Statement of Work vs. Scope of Work: Key Differences

By Indeed Editorial Team

Published 7 June 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Organising a project includes numerous tasks, such as updating records, providing documentation and drafting written agreements between project teams and clients. A successful project is one where the project manager possesses complete knowledge regarding the various documentation that defines a project. Knowing the difference between a statement of work and the scope of work can help you manage a project more efficiently and provide an exceptional client experience.

In this article, we list the key differences between a statement of work and the scope of work and provide details on how and when you can use them.

Statement of work vs. scope of work

When comparing the statement of work vs. scope of work, there are a couple of elements that differentiate the two from each another. While they share some similarities, it's essential that project managers recognise the difference between them since they function in unique ways and serve distinct purposes. Here are the major differences:

Definition

A statement of work, or SOW, is a document describing the foundation of a project and the workflow necessary for project completion. An organisation employs a narrative structure while developing its statement of work, and this structure outlines various features of a project, such as the goals, activities, timelines and deliverables. A statement of work also includes different sections, providing details on pricing, terms and conditions, regulatory guidelines, vendor services and industry standards. Along with explaining the processes that could help a project succeed, they also describe the challenges the project might face, including budget problems, delays and execution disparities.

Scope of work is a part of the statement of work document that describes all the project processes step-by-step, explaining to the team what the project does and doesn't cover. It explains the project's requirements and how to meet the project's goals. The scope of work elaborates on the services that are imperative to completing the project, the members who would be providing those services and the specific tasks in connection with the project.

Related: How to Write a Mission Statement (With Template and Examples)

Objective

The objective or purpose of a statement of work is much bigger than the scope of work. A statement of work encompasses the goals and structure of a project, describing the deliverables and defining the project in great detail. Project leads outline the responsibilities of everyone involved in the project in this document while also highlighting other factors such as budget, timeline and additional requests.

The purpose of a scope of work is much narrower when compared to an SOW. The former is more oriented towards the tasks of individual employees and describes how they can complete them and the tools that could help them deliver the tasks competently.

Related: Project Dependencies: Definition, Types, Benefits and FAQ

Benefits and role

A proper workflow enables project managers to plan a project efficiently and ensure its on-time completion. An SOW is critical for project managers since it helps them supervise the work performed by everyone, including contractors, freelancers, vendors and developers. One of the most significant advantages of the scope of work is that the project manager can tailor it cleverly to address the needs of different individuals involved in the project. It tells them exactly what to do, how to do it and the deadline by which they're required to complete their tasks, thereby benefiting the employees and the stakeholders.

Length

Depending on the project, the length of an SOW could vary. As they contain various elements, such documents are often 12 pages longer or even more. The scope of work is much shorter since it's a single component within the SOW itself.

Related: 11 Essential Project Manager Skills to Include on a Resume

Elements of the statement of work

Project managers typically prepare a comprehensive draft of a project's SOW before work begins, and it's essential that all involved parties agree to the terms and conditions laid out. In most cases, SOWs are binding documents that project managers use to maintain contractual agreements with clients and settle any potential disputes regarding project implementation, workflow and payment. Below are some of the crucial elements you might want to add to your statement of work:

  • Purpose: The statement of work typically begins with the motivation and reasoning associated with the project and details components such as project objectives, deliverables and return on investment.

  • Scope of work: This section provides more details about the project, including a more comprehensive view of the tasks and the tools required to accomplish those tasks.

  • Location: The location section provides details on where the team members would meet, where they can perform their daily tasks and how team members can gain access to the essential tools required to complete their work.

  • Duration of work: This section explains the duration of the project you're about to undertake, the start and end dates, the total number of hours and the acceptable billable hours with regard to a specific timeframe.

  • Schedule of deliverables: The due dates of the deliverables in a project are also an essential part of the statement of work. It includes a detailed list of schedules related to the kickoff, review stage, development, implementation, testing and closing of the project.

  • Contractual details: This section elaborates on the discussions and negotiations between a client and project manager and lists the terms and conditions agreed upon and the type of agreement signed.

  • Industry standards: This section discusses the industry standards the client can expect the team members to meet while completing the project.

  • Payment: The payment section exemplifies the project's budget and shares how the clients can make the payments. It also highlights the predefined time frames when the client has to make the payments.

  • Guidelines for acceptance: Different clients might have different criteria regarding the approval of the final product they wish to create through this project. This section describes the acceptance guidelines of the project.

  • Special requests: Any special requests the project managers or clients raise during the project development phase can be a part of this section. For example, workforce requirements, special tools or even the eligibility criteria of team members.

  • Milestones: Mention the quantifiable milestones associated with the project. This could help divide the tasks into more easily identifiable sections, making it simpler for the members to meet their deadlines.

  • Miscellaneous: The miscellaneous section of SOW details any project items that aren't part of the negotiations between a client and project manager. Project managers may often list items of particular importance in this section to avoid oversight.

Related: 10 Different Project Charts for a Project Manager to Use

When to use statement of work and scope of work

While the scope of work is one of the components of an SOW, both these elements aim to serve different purposes. You may use both of these at various times during your career. Here's more information on how you can identify whether an SOW or a scope of work may be more appropriate to describe your project's goals:

Statement of work

An essential planning tool for project managers, an SOW helps them supervise a project from the beginning to the end. They use an SOW to create a blueprint of an entire project's goals, purpose, location, timeline, standards, deliverables, client requests, payment schedule and contractual details. In this way, an SOW is typically an in-depth document that summarises various project elements.

Scope of work

The primary use of a scope of work is to provide details about the different roles of the team members and the workflow that can help drive the project to its completion. Project managers can utilise a scope of work to help the employees understand the expectations of performance and contribution. They may also use a scope of work to designate time frames for the different milestones and work accomplishments.

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