A Service Level Contract (SLA) is a negotiated formal agreement that determines the level of service provided by a service provider to its customers. In this way, it is both an obligation and a scorecard. You know the definition. But do you know that the use of SLAs in the service delivery management process is on the rise, whether it is external use, internal use or an outsourcing agreement? Service level agreements are the first step in creating a relationship between a service provider and a customer. If we realize what is expected of each party, there can be transparency and confidence on both sides. Regardless of the type of service level agreement signed, each party can now be held accountable in order to maintain its end of good deal. Sometimes it is necessary to compromise when the service provider does not have the resources to meet the client`s requirements. In this case, the client may be forced to review its requirements and the service provider may be forced to invest in more resources. Such compromises create a good working relationship between the service provider and the client.
Service Level Agreements (SLAs) are contractual terms that document the service standard agreed between the bank and the service provider and the quality of service. SLA is an important element in the implementation of a strong outsourcing contract. The ALS ensures that the institution receives the required benefits at the required price and standard. ALS is an essential part of managing the financial and operational risk associated with outsourcing contracts. It can also be one way to help reduce risk. Defining the unit of measurement and service space for the chosen level reduces the risk of service, as it becomes a priority area and is assigned as the service provider manager. The first type of service level agreement structure is service-based ALS. A service-based ALS covers a service for all customers. Consider that the IT service provider provides customer service to many customers.
In a service-based service level agreement, the level of service in customer consultation is the same for all customers who use this service. Yes, for example. B The financial department and the human resources department are two clients who use this service, the same ALS applies between the IT service provider and these two services, since it is a service-based ALS. Management should develop ALS by first identifying the essential elements of the service. Items can be linked to tasks (for example. B processing error rate, system operating time, etc.) organizational (i.e., staff rotation). Once management has identified the elements, it should find ways to objectively measure the performance of these elements. Finally, institutions should determine the frequency of measurements and an acceptable range of outcomes to determine when a service provider is violating ALS repositories. Service level agreements contain measures to measure the service provider`s performance. It can be difficult to choose fair measures for both parties. It is important that the measures are controlled by the service provider.
If the service provider is unable to control whether the metric is executed in the specifications, it is unfair to hold them to account for the metric. The third and final type of service level agreement is multi-level ALS. In multi-level ALS, aspects of ALS are defined by the client`s organization with a kind of heredition with global definitions relevant to all lower levels.