1. S TATEMENT OF WORK
(S OW)
PERFORMANCE BASED
CONTRACTING
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2. Statement of Work
Performance-Based Contracting
Performance-based contracting
involves structuring all aspects of
an acquisition around the purpose
of the work to be performed as
opposed to either the manner by
which the work is to be performed
or a broad and imprecise
statement of work.
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3. Statement of Work
What vs. How
• Lower costs
• Flexibility to achieve a solution
• Solution is the responsibility on the
contractor
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4. What Is An SOW?
A formal written description of your
minimum requirements to be performed by
a contractor
The “heart of your procurement”
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5. Why is a Clear and Concise
SOW Important ?
Provides a clear understanding of the requirements
Establishes a baseline for proposal evaluation
Reduces evaluation and negotiation time
Minimizes need for future changes
Baselines contractor performance measures
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6. Many Documents Are Based
On The SOW
SOW
NAFI QA R E P O R T IN G
C O S T E S T IM A T E S U R V E IL L A N C E R E Q U IR E M E N T S
PLAN
E V A L U A T I O N C R I T E R IA IN S T R U C T IO N F O R
S E C T IO N (M ) P R O P O S A L P R E P A R A T IO N
S E C T IO N (L )
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7. STATEMENT OF WORK
PROCESS OVERVIEW
The following is a summary of the recommended process steps for
preparing a Statement of Work SOW :
4. Establish a preliminary scope statement ( i.e., the purpose or
objective of your procurement)
5. List the tasks to be performed ( i.e., All performance requirements
you intend the contractor to satisfy, all requirements that the
contractor must comply with during contract performance )
6. Group similar and related tasks.
7. Organize the tasks in logical sequence
8. Identify the input ( Required resources to perform the tasks)
9. Identify the output ( Required results or deliverables )
10. Identify the timeline or frequency of the deliverables (output)
11. Develop the parameters for acceptable quality and performance
12. Determine how you will monitor the deliverables
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8. Statement of Work
Step 1
• ESTABLISH A PRELIMINARY SCOPE
STATEMENT THAT:
– Identifies the objective or purpose of the procurement
– Description of work to be performed
– Define the magnitude of work to be performed
– Defines the boundaries of performance and
responsibilities
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9. Statement of Work
Step 2
• List task to be performed that will:
– Accomplish the objective of the SOW
– Focus of “what” not “how” the contractor will perform
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10. Statement of Work
Step 3
• Group similar and related task
• Categorize tasks as either major or
sub-tasks
• Add any additional tasks as you
work through this
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11. Statement of Work
Step 4
• Organized task in logical sequence
– Chronological order
– Time-phase
– Discipline
• Ensure task required meet the minimum
requirements
• Delete unnecessary or repetitive tasks
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12. Statement of Work
Step 5
• Identify the required resources for each
task (input)
– May be labor, equipment and material
– May be NAFI or government provided
• Identify any operating restrictions or
procedures
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13. Statement of Work
Step 6
• Identify required results and or
deliverables (output)
– Meetings
– Reports
• Provides information to develop
oversight plan
• Contractor responsible for the work
(input to output)
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14. Statement of Work
Step 7
• Identify the frequency and timeline of
deliverables
• Assists in
– Refining SOW
– Method of surveillance
– Surveillance plan
– Cost estimate
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15. Statement of Work
Step 8
• Develop performance standard or acceptance
criteria expressed in
– Quality
– Quantity
– Time
– Appearance
• Should include elements such as “What, when,
where, how many times
• Should be appropriate for the contract and
– Necessary
– Realistic
– Objective and measurable
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16. Statement of Work
Step 9
• Determine how you will monitor the deliverables
• Must be appropriate for the contract
• Cost effective
• Methods include:
– 100% inspection
– Random sampling
– Periodic inspection
– Customer copleaints
– Review of progress milestons
– Reports by contractor
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17. Statement of Work
Conclusion
Lastly, the key factor in the success of the
Performance Based Contract is the ability
of you, the customer, to write good
requirements.
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Editor's Notes
A performance based SOW promises to lower costs for both the customer and the vendor, allows more flexibility in developing a solution to the customer ’s requirements, and places the responsibility for a solution that meets the customer ’s requirements on the contractor. A performance based SOW promises to lower costs for both the customer and the vendor, allows more flexibility in developing a solution to the customer ’s requirements, and places the responsibility for a solution that meets the customer ’s requirements on the vendor.
SOWs must reflect the full requirement to include a description of the work to be accomplished, the outcomes or deliverables, any NAFI/Government information to be provided the contractor, All other documents must be consistent with your SOW. We will go into this a litlle later, however some examples are the evaluation factors/criteria, instructions for proposal presentation,
Amendments during the solicitation and evaluation process Ensures ease of administration – lessens possibility of misinterpretations of requirements. Additional cost as a result of inadequate specification
All areas of the RFP are directly related to the SOW. Refer back to the Acquisition Plan and all the elements that were developed
The scope of work of your SOW should identify the objective or purpose of your procurement, and should define the magnitude of the work to be performed. It should also define the outside boundaries of the contractor ’s performance responsibilities. This becomes important during contract performance in determining whether additional tasks or work is considered within the scope of the originally planned responsibilities or is considered new work.
