Simple Explanation of a Statement of Work (SOW)
- It's a detailed document that describes the specific work to be done for a project, often serving as an add-on to a larger, ongoing contract. It clearly outlines the services, the project's boundaries (scope), pricing, and deadlines.
- This document clearly defines the project name, its precise scope, the cost, the timeline, roles and responsibilities, how deliverables will be approved, the project duration, and the payment terms for the services provided.
- Often, an SOW is developed after a main agreement or overarching contract is signed, acting as the specific, detailed plan for a particular part of that larger work.
How Businesses Use Statement of Work (SOW)
In companies, sow are used to manage individual deliveries within projects and contracts, often covering larger scopes than simple purchase orders. A job specification is essentially a work order with detailed descriptions of the tasks. Job specifications are used for ordering services or deliveries that fall under a master agreement. Each work order outlines a specific service, such as “office cleaning in January,” “equipment inspection,” “employee training,” or “email service deployment” – all with clearly defined terms.
What a SOW Looks Like in Practice
It’s a document that:
- defines exactly what is to be delivered,
- sets the scope of work, deliverables, deadlines, and cost,
- assigns responsibility – who will deliver it and who will oversee it.
- Is typically attached as an exhibit to the master agreement
Unlike the master service agreement (MSA), which covers general terms, the work order is specific, time-bound, and focused on the outcome.
How Companies Use Statement of Work (SOW)
- Ordering supplies for projects and contracts
- Ordering larger-scale services with a delivery schedule
- Managing individual services within long-term cooperation or a project: For example, an IT company has a framework agreement with a client. Each project (e.g., email migration, VPN setup) has its own purchase order, or
- Ordering recurring services: For example, an office cleaning contract – a new purchase order (SOW) is issued each month with the date, scope, and amount.
- Statement of Work (SOW) serves as an attachment to the issued invoice: Each purchase order must be approved before work begins – this gives the company an overview of what was ordered and in what scope.
Statement of Work (SOW) Template for Download
- Statement of Work (SOW) in MS Word for Download (coming soon)
- Statement of Work (SOW) in PDF for Download (coming soon)
- Statement of Work (SOW) APTIEN for Download (coming soon)
