Statement of work is big business.
According to Staffing Industry Analysts’ estimates, companies spend $458 billion per year on contingent work via SOW globally. Some staffing firms are adding solutions business to their portfolio to command higher margins and get a more strategic seat at the table. That said, perhaps too often, work performed under an SOW is staff augmentation in disguise — that is, work that could otherwise be performed much cheaper, but is instead wrapped in the expensive veneer of an SOW. Unfortunately, clients don’t always know how to determine which is which.
Enter Deployed, a London-based startup that is trying to commoditize the consulting industry via technology by using data to analyze SOWs, deconstructing them into the truly strategic components versus the parts of the SOW that can be completed via a more efficient labor channel. “Companies tend to go for fixed-price consulting projects, but most SOWs have some parts that are very strategic and others that are more commodity, transactional work,” explains Emma Rees, founder and CEO of Deployed.
According to Rees, SOWs are often vague and not even fully defined until someone starts working on a project. They can also quickly inflate costs, because consulting firms may be hiring for job titles that aren’t required to achieve a project’s success. It can be difficult to measure this, however, because there is no common format for SOWs, and little sharing across firms.
The Deployed platform works by taking in SOWs from clients, which it then analyzes against thousands of similar SOWs accumulated via a confidential data exchange to understand the work actually being done, including job titles, roles, responsibilities and expected outputs. The platform sends back an optimized SOW that maps out which parts can be performed by various parties. Currently, the process is a combination of technology and raw data scientist power, though Rees envisions a fully automated platform in the near future.
Deployed’s clients are primarily large customers that purchase a lot of SOW business. Deployed charges a small spend-based fee — less than 1% — for the work that is optimized through the platform. It also has an “out-of-the box” solution for small to midsize enterprises, which is priced on an SaaS basis.
The firm, launched in 2017, already has some notches on its belt. Late last year, it secured a grant from Innovate UK and has worked with a number of large clients including Thomas Cook.
Companies spend hundreds of billions of dollars on SOW consulting, though it’s unclear how much of that is warranted. Deployed offers a data-driven approach to find out, and might just commoditize the consulting business in the process.