Whilst Statement of Work (SoW) has been utilised for outsourcing projects and work arrangements by many major firms for many years, it’s only relatively recently that an increasing number of organisations – of varying sizes, across different industries and sectors – have adopted the model.
In this article we discuss the evolution of SoW, and why it and its multitude of benefits are having a growing influence on companies, their ways of working and how they manage projects to get work done.
A brief overview of Statement of Work (SoW)
A Statement of Work (SoW) is a contractual agreement between two parties – typically these are an organisation that requires something doing (a piece of work, a project etc) and a third-party provider of project-based services.
The contract defines the type and scope of work that the third-party will provide, in line with the organisation’s project requirements, and outlines specific details such as project objectives, timelines, milestones, deliverables, required resources and terms and conditions that the third-party are committed to working to.
As an example, at Impellam Project Services we use SoWs to agree how we are going to break down and deliver each part of a project that we will then deliver to the customer; from consulting and advisory, to a full end to end project delivery.
For a detailed insight into what Statement of Work is and how Impellam Project Services specialises in delivering on projects through SoW agreements, check out our ‘What is Statement of Work?' guide.
The Evolving Use of Statement of Work (SoW) Models
For many years, Statement of Work was a model used mainly by a handful of large management consulting and outsourcing firms; companies that traditionally worked on perceived ‘large-scale’ projects, providing advisory, consultancy and resource services
Today, however, due to several factors that have changed the way that businesses operate and how (and where) people work, the SoW landscape is now very different.
For example, in recent years, the global pandemic forced companies to quickly assess the way they operate, adapt new ways of working and adopt a more agile, digital-first approach. In response, people reassessed their work (and life) aspirations and how and where they wanted to engage in work. The rise of the ‘gig economy’ has seen many professionals become accustomed to, and prefer, shorter-term, project-based work over traditional 9am – 5pm permanent employment.
What’s more, as technology advances and the use of technology continues to explode, there is a constant need for new skills, knowledge and expertise. But this need for specialised skills has made for a highly-competitive talent market, with companies finding it difficult to find and hire people – and therefore cope with and react to changes in tech, consumers, markets and within their industries.
With many organisations lacking the bandwidth or budget to respond to such changes and challenges internally, there has been a wider shift towards project delivery through a Statement of Work as a way of ensuring companies and their critical projects – no matter their size or specialism – remain efficient, adaptable and focused on their required outcomes.
Why more organisations are embracing the power of SoW
In the face of potential recruitment and workforce challenges, as well as the limitations of alternatives such as hiring and managing contractors – which can be time-consuming, complex and expensive, involving numerous contacts and agencies – organisations are embracing Statement of Work as a much more effective, measurable and focused way of achieving their objectives.
Simply, SoW is having a growing influence on the way work gets done, and by who.
This is because, under the terms of its agreement and scope – defined in line with the specific requirements of an organisation and its project – a Statement of Work provides:
- Expertise, knowledge and experience - pre-formed teams of people chosen specifically for a project, ready to hit the ground running.
- Defined targets, objectives and deliverables - the project team works towards co-created set end-goals and outcomes from the outset, ensuring accountability throughout.
- Compliance - engagements are procured as a Service, with the correct governance and regulations in mind.
- Control and scalability - if, as and when required, businesses can scale up or scale down resources in line with the evolving demands of their project.
- Potential for better ROI - a focused, streamlined approach to a project can help prevent unnecessary expenditure, structure and control costs and drive-up returns and profitability.
The market shift towards Services Models
The increasing implementation of Statement of Work is part of a wider market shift towards a Services model. Services Procurement Management, for example, is another model that’s changing the way organisations manage their work and suppliers to achieve their goals.
The services model trend has been largely driven by companies taking the step change toward paying for – and benefitting from – specific services and outcomes, rather than potentially unpredictable drawn-out traditional hiring and contracting solutions.
With this global market change, the traditional resourcing and management consultancy industries are moving closer together than ever before, with more traditional resourcing companies having made the natural step up the value chain and have invested in and are providing their own professional project management and project governance services. As the space between resourcing and consultancy narrows, the gap in the market for services models widens.
As a result, there is growing potential for Statement of Work and other services models to become the preferred option for project delivery, especially in cases in which the desired outcomes – and the route to them – must remain fixed and focused throughout the project lifecycle.
Partnering for success with Impellam Project Services
In the face of complex challenges and project pressures, organisations are increasingly in need of the support of trusted partners who offer agility, scalability, and proven results. At Impellam Project Services, we are a results-driven delivery partner. We specialise in three key markets:
Our teams of industry experts bring real-world experience in delivering complex projects for both private and public sector organisations. Whether you need to scale quickly, de-risk transformation, or drive measurable impact, we have the expertise to help.
Success isn’t just about completing projects; it’s about driving tangible business outcomes. Impellam Project Services helps organisations navigate disruption, execute change, and achieve sustainable growth.
Take a look at some of our recent work and contact us for a discussion around how Impellam Project Services could support your business.