Statement of Work in Software Development (SOW) : Aalpha

Statement of Work in Software Development (SOW

The software development project’s process can be complex. Without clear planning and set guidelines, meeting the desired goals and results can be hard. Especially on matters of budgeting, you can have a set estimate, but the software development project ends up taking costs exceeding the set budget. Again, on matters meeting the timeline, some elements and concepts might come up that extend the desired timeline to finish the project.

These are among the many other things that can go wrong in the software development process without proper planning. But then, how can you collaborate with your software development partner and ensure all the goals and objectives of the project at hand are met? That is where SOW- statement of work in software development comes in.

This guide digs deep into the statement of work in software development. Keep reading to understand everything revolving around SOW and how you can ensure your next software development project becomes successful with SOW.

What is the statement of work in software development?

Also known as Scope of Work or Deliverables, an SOW is a detailed document explaining the terms and conditions of the project at hand between the project owner and the service provider.

It is more of a streamlined map guiding the project management team on the steps to follow to ensure their goals and your goals align. SOW is one significant document that defines successful collaboration. Again, it acts as a solid project management tool to build trust, minimize misunderstandings, and ensure timely delivery of the project.

Ideally, with a SOW, you will get what you asked for as a client because the document defines the following:

  • Goals and objectives of the project
  • Highlighting and handling responsibilities where necessary
  • Harmonizing the project’s expectations with the service provider
  • Cutting down on scope creep risks
  • Evaluating the project’s details and the budget alignment.

Types of SOWs in software development

A statement of work is a document that cuts across different industries and fields. Therefore, it is essential to select one that aligns with your industry or the type of project at hand. Below are the three types of SOWs.

The design/ detail SOW gives accurate details of the requirements, the steps a service provider must follow, and the actions the vendor should take to ensure the success of the project. It defines the materials to be used, action plans, and quality & measurements of the materials, among other concerns. Here, the clients take the bigger risks since the service provided has to meet the set requirements.

This form of SOW focuses mainly on the set time required to deliver set services. It, therefore, defines the materials required to accomplish the task and the hourly fee the client should pay.

This is the most flexible SOW. It defines the resources & equipment provided and explains clearly the aim of the project. It focuses more on the quality of service delivered instead of the processes used. The project managers, therefore, have all the freedom to plan and execute the project management actions.

Purpose of SOW in software development

A statement of work in software development is a key document. It describes everything in the project scope, the agreement between the service provider and the project owner, liabilities, and responsibilities. With a statement of work in software development, all sides will feel satisfied once the project is over.

It contains key elements on the project dynamics, payment details, expected standards/quality, goals& objectives, timeframe, and deliverables. The best part is that you can fine-tune and adjust the details to suit your business requirements.

Therefore, the main purpose of SOW in software development is to ensure transparency and collaboration between the client and the service provider company. This ensures there are no misunderstandings during the project development process. It is more like going on a journey where every member onboard knows the aim of the journey, the final destination, and the route to follow. So, an SOW in software development walks the client and the service provider through the product development life cycle.

What to include in SOW in Software Development

For a statement of work in software development to be complete, make sure you include the following details:

  • Introduction
  • Purpose of the SOW
  • Scope
  • Location
  • Tasks
  • Milestones
  • Deliverables
  • Timeline
  • Quality & testing
  • Success
  • Requirements
  • Payments
  • Miscellaneous
  • Conclusion

How to write SOW in software development

Having highlighted what should be included in an SOW for software development, below is how you should write each step:

The introduction of an SOW should clarify the general information concerning the project and the goals you want to achieve.

Include basic information that will enable the service provider to have a clear picture of what you need. Don’t forget to include details of the parties involved in the entire project for transparency reasons. Finally, the date and location where the SOW was created are key aspects in the introduction section.

Of course, you must have the reason why you need to create a specific product or, rather, what to accomplish for a given project. Therefore, the service provider ought to understand the reasons why the project is important to you and why you want to accomplish it.

Therefore, explain the long-term goals you want to achieve and how you plan to execute the processes until you succeed.

When writing the purpose section of an SOW, be detailed enough to enable the service provider to visualize what you want in the end. This will ensure your goals and those of the service provider align, hence walking on the same page and pace as you target the same results.

This section of an SOW in software development requires you to outline all the work that should be done. To simplify the process, you should describe the scope of work in phases, i.e., discovery, design, development, and testing.

Depending on the magnitude of the project, you can opt to split it more to establish a seamless workflow.

Among the key concepts to include in this section are the

  • Budget
  • Deliverables
  • Timeframe & milestones
  • Required tech skills
  • Parties involved (team members, project managers, and stakeholders)
  • Specs & limitations, any arising issues
  • Security concerns & how to assess and act upon security threats
  • Roles & duties of the participants.
  • Operation’s location

Well, we have different models of software outsourcing, with nearshore and offshore being among the popular models. It is there significant to highlight the place and time where the whole process will occur.

