What is a Statement of Work (SoW)?

A Statement of Work (SoW) is a formal project document that defines the scope, tasks, deliverables, timelines, pricing, and responsibilities for a service or project engagement.

It is often attached to or referenced in a Master Service Agreement (MSA) or used in the context of Request for Proposal (RfP) processes to ensure mutual understanding and alignment between buyer and service provider.

Why Is a Statement of Work Important in Procurement?

In service procurement or project-based sourcing, an SoW:

• Clearly defines what is to be delivered and when
• Sets expectations on roles, milestones, and deadlines
• Serves as a legal and operational baseline
• Minimizes misunderstandings, scope creep, and billing disputes
• Enables performance tracking and acceptance criteria

A well-crafted SoW improves vendor accountability and protects project outcomes.

What Does a Statement of Work Include?

A typical SoW contains the following sections:

‍

SoW vs. MSA - What’s the Difference?

‍

Think of the MSA as the “umbrella contract,” and the SoW as the “work order” under it.

Use Cases for SoWs in Procurement

• IT services (e.g. SAP rollouts, cloud migration)
• Marketing projects (e.g. campaign execution, design work)
• Consulting engagements
• Engineering or R&D services
• Software development and integrations

Conclusion: Clarity and Control in Service Procurement

A Statement of Work ensures clarity, transparency, and control when procuring complex or service-based projects. It defines not just what will be done, but also how success is measured – making it an essential tool for strategic procurement teams.