWARE


A SOW should go hand-in-hand with every new project. Turning it into a repeatable process will help to reduce scope creep and potential conflicts during the project lifecycle. It not only aids your internal processes but it also acts as a tool to increase customer satisfaction through improved communication. It serves as a reference point for both parties, creating a framework that not only guides the project's execution but also facilitates accountability and collaboration, ultimately leading to successful project outcomes and a contented client.


Precursive’s PSA software has a suite of project management tools that can assist when you’re putting together a SOW. 


  • Plan and schedule project tasks - With the help of Gantt Charts or Kanban Boards, you can keep everyone on the same page when it comes to timelines. Track in real time whether you’re staying on track and under budget.


  • Track progress, costs and schedules with real-time dashboards - Precursive’s project dashboard can track costs, progress and workload in real time so you can monitor SOW and swiftly decide whether your project team is delivering on time. 

Project Board in Precursive
Project Board in Precursive

For more information on how Precursive can help you with project management and creating SOW’s, book a demo now.


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