Content
- What is an SLA?
- What is the purpose of an SLA?
- Benefits of an SLA for business
- Benefits of an SLA for the service provider
- What is an OLA?
- Key differences between SLA and OLA
- What should be included in an SLA agreement?
- What common mistakes are made in SLAs?
What is an SLA?
A Service Level Agreement (SLA) is an important supplementary document that complements the main contract between the service provider and the business client. It details all the services provided, service levels, as well as the rights and obligations of both parties. The SLA originated within the international ITIL library, designed to optimize business processes in the field of information technology. Initially, such agreements were primarily signed with cloud providers responsible for the virtual infrastructure of companies. However, nowadays, SLAs are actively used in other business sectors as well.
The agreement is effective in the context of regular and easily measurable tasks. For example, in information technology, this may relate to sending email newsletters, while in administrative processes, it may concern issuing certificates or receipts. In marketing, SLAs are often used to assess the effectiveness of lead generation.
What is the purpose of an SLA?
The main goal of an SLA is to create transparency and measurability of business processes, which ultimately benefits both parties. The service provider is protected from unfounded claims, while the client gains assurance that any malfunctions will be addressed within agreed-upon timeframes.
Benefits of an SLA for business
- Quality management: Clients know exactly what service they are receiving and what to expect from the provider.
- Cost forecasting: In the event of malfunctions, the company knows in advance the costs of maintenance and risks associated with downtime.
- Improvement of service quality: Quick responses to customer complaints enhance brand satisfaction.
- Risk management: The SLA establishes procedures for quickly addressing malfunctions.
- Increased efficiency: Often, a personal manager is assigned in the SLA, which improves communication and understanding of the business specifics.
Benefits of an SLA for the service provider
- Boundaries of responsibility: The SLA allows for clearly defining what is expected from the provider, thus protecting them from excessive demands.
- Error resolution guidelines: The provider can act within the agreement without coordinating every detail with the client.
- Team effectiveness: The SLA records key performance indicators, which helps optimize business processes.
What is an OLA?
Along with the external SLA, contractors often develop an internal document known as an OLA (Operational Level Agreement) or internal SLA. This document regulates the interaction of employees within the team and between departments while performing tasks for the client. Typically, the OLA is created before the SLA is signed, allowing for an assessment of the team's capabilities before guaranteeing results to the client.
Key differences between SLA and OLA
| SLA | OLA |
|---|---|
| Agreement between the provider and the client. | Internal regulations of the provider. |
| Controls service quality. | Controls internal processes. |
| Describes all types of project tasks. | Defines the work of a specific department. |
| Describes the provider's responsibilities and areas of accountability. | Has a technical nature and records internal quality indicators. |
What should be included in an SLA agreement?
- Introduction: Information about the provider, the equipment, and software used.
- Service provision conditions: Working hours, schedule, and location of service provision.
- List of services: Description of all tasks performed that can be measured.
- Priorities: Services classified by priorities: low, normal, high, and critical.
- KPI (key performance indicators): Metrics by which performance will be assessed.
What common mistakes are made in SLAs?
- No reporting period specified: It is important to clearly define the averaging period for calculations.
- Vague definition of service execution: Clear criteria for task execution facilitate the use of penalties.
- No unified methods for monitoring indicators: Specify how quality will be measured.