Understanding and Designing Service-Level Agreements

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Understanding and Designing Service-Level Agreements

What is an SLA, why are they important, and what’s included?

Working with vendors and partners in business can be an enjoyable experience. But partnerships and professional relationships have their moments of misunderstanding and false expectations that lead to tension. Even worse, these relationships can leave a huge wake of devastation and frustration behind them if they fall apart.

The path to a successful outcome requires both parties to have clear expectations from the very beginning, maintain open communication throughout the entire process, and hold each other accountable. Technology vendor relationships are no different, which is where service-level agreements (SLAs) come into play.

SLAs are an integral part of most technology vendor relationships. They set boundaries and lay out what both the client and the provider expect from one another. Let’s take a look at what exactly an SLA is, why they’re critical to have, and what’s included in them.

What is an SLA?

A service-level agreement is just that. It spells out the level of service a customer can expect from a vendor. Beyond that, an SLA establishes metrics by which this service can be measured, and lays out repercussions that take effect when the service is not performed. SLAs are usually made between a company and an outside vendor, although they can be made between departments within the same organization.

For example, many network management vendors have a clause in their SLA promising 99% network uptime. The SLA includes metrics on how to measure that goal, which is usually done via software. The agreement also contains consequences should the uptime drop below 99% within a specific timeframe, such as a monetary discount for the client.

Why SLAs matter

SLAs are important for the same reasons any business agreement is vital. They minimize the chances of confusion and give both the client and the provider a leg to stand on should something go wrong. Everything is included in one centralized document for both parties to agree to and reference down the road.

SLAs establish expectations

You may know this feeling. Everyone leaves a meeting—seemingly on the same page and ready to conquer the world—but you find out three days later that someone understood the conversation differently and took things in an entirely different direction. That’s a scenario SLAs are designed to avoid. SLAs spell out what success looks like for both the client and the vendor, and how exactly that success will be measured. This prevents the agreement from being changed at the last minute, and parties can’t claim a misunderstanding.

They ensure the best service

By clarifying all of the details upfront, vendors can focus on providing the absolute best results possible. There shouldn’t be distractions or time wasted trying to sort through any confusion. Vendors can fulfill their part of the agreement in the time allotted.

SLAs measure progress

It doesn’t matter if you’re in sales, marketing, IT, or engineering. Every goal that you set out to accomplish has to be measurable in some way to judge success. SLAs have these metrics built in so that both parties can agree on the best way to measure progress as well as which benchmarks to hit along the way.

Documentation holds parties accountable

SLAs also include penalties or repercussions that go into effect if service benchmarks are missed. These clauses hold the vendor accountable for the level of service they agreed to provide, and they act as an incentive—the vendor is encouraged to stay on task and deliver results on time.

What’s included in an SLA?

Overall, SLAs include details about the services provided, how to measure the success of those services, and what happens if those services are not provided. Here are some of the components typically seen in these agreements:

1. Service outline. What is the service being provided? This should go beyond a basic description of the vendor’s services and include why they are providing them and how they will help the client.

2. Requirements. What are the specific requirements of this agreement? This is the section that should define what success looks like. If there are particular performance numbers or a timeline involved, this is where you want to lay out those expectations. This segment should also include the responsibilities of each party, so no one misunderstands their role in the agreement or is left placing the blame on someone else.

3. Measuring and reporting. How will these metrics be measured, and what are the expectations for reporting? The client and vendor need to agree on the best ways to measure performance so that results aren’t skewed or doubted. Metrics should include a specified frequency of how often the vendor provides updates on progress.

4. Communication and issue resolution. What does communication look like between the two parties, and how are issues resolved? Clients will have certain expectations and requirements about the frequency with which they want to hear updates from a vendor and how. SLAs can help ensure a vendor’s operations meet those standards.

This is also where the communication thread is established should there be an issue. How are complaints received and transmitted? How are the problems discussed? And who keeps track of their resolution?

5. Penalties. What happens when the service doesn’t meet the requirements? This will vary from case to case. It could take the form of financial benefits, service upgrades, or early termination of the agreement.

Protect yourself with an SLA

Legal counsel should always review service-level agreements before signing. Attorneys will look into the details and ask any questions that might not occur to you as the client. And note that SLAs do not last forever. They should be reviewed regularly to evaluate needs and requirements.

7SIGNAL puts in place strong, clear, and well-defined service-level agreements to ensure continuous network monitoring and maximized uptime. And we pride ourselves on hitting all specified goals and ensuring the operation and protection of one of our clients’ most critical tools.

Please contact us today to learn more about how our Wi-Fi network monitoring solutions can boost your organization’s efficiency.

7SIGNAL® is a leader in enterprise Wireless Network Monitoring. The 7SIGNAL platform is a cloud-based Wireless Network Monitoring (WNM) solution that continuously troubleshoots the wireless network for performance issues – maximizing network uptime, device connectivity, and network ROI. The platform was designed for the world’s most innovative organizations, educational institutions, hospitals, and government agencies and is currently deployed at Booz Allen Hamilton, IBM, Kaiser Permanente, Walgreens, Microsoft, and many others. 7SIGNAL continuously monitors the connectivity of over 4 million global devices. Learn more at www.7signal.com.

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