Do You Need SLAs?

by Mar 1, 2018

Every technical support organization should have service level guidelines as a basis for determining how to prioritize cases and allocate resources and for managing consistent expectations with customers. Introducing service level agreements with committed performance levels is only required when customers demand them, or it is necessary for competitive differentiation.

Service Level Agreements Defined

The terms Service Level Agreement or SLA are used to describe performance objectives for a wide variety of services. SLAs are used to describe the speed by which a replacement part will be delivered to a customer site, the up-time of an application, or the time it takes to respond to a question submitted to Support. Service levels may express a performance level in terms of a target or commitment.  The following definition provides a unified description of the various types of service level statements and agreements offered across the technology industry.

Service Level Agreements Defined

SLA Types

There are three primary types of service level agreements used within the technology industry.  The primary elements of the agreements include the committed or targeted level of performance, the conditions and definitions for how performance will be measured, and the provisions by which performance commitments will be enforced.  Typical technology service level agreement types include:

Agreements

Agreements state a committed level of service and the terms by which this service will be provided.  Service level agreements are typically enforced by some form of penalty when promised performance levels are not met.

Level of Performance: Performance commitments.

Conditions: Stringent definitions and conditions for determining SLA non-compliance.

Enforcement: Typically a penalty in the form of a rebate of service fees.

Firm Targets

Service level targets express a target level of performance for a particular service.  Targets are expressed in specific terms however there is no commitment or guarantee of performance or penalty imposed if not met.

Level of Performance: Specific performance targets.

Conditions: May vary by customer type, support program level or issue severity.

Enforcement: None.

Soft Targets

Service level targets may also be expressed in soft terms where a level of performance is suggested for some but not all situations.  When soft service level targets are missed there are no penalties.

Level of Performance: Performance ranges.

Conditions: May vary by customer type, support program level or issue severity.

Enforcement: None.

Why Use SLAs

Service level statements are used for a variety of reasons, most notably to establish differentiation from direct competitors or within a service offering to distinguish between program levels and tiers.  In some instances, customers will demand service level agreements as a prerequisite for doing business.  In all cases SLAs are effective for setting and managing customer expectations.  Well defined performance SLAs can prescribe how quickly to respond to issues, which issues to work on first, and who to get involved with issue resolution.

Set Customer Expectations

Competitive Differentiation

Service Tier Differentiation (within a Portfolio)

Prioritization and Resource Allocation

Do You Need SLAS?

Every technical support organization should have service level guidelines as a basis for determining how to prioritize cases and allocate resources and for managing consistent expectations with customers. Introducing service level agreements with committed performance levels is only required when customers demand them or it is necessary for competitive differentiation.

  • Do your customers expect them?
  • Do your competitors provide them?

If the response to either question is “yes” then you should be offering SLAS.

Featured: Support SLAs

This report explores the types of service level agreements used within the technology services industry and provides examples necessary for establishing effective service level agreement practices.

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