According to Staffing Industry Analysts’ research, 90% of contingent workforce programs either manage statement-of-work (SOW) spend now or plan to do so in the immediate future. However, even for those already managing that category of spend, the scope is sometimes fairly limited. In numerous cases, respondents are reporting their SOW management process is strictly limited to tracking engagements; on- and offboarding SOW-related talent; and/or just processing a transactional, project invoice review and payment service.
This brings to light that go-live with comprehensive SOW management in a CW program may be an incremental affair at best — and for good reason. SOW management is “project/services” procurement and not just temporarily securing a skill set/managing staff augmentation. Hence, comprehensive SOW management is complex and will require some significant investments in program management technology, project content expertise and expert resources to provide support in sourcing the appropriate SOW service providers, assessing and designing the SOW project itself, managing project milestone signoffs and payments or administering contractual engagement requirements and change order actions, and finally, transitioning the acceptance/completion of the project/service being delivered. There are a lot of new capability requirements that do not exist in a standard staff augmentation-focused CW program resource portfolio.
Not all CW programs will attempt a comprehensive management approach when initially adding SOW management value to their CW program. Most might actually leverage the SOW service management expertise being built up by MSP solution providers in the marketplace.
The key is to define your SOW management scope based on your existing CW program’s capabilities (including, optionally, your MSP solution provider) to manage SOW engagements/service providers and then design and construct a SOW management business operation model that leverages that existing or soon-to-be-created capability investment. This might mean that initially a CW program can only simply track the SOW engagement activity and spend that is taking place in the organization. Or an MSP partner is offering a SOW provider (or engagement) management capability that is comprehensive in nature, giving access to a wide range of SOW service management process competencies. Specific SOW management capabilities are required to deploy certain levels of SOW management competencies.
The complexity of project/services engagement management can potentially limit even the most mature program. And remember, some mature programs may be well-established in the staff augmentation management practice, but not so well-positioned to manage SOW engagement spend.
Thus, an initially limited involvement in SOW management may be the best approach before taking on the return-on-investment (ROI) governance responsibility of major SOW project/services initiatives. Starting small with a limited scope, and additionally, managing the “tail spend” of the organization’s SOW engagement activity might prove to be a most effective starting point. Carefully proving a SOW management competency may serve as the best, operative change management plan, strategically. Scope the SOW management add-on program best on required governance capabilities which might, incidentally, not exist in the current CW program and need to be created and established before moving forward with any potential of success.