What You Should Know About SLA Agreements

Whether you manage customer infrastructure or provide services to other companies, sla agreements can help improve communication between both parties and prevent disagreements. They can also help define expectations and set performance goals for the relationship. An SLA outlines the specific details of a service provider’s obligations and responsibilities, including penalties for failure to meet those expectations. SLAs are usually written for outsourced IT services but can be used between departments within a larger company, too.

SLAs should clearly state a description of the services to be provided, metrics against which those services will be measured, duties and responsibilities of each party, remedies or penalties in case of breach, and a protocol for adding or removing metrics. Metrics should be chosen so that they are within the control of both the service provider and the customer, and they should be easy to collect and analyze. They should also be designed so that bad behavior on either side is not rewarded (for example, if the service level breach happened because of poor communications between both parties, the supplier should not be penalized for that).

Both parties should include a section detailing exclusions, which describes situations in which an SLA’s guarantees — and penalties for failing to meet those promises — won’t apply. This might include events such as natural disasters or terrorist attacks. This is often referred to as a force majeure clause and aims to protect the service provider from liabilities related to events beyond their reasonable control.

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