The Service Level Agreement

1.INTRODUCTIONIn today’s business organizations, e.g. private and government sectors, Information Technology has become a mandatory asset to guarantee continuous quality services to customers/ IT end users for the fast, secure and reliant processing of daily tasks and works. Examples are the Health Industry, Banking and Stock Markets, Media and telecom operators, Fortune 100 companies, etc.…

Therefore, and as part of an “Organization(s)” Information Systems Operations policy, the resort to “Service Level Agreement “a control mechanism to assure IT Services Level to end Customers i.e. the IT end users proves mandatory.

2.DEFINITION The “Service Level Agreement” (SLA) is a commitment to a service level provided by a “Service Provider” Organization 1 to its Customer(s) party(s) Organization 2 expressed in a document. It generates a Demarcation Line between the “Service Provider” and “Customer” for both to be able and allocate their necessary resources, processes and capabilities to fulfill this agreement. A conceptual drawing is shown in Figure 1.

.

Figure 1 Concept - Service Level Agreement

1

3. SLA DOCUMENT CONTENT

An SLA typical content (Figure 2 below) covers the following items and can take the shape of External or Internal, as explained:

1. The Services agreed upon included in an ICT Service’s Provider ideally as part of a “Services Catalogue” or a company’s corporate “IT Policy”.

2. The criteria of service quality assessment known also as the “Key Performance Indicators “KPIs" (external and Internal)

3. The Legal part, “Terms and Conditions” stating each party’s roles and responsibilities (externa)

4. Penalties in case of non-compliance in case of external SLA(s) (external)

Figure 2 Typical SLA Content

Also, in external type SLAs forms a major part of the agreed contract’s “Statement of Work”

The “Service Provider – Customer” SLA can take many formats and combinations; internal or external, Services or equipment based, integration or a combination. Examples are provided in Table 1 below.

Cases Service Provider Customer SLA Type1 ICT Vendor

(Equipment, Software)IT Department External

2 ICT Services Network Operator External 3 Network Operator IT Department External 4 IT Department Finance, HR,

Maintenance etc.Internal

Table 1- SLA Example Cases

2

4.PRACTICAL EXAMPLES

4.1.External SLAs The most common “SLA” so far known within the ME region are the external type ones (1 and 2 above)

For example, an IT Dept. has SLA(s)s with an ICT Vendor providing Equipment and/or Software e.g. Servers, routers, firewalls etc. and/or applications which, application e.g. databases, CRM, ERP, which cover the delivery, installation maintenance, and software license or equipment configuration upgrade. This SLA forms a major part of the signed contract’s “Statement of Work”. Typical Key Performance Indicators (KPIs) in this case are:

- Equipment installation and maintenance time- Software License Upgrade as made available - Equipment configuration upgrade

Another common external SLA is the, “Network Operator –IT Department” where the “Network Operator” is the “Services Provider” for e.g. telecom links, Internet access, Mobile services. Typical KPI’s in this case are and the company’s “IT Department” is the customer could specify the following KPSs:

- Company’s links connectivity availability (99.9% of time)- Internet Access, providing fast and secure access to the Internet - Equipment installation and maintenance

with KPIs like “Mean Time to Repair” MTTR time to recover a fault equipment or link after outage, and Time to Request (TTR) which represents the time it took the vendor technical staff to be available at the customer premise since the service call made by the customer’s Help Desk for equipment fix or link outage resolution.

4.2.Internal SLA(s)

In many today main organization which have realized the value of Information Technology and which operation may extend wide e.g. Fortune100 the IT Department acts as internal “Service Provider” (Network Operator and

3

Equipment) and usually serves large number and possibly various types of “IT End Users” (Case 4) with different IT requirements and needs

Examples are Oil Service companies, international Telecom operators, leading IT vendors and whose offices may expand the globe.

To assure departmental performance and customer i.e. “IT end user” satisfaction the “IT department” resorts to an “SLA” embedded within the company’s corporate “Information Technology Policy”.

In both the Internal and External cases, SLAs should enable the assessment of the Service Providers performance and Customer satisfaction, as measured per agreed on KPIs measures.

It also provides a great degree of transparency especially in the Internal case by setting out right from the beginning the “IT End User” Service expectations when it comes to corporate IT.

5.SLA BENEFITS AND CHALLENGES

SLAs is a major enabler when it comes to the needed governance and control of the IT Services delivered to the end user. It provides measures, the Key Performance `Indicators (KPIs) to assess the “Service Providers “performance and the customer satisfaction.

However, SLA agreement form depends heavily on the maturity of the ICT practice within an organization. In the external, professional major IT companies or telecom operators, the SLA form part of their Contracts i.e. ready-made corporate template.

In this case, he customer is highly recommended especially the when signing party as frequently observed is the Purchase Dept. that the IT Departments review, change, renegotiate if necessary and approval prior to corporate signage. The IT Service quality and performance is the IT Department’s ultimate corporate responsibility and It is a “One Box Fits All” situation.

As mentioned renegotiation, might even prove mandatory due to changes to the customer’s ICT environment or dissatisfaction with performance. It may even prove necessary to go through acquisition Tender RFI, RFP, negotiation BOQ, Contract ne.… prior to agreement and signing.

4

Also, to guarantee benefits both parties, the customer and service provider must be genuinely committed in good faith to support all prerequisites necessary, agree to practical and achievable KPIs, periodically review them, ready to solve issues of non-compliance and resort to legal only in exceptionally and “extreme “cases to guarantee smooth flow and continuation of ICT services.

However, for immature organization, who want to apply the “Service Level Agreement” concept internally Internal SLA) for the first time, what is the best strategy to approach in order to guarantee by end of this new change the same benefits mentioned above?

5