Honey the Hamster

Here you define the responsibilities of the service provider and the customer. However, there are several elements of an SLA that are consistent across all sectors and especially in the customer service industry. Good service starts with a clear understanding of the service to be provided. Without clarity, you are fighting against human nature to want more than you can deliver. Start by developing a service description by talking to your customers. What do they need? What are the critical requirements? It`s a great opportunity to see IT departments through their eyes. You will be surprised at what you discover. In addition to defining performance metrics, an SLA can include a plan to resolve downtime and documentation on how the service provider will compensate customers in the event of a breach of contract. Service credits are a typical remedy. For example, service providers may provide credits that correspond to the length of time they exceeded the SLA performance guarantee. A service provider may limit performance penalties to a maximum amount to limit the risk. Add the pricing models for each type of service with detailed specifications.

With service metrics, we know if the service meets the agreed service level. Unfortunately, far too often, they are little more than a continuous history of the figures reached. Things like: If you then look at each individual service in order, the customer needs to specify the expected performance standards. This varies depending on the service. Using the sample report above, a potential service level could be 99.5%. However, this must be carefully weighed. Often, a customer wants performance standards at the highest level. While understandable, in practice this could prove impossible, unnecessary or very costly. On the other hand, the service provider may well argue that performance levels should be deliberately set low to ensure that the service can be provided at a competitive price. It`s all a matter of judgment and the customer needs to carefully consider each level of service – it often happens that individual services are weighted differently based on their commercial importance. Performance standards for the availability of an online service are generally high, as it is crucial for the customer to ensure the constant availability of the service. Other individual services may be less important and service levels for these may be set at a lower level.

Human nature is a funny thing. Remember Economics 101 with supply and demand and all that jazz? I remember one thing very well: human desires are unlimited. Customers always want more. Here`s how it works. In business, it is against the limited supply, and the tension in the middle determines the price that the market will tolerate. It is an agreement, if you will. SLAs are thought to come from network service providers, but they are now widely used in a number of IT-related fields. Industries that have implemented SLAs include IT service providers and managed service providers, as well as cloud and Internet service providers. SLAs are an essential part of any outsourcing and technology provider contract.

In addition to listing expectations for the type and quality of service, an SLA provides remedies if the requirements are not met. A service level agreement (SLA) defines the level of service a customer expects from a provider and defines the metrics against which that service is measured, as well as any corrective actions or penalties if agreed service levels are not met. Typically, there are SLAs between companies and external vendors, but they can also be between two departments within a company. The SLA will also include a section that lists exclusions, i.e. situations where the guarantees of an SLA – and penalties for non-compliance with these guarantees – do not apply. The list may include events such as natural disasters or acts of terrorism. This section is sometimes referred to as a force majeure clause, which is intended to exempt the service provider from events beyond its reasonable control. Choose measures that motivate good behavior. The first objective of each metric is to motivate the appropriate behavior on behalf of the customer and the service provider. Each side of the relationship will try to optimize its actions to achieve the performance objectives defined by the metrics. First, focus on the behavior you want to motivate.

Then, test your metrics by putting yourself in the place on the other side. How would you optimize your performance? Does this optimization support the desired results? A Service Level Commitment (SLC) is a broader and more general form of an SLA. .