Checklist: Service Level Agreement

This free resource is not for resale or redistribution. | Last updated: 3 December 2020

Find out what to include in your SLA document

Summary

Start the doucment with a summary of the purpose of the document, the services covered and to who they are being delivered and what success looks like to the parties involved.

Who / Goals

The SLA first needs to define the parties involved - the company offering the service and those receiving it. The agreement might be personalised to a specific customer, groups of customers, users of a service tier (e.g Gold / Silver / Bronze), users of a particular product, or customers in a specific market (e.g healthcare, who might have different expectations and needs).

It is also worth considering outlining the goals of each of the parties involved. What does the service provider hope to achieve and what is the customer seeking to achieve. This could be generalised support for a business problem or task, or a specific deliverable like reliable, fast internet connectivity.

Guarantees or indemnification?

The SLA should make it clear what happens when the expected service level is not provided. Do the customers covered by the SLA get a refund (guarantee), or should the service provider pay for any costs incurred by the customers (indemnification) as a result of the service level breach? . You might choose to make it clear that there is no compensation or refund available. Depending on how the document is set up, your SLA might just be a promise to the customer or it could be a legally binding document that forms part of the contract of sale.

Non transfer clause

You may wish to add a clause that makes it clear whether or not the SLA will transfer to a new provider if the service provider is taken over by another organisation.

How is service level measured?

The metrics and key performance indicators (KPIs) that are used to monitor the performance of the service should be published here, including the expected performance level. For instance are you saying that customers can expect 100% uptime, or network availability?

Other metrics may cover customer service response times, outage resolution times and other defect rates. The security of software and systems is increasingly important and their may be standards that must be maintained or key activities like the timely application of software updates.

In outsourced or highly integrated supply chains the customer’s business results may even be mentioned in this section - this could be the number of customer calls answered within a specific time limit.

When selecting metrics it is important to drive the right business behaviours - you don’t want to make your staff busy fools that focus on non-value added activities. Instead of measuring the process (a common mistake), try to either measure outcomes or the metrics that will drive the desired outcomes.

How can service levels be monitored?

How can a customer monitor your current and recent performance of the KPIs covered by the service level agreement? This may include access to an online portal, or the publication of SLA KPIs in quarterly business updates.

Points of contact

It can be useful for your customers to know who they should contact regarding the SLA agreement itself or the routes to seek redress with key metrics are not met. The service provider may also require up to date contact information for a key person in the customer organisation. This could be required in order to notify the customer of expected downtime or key changes to a service, like an IP address change for a service endpoint.

Review period

How often will the SLA be reviewed? This may not be necessary if the wider service contract is up for renewal annually, but on longer contracts customers and suppliers may wish to review the SLA and ensure that it is still meeting the goals and objectives of all parties.