SLA – ITS TYPES & IMPORTANCE

Service Level Agreement is a solemn written commitment made by a service provider to a client for ensuring business sustainability by keeping various business functional aspects healthy and running.

There are 3 types of SLAs:

1. Service-based

2. Customer-based

3. Multilevel or Corporate-based

SERVICE-BASED SLA

Service-based SLA is the one drafted for a specific service and can be directly made for a customer(s) or a business who wants to subcontract it for a group of its end customers.

CUSTOMER-BASED SLA

This is specifically tailored made for a unique customer requirement. In an organization, this can be service offered to one or two departments only.

MULTILEVEL OR CORPORATE

This is a holistic agreement that covers almost all the general issues relevant to the organization.

WHY SLA IS CRUCIAL?

A well-defined service level agreement lays out a clear set of expectations agreed between the service provider & the client. The SLA works as a blueprint of services offered to guard the assets and reputation of an organization. Please find below a few reasons as to why an organization should undertake an SLA:

1. Defines Solid & Unambiguous Guidelines

A clearly defined SLA ensures both the parties are on the same page as far as the quality and standard of services go. This also enables measurement of performance against a number of guidelines mutually agreed upon while drafting the agreement thereby maximizing the efficiency.

2. Safeguards Business If All Obligations Aren’t Met

Since the failure of a service provider to meet all the set obligations in the agreement can bring about a possible monetary loss to business besides harming its reputation, the SLA can have a clause of monetarily compensating the business if such an event happens. Hence, the service provider also is fully alert and does all that can be to offer optimal services.

3.  Probable Win/Win Situation 

For a business, an SLA with a service provider comes with certain guarantees which if aren’t met result in monetary compensation. Hence, it’s somewhat a win/win situation for the client or the business.

To conclude, the Service Level Agreement is a great means to safeguard the company’s assets and at the same time have a great relationship with your service provider. A well-documented, thoroughly defined SLA is necessary to work all the expected obligations and ensure all the involved parties are on the same page!

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