Why every consultant needs a high quality SOW.

25 Feb Why every consultant needs a high quality SOW.

Female swine aside, the statement of work (SOW) is often executed with a “check-the-box” mentality. Many consultants and vendors are missing a huge opportunity. I suggest that the statement of work (SOW) is one of the most, if not the most important tool of the consultant engagement. What is a SOW?  A SOW is a formal document that defines a consultant or vendor’s engagement with a client in terms of activities, tasks, and deliverables, and the timeline to be executed in performance of specified work. The SOW usually includes detailed requirements, specifications and pricing, and includes standard regulatory and governance terms and conditions.

The purpose of this discussion is to change your thinking about SOWs. Don’t think of the SOW as an unpaid, time-consuming, necessary evil.  Conversely, a SOW is a document full of opportunity and promise. The SOW is a document worth your investment in time and effort.

I will give you my top five reasons to invest in creating high quality SOWs.

First, the SOW is often the first piece of detailed client-specific work that the client team may see. The statement of work gives the client an idea of the state and shape of any interim and final reports.  Does it have spelling or grammar errors? Is it messy or unclear?  Is it cookie-cutter, sterile or perfunctory?  Is the tone demeaning or is it collaborative?  The document gives you an opportunity to put your best professional foot forward. If it is well written, the SOW will be referenced throughout the engagement providing clarity and increasing productivity.

Second, the SOW is a client touch point and an opportunity to stand out from the competition. As a vendor, you can communicate your unique value to the client within the SOW.  This is especially valuable if the client is evaluating several vendors or consultative solutions.  Each time the SOW is referenced, it increases the frequency of communication of your branded message, promise and unique value proposition to the client.

Third, the SOW document maps out stages, milestones and defines when the work is complete. The document creates shared expectations. Alignment around deliverables, objectives and goals helps avoid disappointment and project failure due to unarticulated client needs, requirements, and expectations.

Fourth, the SOW defends against unpaid incremental scope creep. The SOW outlines the scope of work, responsible parties, cost and time. If a client request falls outside of the description of work, the document frames the discussion and describes a change management process.

Fifth, the SOW defines the all-important payment terms.  As is often stated, no engagement is ever complete until the money changes hands.

It is a mistake not to take the time to conduct due diligence and create a high quality document when authoring a statement of work to submit to a client. He or she may not be paying for your time in developing this document, during this final part of the proposal stage, but the investment in your time will be returned with a smooth and mutually beneficial relationship with the client.  It serves to protect you and your client, and helps insure a positive engagement. Positive engagement results often lead to more business.

Now that we have discussed why the SOW is important, let’s discuss how to create one.  It’s not just ‘putting lipstick on a pig’.  (I had to say that.)   Here are some tips to putting together a high quality SOW for your next engagement.

Include the following elements in the SOW:

1. Background: Summarize the project background and objectives. Give the project a name. Use a naming convention, contract numbering system or account number for easy tracking and referencing. Include the client name, the client’s administrator, the expected start and end dates, and the estimated duration. Include work locations, client contact names, expected travel, and job description tasks. List specific deliverables and method of delivery such as written report, presentation, graphics, products, or consulting time.
2. Time and materials: Provide a breakdown of each type of task or phase of the project, estimate hours, man-days, or other, to deliver and provide an estimated total cost.
3. Schedule of rates: State whether the engagement is based on a flat fee, a fixed or a variable rate schedule. Define the rate(s) as cost per hour, man-day, week, or month of work.
4. Payment terms: Articulate how the job will be billed, the party and address to whom it is payable, and when payment is due. Is there a retainer or percentage due upfront?   Will there be payment at certain project milestones?  Be clear on the triggers for each payment. Fully describe the event, how to determine the completion date and when the payment is due.
5. Engagement related expenses: Describe how expenses, for the cost of doing business, will be handled, for example; travel, equipment, and supplies. State the party that pays for the expenses, how they are accounted for, and expectations around billing process and reimbursement.
6. Assumptions: List any detail that clarifies contingencies, participation from client personnel or other vendors, parallel work being done outside of the scope of the statement of work, or anything else that may affect the project.
7. Change management process: Describe the process that will be used should either party need to change the agreement.
8. Professional services agreement: Detail the general terms and conditions for services provided to your client.  Include who owns the product once the project is complete and how maintenance or upgrades will be handled and billed in the future.
9. Authorization and authority: Create a signature page that confirms agreement of the products and services to be delivered, when, how, and for what price. Include any legal language as required.  Get signatures from the client or client’s authorized administrator, the statement of work author, and any other parties who are responsible for the SOW.

Make it client specific.

Demonstrate to your client that you have done your homework, listened during the pre-proposal discovery meeting(s), read the brief or RFQ, conducted secondary research into their business,  and took the initiative to understand their needs.  Add the details to your SOW that support this understanding.

Brand it.

Be sure the document is consistent with your image, positioning, promise and the overall value you offer your client.  Any communication you have with your client, whether written or verbal, is a chance to communicate your unique selling proposition.  A note of caution here, avoid over selling.  Remember that the primary purpose of the document is to show how you solve their problem.  It is also important that it is well written and you proof it for consistency of message, style, grammar and punctuation.

The SOW is an important business tool.  Don’t miss an opportunity to maximize the effectiveness of this document and stand out from other vendors.  Your client will come to see your level of professionalism through your use of this business communication tool.  A quality SOW will help give you a foundation for a long-term, mutually beneficial relationship between you and your client.  It is attention to detail that turns a client’s good experience into a great experience.