Defining the requirements in a statement of work
by Patti Magee
Government Procurement Consultants Ltd. (Ottawa)
This procurement tip will provide you with the do's and don'ts of developing a statement of work for your next contract.
The statement of work (SOW) forms the foundation of the procurement process, impacting every aspect. It is critically linked to every phase of the procurement lifecycle in that it is:
- the primary vehicle for alerting suppliers to a need and communicating to suppliers the work required;
- the definition of the contractor's obligations relative to the work to be carried out under the contract;
- the basis for the evaluation criteria in a competitive procurement;
- critical to interpreting the respective obligations of the parties to the contract and to mediating disputes.
A poorly-defined requirement could result in:
- more questions from bidders;
- the need to amend the solicitation;
- no bids or no compliant bids;
- poor quality proposals;
- cancellation and re-issuance of the solicitation;
- supplier challenges;
- delays in contract award;
- delays in related procurements;
- increased chances of misinterpretation;
- unsatisfactory contract performance;
- contractual disputes;
- higher contract administration costs; and
- questionable value for money for the public buyer.
A well-defined requirement is one that:
- can be understood by an informed lay person;
- clearly establishes the parameters of the requirement;
- articulates project objectives;
- establishes minimum requirements for performance and a means for measuring performance;
- links quality and desired performance to intended use;
- represents an effective balance between reflecting the organization's needs and establishing a level playing field;
- is not overly restrictive as to preclude competition;
- maximizes competition;
- includes a glossary where numerous technical terms are involved;
- includes deliverables; and
- considers the type of industry, the nature of the requirement, the effect of the competitive process, and the different legal liabilities when determining whether to define a requirement in prescriptive terms or in terms of performance.
Invest the time up front to properly define your requirement. Here are some tips:
- Conduct research. Review previous or similar SOWs, search the Web. Be cognizant of any shortcomings with the previous SOWs, and other problems encountered with the previous procurement.
- Put yourself in the shoes of the bidder. What information do they need to know? What knowledge do they already have? Are they familiar with the terms and concepts?
- Use Canadian and international standards and specifications where possible, e.g. Canadian General Standard Board (CGSB) or International Organization for Standardization (ISO) standards. Standards establish accepted practices, technical requirements and terminologies, and provide a sound quality base.
- Consult with legal counsel, who can assist you with proper wording and advise you of potential liabilities associated with including or excluding a particular provision.
- Consult with functional experts.
- Use standardized formats or templates to promote clarity. At the same time, be aware that each SOW must be tailored to the specific requirements of the particular procurement. Don't let a template get in the way of presenting essential information.
- And finally, be knowledgeable about industry's capabilities, practices, and products. Keep in touch with the supplier community through reading trade journals and attending trade shows.
For background details on Patti's expertise and Government Procurement Consultants Ltd., click here.
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