Why Perfect SOWs Create Imperfect Relationships
I always found the biggest challege wtih drafting statements of work (SOWs) is how to balance the details with flexibility. On one hand, we want to be precise to make sure every deliverable is precisely defined, every milestone is mapped out, and the acceptance criteria are bulletproof. On the other hand, the reality is that we don't know what we don't know.
Projects aren't static. Vendors and customers need some flexibility to make changes. The problem is that even small shifts can send the project in a direction away from what was originally scoped. Everyone wants to make sure those small shifts do not end up in a dispute over what the updated scope includes, who authorized what, and how costs will be covered.
In my experience, those very detailed and rigid SOWs are MORE likely to end up with the kind of issues the parties tried to avoid with that precision. This article explores why that happens and what we can do to prevent it.
The Counter-Intuitive Curse of Over-Specification
Many of us were trained to think that SOWs need to be very precise. Without precision, we'll have conflicts and problems. But that mindset misses three fundamental realities about service contracts.
- Professional services are by their nature imprecise. We often see shifts quality and tasks based on who is performing them. And that kind of change doesn't fit neatly in a very detailed SOW. In other words, the parties expect the project to be one thing at the start, but once the vendor starts performing, the parties may realize they need has evolved into something else. The more detailed the SOW scope, the harder it is to make those inevitable shifts.
- The parties may end up drained dealing with the conflict caused by having to document every small change. No one wants to be bickering all the time about the small, inconsequential details, but that's how it sometimes plays out with these strict SOWs. The vendor starts building change order costs into their pricing, and your business teams start hiding legitimate requirements to avoid the bureaucracy.
- Another problem is that over-specification starts the project with a level of distrust. Vendors can see that the customer doesn't trust them to do the right thing, so the vendors adopt the same distrust, too. We see vendors start to document every assumption, and resist any work that might be considered "extra." What should be a collaborative problem-solving relationship becomes a zero-sum game over scope interpretation.
Use a Framework With Precision Reserved to Manage Relevant Risks
To avoid those problems, we have to build in enough flexibility and avoid a one-size-fits-all SOW strategy. That's easier said than done, here are three factors to consider as you develop your approach are outcome measurability, vendor relationship maturity, and your internal change management capabilities.
Adjust based on the risk of this vendor performing this project in this current situation.
Here's my approach. Some SOWs require a more precise approach. These include first-time vendors, compliance-sensitive work, or projects where the business outcome is precisely known and measurable. I typically want to see more detailed scopes to protect both parties by establishing clear performance standards. But other SOWs don't need that level of detail and do better with frameworks. These SOWs address things like ongoing relationships, innovation projects, or work where the path to success isn't predetermined. In these SOWs, we focus on service levels, reporting requirements, and decision-making processes rather than task lists. Of course, most SOWs require a combination of those two strategies, especially when complex projects are involved. For these SOWs, we should define the discovery and planning phases in detail, then use milestone-based SOW amendments for subsequent phases. This gives us control over the critical early decisions while maintaining flexibility for execution.
After assessing the detail needed for this transaction, build your SOWs to anticipate and support those inevitable scope conversations.
Instead of trying to prevent scope discussions, create mechanisms that make them productive and non-adversarial. You can do this with a framework for the parties to make those decisions, rather than just taking a guess at what the right decision would be. This strategy works best when we include the business rationale behind scope choices, key assumptions, and any factors that would trigger reconsideration. When (not if) things change, you'll have a roadmap for productive scope discussions rather than debates about original intent.
Finally, make sure to create clear escalation paths with defined authorities
You need to be precise about who can approve different types of changes and at what cost thresholds. A $5,000 technical adjustment shouldn't require the same process as a $50,000 scope expansion. Build these details into your SOW so vendors know when they can proceed versus when they need formal approval.
When we look at SOWs as relationship management tools rather than just risk allocation documents, you actually get better legal protection. Scope disputes rarely arise from ambiguous contract language—they arise from communication breakdowns and misaligned expectations.
Why This SOW Approach Works Well
An SOW that facilitates ongoing collaboration creates a documented history of good-faith problem-solving, which significantly strengthens your position if a relationship does deteriorate. Courts and arbitrators can distinguish between legitimate business evolution and vendor overreach when you have a clear record of how scope decisions were made.
Most importantly, this approach transforms your role from scope enforcer to business enabler. Your business teams start seeing legal as a resource for managing vendor relationships effectively rather than an obstacle to getting work done.
The next time you're reviewing a SOW, ask yourself: "Will this framework help us make good decisions together, or will it force us into adversarial positions when things inevitably change?" The best SOWs anticipate evolution and create structures for managing it productively.
How to Contract's membership is designed to help you build real-world expertise with commercial contracts. Get access to our comprehensive system of live and on-demand courses, weekly lessons, detailed playbooks, and more. Join today!