What Is The Purpose Of An Service Level Agreement

A Service Level Contract (SLA) is an agreement or contract between an organization and its service provider explaining the obligations and expectations of the relationship. There are many benefits to working with a service provider, but to make the most of this relationship, ALS should be put in place. ALS serves as a model for the service the provider will provide and can protect your organization`s assets and reputation. Below, we have identified 3 reasons why your organization should have ALS from its supplier. Depending on the service, the metrics to be monitored may include: The exact metrics of a service level vary from provider to provider. In addition, they differ for individual services purchased by the end customer. ALS often defines service responsibilities in terms of availability and performance. Some of the performance metrics include: Service Description – ALS needs detailed descriptions of each service offered in all circumstances, including processing times. Service definitions should include how services are delivered, the provision of maintenance services, operating hours, dependencies, process structure and a list of all technologies and applications used. In addition to defining performance metrics, an ALS may include a downtime and documentation management plan, as the service provider compensates clients for violations. Service credits are a typical remedy.

For example, service providers may provide credits commensurated with the period during which they exceeded the ALS performance guarantee. A service provider may limit performance penalties to a maximum dollar amount to limit the risk. IT service organizations that manage multiple service providers may wish to enter into Operational Level Agreements (OLA) that explain how some parties involved in the IT service delivery process interact with each other to maintain performance. Many SLAs follow the specifications of the Information Technology Infrastructure Library when applied to IT services. AlS should have two components: services and management. The measures should reflect only the factors that make the service provider exercise appropriate control.

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