Service Level Agreement (SLA)

Service Level Agreement (SLA)

At the beginning of 2011, ComputerWorld published an article about emerging IT trends.  One of those trends is an improvement in IT service level agreements (SLA’s).  Is it time for your company to review its current service level agreements, and possibly refine or create new SLA’s?

The overall purpose of an IT service level agreement is to insure there is complete understanding of the IT related services that will be provided in order to support an application, a department, a network, hardware, or the users who use the systems and software.  For example, an SLA for a company’s email software may specify that all users must have access to their corporate email 24 hours a day, seven days a week.  If a user cannot access email, the SLA would state what mechanism is provided to contact a support representative to resolve the issue.

Other items covered in service level agreements include:

  • Software or hardware updates and how often they will be performed or reviewed.
  • Backup processes that define what will be backed up, how the backup will occur, storage locations, disaster recovery summaries, and the schedule for backups.
  • Support for administrators and first-tier support providers including technical information, database support, or network and server support.
  • Support for end users including email and/or phone contacts, hours of availability, expected response times, recording support ticket information, and documentation.
  • Accessibility for support – will the provider have remote access capabilities?  How will these be maintained?
  • Clear delineation and definition on what is to be supported.  Will a software provider be responsible for database support?  Will a server provider be responsible for network support?  How will a hand-off to a different provider or department occur?
  • Reporting on issues, resolutions, and the frequency of the reports.  Also, how will the reports be provided?  Via email or a service portal?
  • Escalation procedures and prioritization of service tickets.
  • Application or system performance expectations including database or network response time.
  • Third party agreements that may impact SLA requirements.
  • Quality level of resolutions.  Are problems resolved the first time, or are the recurring issues that only are fixed temporarily?
  • Renewal or review plans for service level agreements.
  • Pricing and/or budget impacts.

In addition, some newer SLA’s specify user productivity requirements and customer satisfaction analysis or rankings.  For example, an order processing system may have the expectation that a normal 5 item order should take less than one minute to process and be approved completely.  Or, the quarterly customer service survey must have at least 95% positive approvals.  Also consider upcoming initiatives and projects, and whether these implementations could have an impact on your current SLA’s.

With cloud computing, wireless applications and accessibility, and other new technology implementation, it might be time to review your service level agreements, and determine if you still have the right criteria to meet your business demands.

Image: Jeroen van Oostrom /

Handling the Remedy is available here and other leading retailers:


David Peterson

David G. Peterson is a business consultant and author of Handling the Remedy. He has extensive international experience managing projects and operations for large financial institutions. He has worked in North America, Europe, Middle East and Asia skillfully managing business and technical requirements, core systems enhancement and support, merger and acquisition integration's, business process reengineering, off-shoring and outsourcing.