What is a Service Level Agreement? 

A service-level agreement (SLA) simply means the contract or agreement that exists between a service provider and the end user or client. SLAs refer to outputs from a service provider that the customer is expected to receive. SLA describes the agreement and commitment to quality service, availability of service and fulfillment of responsibilities between a service provider and a customer. Whether it is an internal or external service provider, it is expected that the services and responsibilities included in the contract are met.

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How is a Service-Level Agreement Used?

A service-level agreement can be a legal contract or informal agreement binding the relationship between service providers and their customers. SLAs define what a customer is expected to get from a service provider in a business agreement. However, any service rendered that is not in alignment with the contract between the service provider and the client is not a SLA. The main focus of the service level agreement is the output received by the customer as a result of the service provided. SLAs can occur at different levels which include;

• Service-based SLA: this is an agreement for all customers using a specific service, good examples are services provided by a mobile phone/service provider or a service provided by an email system that an organization uses.
• Customer-based SLA: unlike the service-based SLA, this type of SLA is customer specific. It is an agreement between individual customers.
• Corporate-level SLA: this is generic, it covers the agreement between a service provider and a corporate organization.

Other common levels of SLAs are multi level SLA, service-based SLA, customer-level SLA among others. There are some major components of Service Level Agreements, these include;

• The definition of services that a customer is entitled to.
• The specifics of services to be provided by the service provider without leaving any detail.
• The reliability and responsiveness of the SLA.
• Monitoring of SLA and periodic reports on its effectiveness.
• Modifications for reporting issues with the services provided.
• Response time-frame from the service provider on the complains by the customer.
• Periodic check on issues and time-range of when they will be resolved.
• Consequences of failure to keep to the terms and conditions of SLAs both by the customer and the service provider.
• The period for termination of service agreement.

Common metrics

There are certain metrics associated with service-level agreements, these metrics constitute the mode of operations and corresponding service-level objectives exhibited in service-level agreements. The common metrics of service level agreements include;

• The time taken to complete a task during the phase of a project (TAT; Turn-around Time)
• Time taken to recover after an outage of service. (MTTR; Mean Time to Recover)
• The percentage of calls answered within a time-frame (TSF; Time-service factor)
• The percentage of calls abandoned otherwise called (Abandonment Rate).
• The percentage of incoming calls that can be resolved without the caller calling back the helpdesk. (FCR; First-Call Resolution)