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Your Service Level Agreement Stinks

Here’s what to look for – or avoid – in an SLA

When you're dealing with something as critical as your business infrastructure, you want to be sure that you'll get what you signed up for. If a company promises something, and you promise your colleagues something based on it, you want it to happen. That's where the service level agreement comes in. It's part of your contract that tells you what to expect and what happens if the company fails to meet those marks. Simple enough, right? Wrong.

Not all service level agreements are created equal. At a minimum, an SLA will formally define the services in a contract. In their highest forms, SLAs embody the values and capabilities of an entire organization, and they provide a clear benchmark for employee performance and customer satisfaction. If you are comparing IT service providers, it's time to set the bar high. Simply put, you want an SLA that is transparent, accountable, holistic, and logical for the provider. Here's how to spot it.

Most SLAs
Typical SLAs are buried in 20 pages of legalese. If you can find it, and cut through all the jargon, you might gain a vague idea of what will happen when your service provider fails you. And when your service experiences a disruption - which will eventually happen in one form, no matter which provider you choose - it will fall on you to translate the SLA and request credit, and of course, the company will make it as tiresome as possible to get your money.

Few customers actually get rebated by companies like this, and that, I can assure you, is a business strategy. If you provide a strong service, you don't need to hide behind a labyrinth of legal jargon. And if you are a customer, you do not want to entrust your IT infrastructure or assets with a company that is opaque, indifferent, and irresponsible.

Transparency
Good providers tell their customers exactly what they're going to get, and tell them exactly what is going on at all times. This is all that customers ask. Speed, though desirable, can never compensate for unpredictability and deceptiveness. An enlightened SLA needs to detail specific, measurable commitments that tell customers what service they will receive, how quickly they're going to receive it, and what happens if they don't get that service.

Let me give a clear example from my experience with IT infrastructure hosting and cloud computing at SingleHop. We have an SLA we call the "Customer Bill of Rights." It more or less anchors every facet of our service. It is in fact an extension of our entire system. We operate on a principle called "Operational Transparency." This means that if a server goes down, we update affected clients in real time. If they wonder "have our servers gone down? If so, how long have they been down this quarter?" or "how much time do I wait for a response from tech support?" they can view a digital Report Card that details each item in their SLA and shows continuously updated data on how SingleHop is performing relative to each agreement. That is transparency. When you combine operational transparency with a detailed SLA, it turns all the usual mirrors around into clear glass.

Accountability

What happens when a company messes up? Well, several things can happen:

  1. Irate customers cancel their contract.
  2. Irate customers invite their provider to a brawl in the legal ring.
  3. Irate customers watch their provider take responsibility and then respect them for it.

Everyone should prefer option #3. Cancelling a contract and shifting providers is costly and legal battles are very expensive. Migrations are dangerous and can disrupt business. You want an SLA that holds your provider accountable for any failures - be they outages or just slow responses. You should know the exact deployment time for a server and know exactly how much you will be credited if your service provider exceeds that time. You should know the expected response time from tech support, and know exactly how much you will be compensated if they take longer.

You know all this information not because you've been timing your service provider, but because they offer this information upfront. Don't work with a company that you must lasso and tie-down for a rebate.

Holistic
How many interactions does the SLA cover? And, do items in the SLA conflict? For example, if an SLA promises support updates every three hours, but does not give a first response time, what good is the SLA? You could still bleed money for eight hours before getting a life raft. Great SLAs are comprehensive and holistic. They encourage customer-provider symbiosis. The best SLAs actually play into the interests of the provider - remember, they want lots of happy, sustainable customers.

As a customer, map out your anticipated interactions. If the SLA covers each interaction, it is holistic. If not, you can do or request better.

Understanding What's Not Mentioned
There are a lot of different aspects to an IaaS SLA that should but are not always mentioned. These are obvious to providers but not all customers see them right away. How fast does it take to replace a broken hard drive? Does the company keep replacement parts in stock or does it need to order them? Is there a senior tech available at all hours, and if so, how fast do escalations take? Make a list of the concerns you have, talk to people who have been through it and ask lots of questions. Sometimes when something is omitted, it's omitted for a reason.

Business Logic
Finally, a great SLA should be good for the receiver and the provider. If you are the customer, you should want transparency, accountability, and comprehensiveness to be in the interest of your service provider. Why? Because in an ideal world, you can rely on the same IT infrastructure for years and years, and frankly, that means your provider must succeed. And, if meeting the SLA is in the interest of the provider, then the provider will probably use it to evaluate their employees, sift out the bad eggs, and measure company-wide improvement. If, however, the SLA is against the interests of the company, then your provider may in fact discourage its employees from being too forthcoming and helpful.

Think about an SLA as the ‘moral' code for a company. If being "good" actual falls in line with a company's desire for profit, then that company is more likely to follow their code. If being "good" exacts cruel and unusual punishment on a company, then they will prefer to be "bad." Look for alignment between a company's interests and SLA. If they disagree, run for the hills.

Be Fruitful and Provide
A Service Level Agreement is a template for how a business intends to interact with customers. If it is transparent, accountable, holistic, and business-savvy, it is a winner. If you need a machete and $400 per hour guide to find it in the legal jungle and understand it, it is time to explore other options.

More Stories By Dan Ushman

Dan Ushman, Co-Founder and CMO of SingleHop, focuses on the company’s global marketing strategy and operations. He regularly attends and speaks at industry and marketing events. As a recognized thought leader in online marketing, Dan is one of the few internet marketing professionals to hold a Horizon Award for Marketing Innovation. When he isn’t working, he can be found in his kitchen whipping up homemade BBQ sauce, or in front of the grill with a spatula putting that sauce to work.

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