Vendor Management: Write Statements of Work That Keep IT Projects on Track

Don't let contractors define their own deliverables. Negotiating detailed statements of work reduces project delays, cost overruns and even the likelihood of failure.

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  • Avoid references to sales documents such as proposals or RFPs. These documents may contain legal terms that could conflict with the services agreement. When specific content in these documents is relevant to the project, it should be revised and incorporated directly into the SOW.
  • Ensure the language in the SOW conforms to the services agreement. This means making sure terms defined in the services agreement are also used in the SOW. For example, SOWs tend to refer to work to be performed while services agreements frequently use the term services, and specify what the services are. Using different terms in the SOW creates confusion and may dilute a vendors obligations.
  • Consider breaking complex SOWs into several smaller, discrete SOWs. When necessary, a limited scoping SOW may be used to better define the requirements for a later SOW. For instance, you may want your vendor to perform an assessment to better understand your systems before you commit to a software implementation SOW. Scoping SOWs may also be useful if you want to change how payments are structured, such as converting a time-and-materials assignment into a fixed-fee engagement.

    By allocating sufficient time to draft clear and detailed SOWs, and by using your own language as the basis for negotiation, you can dramatically reduce potential disputes with vendors, more effectively control costs, and ensure that projects stay on track.

    Matthew Karlyn is senior counsel and Michael Overly is a partner with Foley and Lardner.

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    Copyright © 2010 IDG Communications, Inc.

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