Understanding Service Level Agreements
By Albert Chinamano
Building and investing in a network infrastructure is hard
enough, but making sure your service provider lives up to
its commitments, is an ongoing challenge that takes commitment,
time and money. Getting what you paid for goes well beyond
simply verifying a service provider's position in the marketplace
and the quality of its equipment and services. It requires
negotiating prowess, vigilant measuring and constant enforcement.
Everything hinges on crafting a strong service-level agreement
(SLA). What is this SLA?
Service Level Agreement means exactly what it says. It is
an agreement between two or more parties regarding the level
of service provided. If you use a network, application service
provider, outsourced software or services, you will depend
on that service provider to "be there for you".
The customer and vendor determine upfront which services and
performance levels will be provided and decide how success
or failure will be measured. Meeting or beating expectations
may earn the vendor financial rewards; failure can mean earning
less money or even a financial penalty
SLAs generally have three components:
- What are the services to be provided?
- What are the measured targets of service that the customer
expects?
- What happens if the service provider fails to meet the
agreements in the SLA?
IT Managers have to be very careful and have a clear understanding
of service level agreements when negotiating for one. A reason
for this emerging trend is that traditional service level
agreements are of the Vanilla variety only "one-size-fits-all"
conditions are applied to all customers with little way for
customization. SLAs of this nature tend to pay more attention
to the network providers’ core strength (resiliency of
the core backbone network availability – and perhaps
latency- being key components. Although having a network up
and running all the time is crucial, there are some more detailed
criteria that need to be considered.
The first step begins with finding out what levels of service
your organization actually needs to do its business, not what
service providers offer in their standard agreements. Knowing
what your infrastructure has to be able to support will (or
at least should) define what your SLA looks like.
If a guaranteed level of service is important, be sure that
the service you buy can reasonably be guaranteed. Asking a
service provider to artificially guarantee a service that
it cannot support doesn't benefit you - it actually costs
you more money.
A typical network services SLA probably covers metrics such
as availability, latency and throughput. It may also include
specifications for response time, mean time to repair and
problem notification/escalation guarantees.
So why not invest the time upfront to negotiate the biggest,
baddest SLA on the block? Because the more comprehensive the
SLA, the higher the cost of the service. The real question
to consider is, "Does it really make the service better?"
Another key issue is whether SLAs are truly end-to-end. In
many cases, performances guarantees are only applied across
the network backbone while the last mile of connectivity from
provider’s PoP to the desktop- are often excluded from
the agreement. This can lead to a finger pointing exercise
with providers saying ‘its not our fault’
The purpose of an SLA is to protect company against the worst
case. Effective SLAs do more than get a nominal credit back
- usually 5% to 10% of the cost of the service in the event
your infrastructure fails. SLAs give you a way to mitigate
the effect of problems that harm your network. For further
comments chinamanoa@afri-com.com
Private Limited shall not be held responsible of any decisions
made based on the information.
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