What is an SLA and Why Should My IT Provider Have One?

An SLA – or service level agreement – is the way you hold your service provider to account. Getting them right is, therefore, essential to ensuring you get the service you need – and will mean that you have the necessary mechanisms in place if things do go wrong.

When we hear from companies who want to switch their IT service provider, they often tell us that their current provider takes far too long to get back to them or they have no idea how long they can expect to be waiting. Slow response times aren’t only an issue in terms of fixing a problem, but also in keeping people and systems updated. For these companies, the importance of defining clear and appropriate SLAs is well understood. That’s one of the reasons they come to us.

But what if you haven’t used an IT service company before?

Service outsourcing is a great way to buy in professional services at a fraction of the cost of employing someone or having a full-time department in house. It can also be a good way to access skills and expertise you may otherwise find difficult to identify or source. And, of course, it’s a way to get extra support during big change projects or other periods when you need additional IT support.

Not all IT Support is the same so, if outsourcing IT is new to you, we don’t want you to have to learn about the necessity for clearly defined SLAs the hard way.

That’s why we’ve produced a guide to explain how to get excellent service from your IT company. And SLAs play an important role in it.

What is an SLA?

An SLA is simply an acronym for “service level agreement”. This is a mutual agreement you make with your outsourced service provider. It defines the parameters in which the service will be provided and sets the minimum response times and essential service qualities for each service that is being provided.

The service level agreement should also outline the penalties that will apply when either side fails to live up to their part of the agreement.

Why is it so important to have SLAs?

Think about one of your business-critical systems. How much difference would it make to your business if it went down for fifteen minutes? What about two or three hours? What would be the consequences if you couldn’t use it for a whole day?

This will give you an indication of why getting your SLAs appropriately defined is so important.

Of course, there may be some business systems that aren’t so critical and these would need separate SLAs defining for them.

Not all SLAs are the same

Just as your RTOs and RPOs differ for service or technology, so must SLAs. If an IT provider has provides them to you, they will help prioritise requests into severity levels, usually: system down; critical; urgent; important; monitor; informational. Each severity rating will have a different response time associated with it.

Defining accessibility to assistance

Within the SLAs, it is usual to cover the different times and methods of contact. Your provider should be clear on how and when you can contact them and how quickly you can expect a response.

This could include:

• Time of day these channels are available

• Waiting times (per channel, time or severity)

• Maximum first response time

• Maximum response time

• Maximum delivery time after order placement

Performance monitoring and penalties

Another key element of SLAs is the definition of penalties that will be applied should service does not meet the agreed levels.

Your service provider should consider various scenarios and put a financial value to them. This needs to be an amount that acts as an incentive for your service provider to meet agreed service levels without going beyond the level of reasonable compensation.

Furthermore, it is important to set out performance monitoring expectations within the SLA – not just in terms of monitoring response times and grounds for compensation, but also in terms of proactive monitoring.

This way, monitoring can help to strengthen your relationship with the service provider as you work together to address any issues as and when they arise. You will need to work with your service provider to take countermeasures before you experience any breach to the conditions of your SLA.

Proactive analysis of response times should be conducted by the provider and you should be given regular visibility of this. Trends can also help you tweak the service over time and ensure SLAs remain appropriate to the current requirements.

For more information, you can download our guide.

Or, for personal advice and assistance, speak with our team.

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