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Service-Level Agreements

20/05/2019

What is an SLA?

A service-level agreement (SLA) defines the level of service you expect from a vendor, laying out the metrics by which service is measured, as well as remedies or penalties should agreed-on service levels not be achieved. It is a critical component of any technology vendor contract. SLAs are a critical component of any outsourcing and technology vendor contract. Beyond listing expectations of service type and quality, an SLA provides remedies when requirements aren’t met.

Why do I need an SLA?

SLAs are an integral part of an IT vendor contract. An SLA pulls together information on all of the contracted services and their agreed-upon expected reliability into a single document. They clearly state metrics, responsibilities and expectations so that, in the event of issues with the service, neither party can plead ignorance. It ensures both sides have the same understanding of requirements.

Ideally, SLAs should be aligned to the technology or business objectives of the engagement. Misalignment can have a negative impact on deal pricing, quality of service delivery, and customer experience.

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