A service level agreement (SLA) is a set of promises made by the supplier of IT services to their customer. It is a legal agreement that sets the expected level of service the customer will receive and usually includes penalties if those service levels are not meant.
An SLA will also contain a detailed description of the services that will be delivered and information about how those services will be delivered.
Primary Types of SLAs
Most SLAs fall into one of three different categories:
Single Service Agreements
Customer-Level Service Level Agreements
Single-service agreements are used when a company provides a single IT service to a customer, even if that service is provided to multiple departments. If a customer needs multiple services, the best practice is to have a separate SLA for each service. This avoids confusion when multiple services are being purchased.
Customer-level SLAs are most common when a single customer is contracting with a cloud service provider, and the customer will be using multiple, but related services. Each service will have a separate section of the SLA.
Multi-level agreements are a combination of a single-service level agreement, a customer level agreement, and a corporate-level agreement. This is used when a large organization contracts for IT services, and this agreement covers service issues for each “customer” inside of the large organization.
Do You Need an SLA?
Quick answer, Yes. SLAs are critical because they provide both the legal framework for the relationship, and they outline the expectations for both sides about the acceptable level of service. IT services are complex, and sometimes abstract.
The terminology can be confusing when the customer and the provider are using the same terms to mean different things.
The SLA helps both the customer and the provider move forward with confidence and clarity.
SLA Best Practices
One of the most important SLA practices is to make them clear. Because they are legal documents, any confusion may lead to expensive litigation. Beyond making sure that SLAs are written so they can be read and understood, there are two other important best practices:
Use SMART Goals
You want the SLA terms to be measurable because that provides an objective standard that both sides can understand.
You should use the SMART goal framework to create SLAs. This means that every service needs to be described in a way that is:
Align with Desired Outcome
The provisions of your SLA need to be tied to the desired client outcome. There is nothing worse for a relationship between a provider and a customer than a situation where the provider is meeting all of the metrics of the SLA, but still failing to provide the customer with the outcomes they want.
Abstract goals aren’t good enough. Every service needs to be aligned with a specific customer-desired outcome.
Because every customer will need different services and have different goals, each SLA will be slightly different. However, every SLA should have three provisions:
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