Service Level Management

A service level agreement, also known as an SLA, is an agreement between a customer and an IT service provider laying out service expectations for both parties. It’s essentially a contract promising certain service levels to the client—with specific and measurable minimum services—in return for payment. The agreement can either be legally binding or it can be informal, but, either way, the expectation is the service provider will uphold their end of the agreement.

There are three different types of SLAs, all of which are designed and negotiated through a process called SLA management. The specific contents of the SLA depend on the type of agreement and the services provided in each case. However, the components typically included in most SLAs include:

• Detailed information on the scope of the services promised. This includes detailing the guarantees, priorities, and responsibilities of the service provider.
• Guidelines for tracking and reporting on provided services.
• Procedures for problem management and disaster recovery. 
• Information on the customer’s duties. 
• Details on the fees and expenses for the services provided and clauses addressing terminating the SLA. 

It’s important to remember an SLA isn’t meant to be unchanging. One central element of service level management is reviewing and revising SLAs following any change or update to the service. Depending on the type of SLA you have in place, it may require updates at a different rate than other types.

With an SLA in place, the relationship between a customer and an IT service provider can run far more smoothly thanks to there being a clear record of the expectations for both parties. 

The three types of SLAs are: a service level SLA, a customer-based SLA, and a multi-level SLA. One key element of IT SLA management is considering which might be the most appropriate type of agreement for your specific needs and the services being provided. The first step to determining which SLA you need is understanding the three different types:

1. Service level SLA - This type of SLA covers one level of service for all customers. In this scenario, all the customers will receive the same level of service. An example of a service level SLA is the agreement a mobile service provider offers. All the provider’s customers receive the same level of maintenance and guarantees of service for the same cost.
2. Customer-based SLA - The second type of SLA is essentially the inverse of the service level SLA. While the latter provides for one service being promised to a large group of customers, the customer-based SLA provides for multiple services being promised to one customer or customer group. For example, a customer-based SLA might involve an agreement between the finance department for a large organization and an IT service provider. The service provider would offer various services to the finance department, and a customer-based SLA could have one agreement covering all those services for that customer.
3. Multi-level SLA - The final type of SLA is split into multiple levels addressing different sets of customers for the same services. Even though the customers at each level are guaranteed service from the product, the specifics and levels of service provided will vary between them. With a multi-level SLA, all those different specifications are included in one SLA. 

The objective of an SLA is to have an agreement to protect both parties. It’s meant to ensure businesses can run smoothly thanks to there being a clear, predetermined framework to guarantee delivery on the promised services. SLA monitoring, which is one of the central elements of service level management, involves making sure the service provider delivers on the promised levels of service.

For an SLA to be able to fulfill its objective of protecting both the customer and the service provider, it needs to include several critical elements. It must: 

• Specify the type of service being provided with as much detail as is necessary on the type of service.
• Include the desired (and expected) level of performance for the service. Particular attention should be paid to the expected responsiveness and reliability of the service. 
• Lay out how the levels of performance will be monitored and supervised. This typically involves determining which types of statistics will be collected, plus how often and in what way the customer will assess those statistics. 
• Have steps for reporting a problem with the service. This includes details on the person who handles problem reports and the order in which detailed should be reported. The SLA also needs to include a timeframe for when the problem will be looked at and resolved. 
• Include the repercussions for the service provider if they don’t meet the commitment laid out in the SLA. These repercussions can include the customer being able to ask for a refund for the losses they incurred as a result of the failure of service. They can also include the customer having the right to terminate the contract.

SLA management, also called service level management, is the process of comparing actual service performance with the predefined expectations for performance laid out in the SLA. As part of this, SLA management also involves creating SLAs and revising them as needed with updates to services and the customer’s needs. 

SLA management oversees and is involved in every step of the service level agreement process. It helps define expected levels of service performance and documents those expectations within an SLA. It guides effective SLA monitoring by measuring performance statistics and reporting on them to determine whether the service provider is fulfilling its obligations.

In addition to making sure the SLA is fulfilled, SLA management also monitors customer satisfaction, so the IT service provider can make sure they’re providing value to the customer as compared to competitors. Customer satisfaction often goes hand in hand with other elements of service level management, like ensuring the successful fulfilment of the SLA. SLA management can help you make sure service providers meet or exceed their customers’ expectations. 

SLA management is important because it provides a framework for creating an SLA and then lets you see if the quality of services you’re providing or receiving matches what was agreed upon in the SLA.

Without an SLA, there won’t be any clarity on what happens if one of the parties doesn’t hold up their end of the deal between the service provider and the customer. This means neither party is protected in case of a failure to deliver on the promises. Whether or not an SLA is legally binding, it’s still important because it lays out the expectations for both parties in writing, so no one has to wonder what they can expect.

With an SLA, you provide transparency and clarity for your customers and yourself. SLA management means you can be confident both parties have the same expectations for service without wasting time trying to determine what quality of service the customer expects.

SLA management is also important because it allows you to monitor customer concerns over service performance. If you have a software tool to aid with service level management, you can see all your tickets about performance issues together, so you can better monitor customer satisfaction and overall service performance.

SLA management is important because it allows your business to run smoothly without needing to worry about unknown service expectations.

Service level management software can help your organization manage and monitor the level of service you receive from vendors or the level of service you provide to your customers and employees. Service level management involves defining, tracking, and ensuring any agreed-upon service levels are met—and SLA management software simplifies the entire process.

You'll need to define your SLAs to get the most out of your SLA management software. By establishing acceptable performance metrics and targets in advance for various services, you can ensure all tickets are responded to and resolved in a reasonable time frame. These SLAs could cover aspects like response time, resolution time, uptime, availability, and more.

Once you have defined your SLAs, the software can continuously monitor and measure relevant metrics from your systems, applications, and networks to ensure they perform as expected. If the software detects any SLA breaches or potential breaches, it can notify your team. Some solutions rely on email; others send SMS messages or dashboard notifications.

Many SLA tracking systems will also aggregate data collected over time to provide a historical record, which could provide valuable insights. For example, you can better understand recurring issues and identify trends. If you notice your team is regularly missing SLAs, it could be a sign your agents are overloaded and either need better ways to deflect tickets or more team members to share the load. Access to data collected over time can also help you pinpoint areas for improvement. For example, you may notice one of your current processes isn’t as effective as you had hoped, your technology needs upgrading, or you need to alter how you allocate resources.

Some IT SLA management software solutions will also automatically take action when SLA performance crosses certain thresholds. For example, an automatic escalation process may begin if response time exceeds the SLA limit, saving your service desk SLA team time and energy.

IT service level management tools can offer the SLM software functionality you need. For example, SolarWinds’ Service Level Management is a function within Service Desk, an IT Service Management (ITSM) solution.

Overall, service level management tools help organizations maintain a high standard of service by providing real-time insights into performance, enabling them to prioritize tickets appropriately and take actions to prevent SLA breaches, leading to a better experience for all involved.