Now you should identify all tasks that may be required to accomplish the objective or purpose of the SOW. The tasks should focus on what the contractor will be required to do rather than how the contractor should accomplish the effort.
From the list of tasks generated, now identify the major tasks and sub-tasks. You need to group similar and related requirements; make sure you separate the major tasks from one another and list the sub-tasks under their appropriate major task. If you find that additional tasks (i.e., major or sub-tasks) are identified as you group and categorize, then add them to your outline accordingly.
The major tasks and their corresponding sub-tasks must be arranged in a logical sequence (e.g., chronological order, time-phase, grouped by discipline or task, or some combination). This is a good time to make sure all the tasks required to meet the NAFI ’s minimum requirements and successfully perform the contract have been identified. Repetitive orunnecessary tasks should be deleted at this step.
You need to identify the required resources (the input) for each task in your final task list. Inputs are the resources such as labor, equipment and material that are necessary to perform the task(s). The identified input will assist you with developing your list of NAFI furnished property and cost estimate. You will also need to identify any NAFI furnished property that is not necessarily associated with a particular task but that will provided as a part of the contract (e.g., office space, telephones, etc.).For NAFI furnished property that involves equipment that is being provided to the contractor, you will need to identify the proper nomenclature, quantity, serial number and estimated value for each item that will be provided as NAFI furnished property. In addition, you will need to identify the condition of the property (e.g.,good/ready for use, needs repair, etc.), physical location and when the property will be provided to the contractor. You will need to identify any restrictions or operating procedures (force protection level, hours of operation )that must be complied with when facilities are provided. The NAFI furnished property information will be included in your acquisition/purchase request package and will be used by your contracting officer to prepare the solicitation.
You need to identify the output for each task in your final task list. Outputs are the services (or the results) provided by the contractor and also deliverables such as reports, software, designs or hardware. The identified output will help you develop your SOW, surveillance plan (if appropriate), reporting requirements and cost estimate. Remember, the contractor will be responsible for the work (transforming the input into the output). Therefore, the output, should not, to the maximum extent practicable, include procedures, methods or processes. The outputs should identify all deliverables required. These deliverables should: 1) Be necessary; 2) Meet the minimum needs of the NAFI; 3) Be identified in the quantity required; and 4) Have delivery schedules specified. Reports should be limited to data which are essential to manage and monitor the contract (e.g., Labor Management Report, Quality Control Report, etc.) or those which are the purpose of the contractor ’s performance (Final Technical Report, Environmental Impact Statement, Certifications, Permits, etc.). If you are procuring commercial services, then required reports should be limited to those normally required in commercial business.
You need to identify how often each output will be furnished. The frequency of some of the outputs will be easy to count or quantify (monthly reports) while others will not (computer systems contract, respond within 2 hours of notification- you will never know in advance the frequency). You may use any available historical data plus projected changes to estimate how often the contractor will be required to furnish the output. If this procurement is for commercial services, you will need to consider what the standard practices are in the commercial marketplace. You may have found out how often the outputs are provided in the commercial world while conducting your market research. The frequencies of the output will assist you with developing your SOW, method of surveillance, surveillance plan (if appropriate) and cost estimate. Potential contractors will need to know how often the outputs are required so that they can understand the magnitude of the work and can propose a reasonably accurate price.
Performance standards or acceptance criteria may be expressed in terms of quality, quantity, time, appearance, etc. and should include elements such as “what, when, where, how many and how well. ” These standards do not need to include all of these elements only those that are appropriate to the acquisition. Performance standards or acceptance criteria should be: Necessary Realistic Specific and to the greatest extent possible: verifiable, objective, measurable The use of objective performance standards is emphasized since they are easier to enforce than subjective standards when the contractor ’s performance is unsatisfactory. Objective standards eliminate personal biases and normally are not subject to different interpretations.Performance standards or acceptance criteria are those performance levels or criteria that a contractor must meet to be considered acceptable during contract performance. These standards and criteria identify what the contractor ’s performance or deliverable product will be measured against. The standards or criteria may be published or recognized industry-wide standards or may be developed by you and tailored to identify the results needed for your procurement. Selection of performance standards or acceptance criteria is critical because they directly affect the cost of service. Therefore, you have to consider the potential cost verses the benefit of the standard or criteria.
Some form of surveillance is necessary to determine the acceptability of the output. The method and extent of surveillance will depend on what is minimally necessary to ensure the contractor complied with the performance standard or met the acceptance criteria. Careful selection of appropriate surveillance methods enables you to determine the amount of resources and associated costs needed to monitor and measure contractor performance. Surveillance may be accomplished by various methods such as 100 percent inspection; random sampling; periodic inspection; customer complaints; review of progress/milestones reports (accomplishments or activities completed) interim or final reports; or a comparison of the delivered output to a set of acceptance criteria.As you develop your final SOW, keep in mind how you might what to monitor and measure performance or deliverables to determine acceptability.
