All parties involved in a system implementation must agree on a statement of work (SOW) before the project can begin. However, as with any lengthy contract full of complicated clauses and legal jargon, it’s easy to lose sight of key terms. Omission of these important provisions can cause budget problems later in the project.
SOWs from systems integrators (SIs) are especially complex given the technical nature of the work. Keep an eye out for these six key points in a statement of work to avoid eventual dispute or delay:
1. Service level agreement
A detailed list of expectations for the new system should be plainly stated within the agreement. Projected report run times, data storage capacity, and system outputs (reports, metadata, and spending metrics) depict a clear vision of the system’s ultimate functionality. This level of description gives all parties a tangible idea of what “finished” means.
2. Team member performance
An agreement needs to be established around the project management model. Predetermined governance ensures that service issues have an established mode of resolution. For instance, if an SI’s team is not performing as expected, can either party request team member changes? There should be a structured method of replacing a team member who is not performing. Document these details within the agreement, and the project will run smoothly with the best resources available.
3. Hours billed
An important clarification that is easily overlooked is the criteria for time that can be billed back to the company. It’s far easier to address this issue at the outset of a project. Travel time and expenses are typically included, but it’s smart to get specific parameters for the definition of travel time. For example, are hours spent in a car or on a plane billable? Ask for an estimate of expected working hours per week for each phase of the project. Each of these items, no matter how minor, will affect the project budget.
4. License details
The systems integrator should include a section detailing licensing agreements. Terms and cost of licensing should be outlined and agreed upon up front. Additional costs such as yearly maintenance and fees for future upgrades should also be listed. Without these items, ambiguity of ownership can cause problems when an organization needs to make further system changes or updates.
5. Variance agreement
Over time, changes in the business environment might necessitate alterations to the project plan. Be sure that all parties are updated on project revisions by explicitly requiring within the SOW that all changes be documented. If additional work is requested, a new work order needs to be created, signed, and added to the original agreement.
6. Project scope
Another critical stipulation to be included in the SOW is project scope. This section should list all of the vendor’s responsibilities and tasks, such as implementation/migration, testing, training, and support. This list will help determine when new work orders are needed. The project scope also sets expectations for the level of support with which the company will provide the vendor. For example, the company must be clear about how many employees will work on the project and which subject matter experts can be consulted for major decisions.
An SOW without these points can leave room for disputes on payment amounts, expectations, and other project details. By developing a detailed SOW, everyone involved in the project can focus on the critical path to completion. Trenegy helps companies successfully prepare for system implementation by ensuring vendor agreements are clear and comprehensive.