Service Level Agreement

A Service Level Agreement (SLA) is a negotiated agreement that specifies the type of work, quality level, parties involved, and other expectations under which one company or organization will provide services to a client organization.

A SLA helps identify expectations, clarify responsibilities, and facilitate communication between the parties involved. The purpose of an SLA is to quantify the minimum acceptable service to the business client.


A Service Level Agreement can protect the interests of all parties involved - the provider of services and the recipient of those services. The SLA should identify and define the client requirements for system operations.

For example, if your client thinks the solution should be operational 99.5% of the time during regular business hours, you would definitely want to put this in your agreement.


On the other hand, Service Level Agreements can be very difficult to negotiate and difficult to measure. While you may always want some type of SLA in place when dealing with an outside entity, they can be cumbersome when utilized internally.

The people involved need to make sure that they are obtaining value for the time invested in created and monitoring the solution based on the SLA.


One of the benefits of creating this document is to encourage a dialogue between the two parties and promote proactive communication. The SLA lays out the expectations of the client and the commitment of the support organization.

If you have an SLA in place, there should be no misunderstandings as far as the level of service provided to the client. The support organization also can ensure that they have the resources available to meet the service level they have committed to.


The SLA is based on the level of commitment the support organization can provide for the price the client organization is willing to pay.

Although the client may want a very high level of support, they may not have the funding available to pay for support services at that level.

They will then be able to reduce the service level commitments to a level that they can feel comfortable with and that they can afford.

For instance, the client might prefer that all problems be resolved within four business hours. However, the level of support staff needed to meet that commitment may be higher than the client is willing to pay.

Therefore, the client may agree instead to allow the support organization to resolve problems within two business days. This still is timely enough for the client's needs and will result in a support cost that the client can afford.

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