MSA or Statement of Work?

About this interactive

When two businesses work together repeatedly, they split the paperwork in two. The master service agreement (MSA) holds what stays the same for the whole relationship, so it is not renegotiated each time: payment terms and late fees, limits on liability, required insurance, confidentiality (an NDA is often written into it), who owns the work, how disputes are settled and how either side can end the relationship. A statement of work (SOW), also called a work order (WO), covers one project, task or engagement: what will be delivered, the milestones and dates, the price, the scope and how the work will be accepted. One MSA sits over many SOWs, one for each job. Cost can sit in either place. A fixed project price goes in the SOW; standing hourly rates are often in the MSA or attached to it, as the lesson notes. To place a clause, ask whether it would still apply to the next project. If it would, it belongs in the MSA; if it is about this job only, the SOW.

What you'll learn

Place a contract clause in the master service agreement (terms that hold for the whole relationship, such as payment terms, liability, confidentiality and disputes) or in a statement of work (one project's deliverables, schedule, price and scope)

Aligned to

CompTIA Security+

5.3 Explain the processes associated with third-party risk assessment and management.

NIST 800-53

SA-4 Acquisition Process

NIST CSF

GV.SC-05 Requirements to address cybersecurity risks in supply chains are established, prioritized, and integrated into contracts and other types of agreements with suppliers and other relevant third parties.

Key terms

Master Service Agreement: An umbrella contract established between a service provider and a customer that governs the overall business relationship and under which future work or services are conducted.
Statement of Work: A document tied to a master service agreement that defines the specific tasks, deliverables, timeline, and costs for a particular project or engagement.

Topics

Statement Of Work Master Service Agreement Contracts Vendor Management Interactive Streak Sort

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