In the software development field, it is possible to work with a team located in a different region with varied time zones. Highlighting all these details in an SOW in software development will help clear communication issues and engagement, ensuring seamless collaboration between the parties involved.

In this section, you have to include an action plan of how the entire process will be achieved. Include tools, resources, and technologies required to enhance the project’s success. Therefore, you should define the following:

  • Protocols to be observed when adjusting the development process
  • Standards required when testing
  • Frameworks and programming languages to be used
  • Project management and communication platforms
  • Software development standards in the industry
  • Penalties in case of late delivery or poor quality and bonuses for exceptional work
  • Software and hardware for the development and testing process

These details are key to ensuring you set a solid foundation for your project. Besides, you will be in a better position to cut down on excess miscellaneous expenses.

In this section of an SOW, think of the timeline required to accomplish the task. Having a predefined timeline will help you maximize the resources while cutting down on costs. Therefore, define the starting date, the actual duration, the timelines, and the delivery date.

You can include milestones with tasks and activities to accomplish with their respective budgets. This will create a smooth environment to monitor and manage the progress, ensuring everything is on track and all the resources, especially time, are put into use.

You can also highlight the duration you want the contract to last to ensure you stay within your budget and within the set deadline.

Of course, you will need to take part in the whole process of software development. Your involvement will help you understand if the processes are perfectly executed and if all the phases are initiated keenly.

Therefore, it is key to define the involvement ways which you are comfortable with. In the SOW in software development, highlight the platforms through which you will initiate meetings and calls and review the progress. Also, remember to include the reporting channels through which your service provider will use and tools for tracking the progress.

Once the project is done, how will you measure its success or failure? How will you acknowledge the service providers did justice to your project?

In this section, you should highlight the elements that show the success of the project. Let the service provider team understand the nature of the final product you will pay for.

Don’t forget to include a sub-section describing circumstances in which you might be forced to pay half the amount, the whole amount, or close the contract without paying. Of course, you may feel dissatisfied with the product delivered, thus a change in the payment agreement.

Detailing this section in a SOW in software development will save you from spending more due to unpredictable events.

Okay, this is one important section of a SOW in software development. Defining the contract terms and model of payment will help evade a bad relationship with your service provider.

Depending on the scope and type of your project, you can select from two models of payments as described below:

The dedicated team model of payment is perfect for a long-term, complex project that doesn’t have clear project requirements. A good example is DevOps software development projects.

These types of projects require adjustments here and there during the development process. The features and requirements keep changing. Therefore, you simply pay monthly to account for the time the service providers have been handling your project.

Contrary to the dedicated team model, the project-based model often has clearly defined timelines and project requirements. It is upon the service providers to ensure their work processes align with what the client wants.

In this model, there is no flexibility, and you have limited control over the activities that take place. The payment terms are based on fixed terms where you pay the agreed amount once the service providers finish with the project.

Before you select your preferred payment model, make sure it is okay with the service providers as well to avoid conflicts during the development process.

The SOW in software development helps cover every single detail pertaining to your project. That is why the miscellaneous section is key, as it helps you cover any other detail you deem crucial in relation to your project. These are the details that aren’t covered in any of the other sections described above.

Examples of the details to include in this section include the following:

  • Warranties and liability limits
  • Ownership of the code
  • Post-launch support
  • Security concerns and regulations
  • Team structure for software development
  • Any missing administration details

These details will ensure the create a smooth collaborative environment with your service providers, ensuring the success of the project later on.

Who should write a SOW in software development?

Since a statement of work in software development is a crucial document, anyone involved in the project can prepare it. However, the person writing the SOW must understand the nature of the project at hand and have adequate experience writing detailed SOWs that will create a seamless collaboration between the parties involved.

Tips to help you write a comprehensive SOW

Are you in the process of writing a statement of work for software development? Well, use the following tips:

  • Keep it simple for easy understanding and implementation of the guidelines explained in the SOW
  • Make it visually appealing by adding some charts, diagrams, and drawings. This helps the service provider understand your software development project better.
  • Take note of misinterpretations, as they can change the whole idea stipulated in the SOW.
  • The legal part is key. Of course, you will require an abiding contract that lawyers can use to protect you against any cases that arise in relation to your software development project.
  • Always negotiate with the parties involved first to ensure you create an SOW that aligns with the agreement between all the parties to avoid conflicts along the way.
  • Take note of the dynamics of your software development project. Different projects are unique in their own way; therefore, the SOW should define that unique aspect of your project.
  • Divide the project into phases, especially for bigger projects, for easy management of the SOW.
  • Always have predefined objectives and goals you want to achieve.


An SOW statement of work in software development is a significant document in ensuring a smooth collaboration between the parties involved. It details everything about the project, from planning to execution of actions until all the parties involved achieve the set milestones and goals.

Therefore, if you want to cut down on unnecessary costs for your software development project while monitoring the progress at every step, prepare a detailed SOW that aligns with the nature of your software development project.

Any queries? Connect with our software development company : Aalpha information systems!

Originally published at on February 26, 2024.



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