Definition:
Service Levels define the performance thresholds to measure outcomes according to pre agreed standards. Measurements are typically rates, such as speeds, failure rates, uptime, downtime, output units per time unit, or output per unit of input. Service level agreement methodology has evolved over the years from merely measuring technological uptime and throughput of the processors to a higher level of measuring benefits to the user. For example, in addition to measuring computer utilization and efficiency, SLA’s can measure financial benefits such as return on investment, reduction in overall administration expense, speed to market for a new product, speed to achievement of a target market share for new product or service, and similar financial metrics defining shareholder value.
Examples:
The level of service provided will depend on the company and program chosen, but the scope of services that can be outsourced are:
– Basic Front-End Help Desk Support (Operating System repair, Troubleshooting, etc.)
– Hardware Repair
– Software and Application Support
– Network and System Administration
– Infrastructure Administration
– Security Monitoring
– System Maintenance
– Proactive Analysis
– System Optimization
– Problem Solving
Benefits:
SLA Measurement has become a new hotbed for the software industry. Independent software vendors (ISVs) develop off the shelf programs for managed service automation (MSA) that inspect and report on real time utilization and efficiencies of virtually all devices. Additionally, they measure network connectivity in an end-to-end managed service, such as ITO or BPO. Such software tools enable customers and service providers to see dashboards, in real time, of effective SLA software that also links to discover, audit and inventory the utilization of each device and resource in the network. Dashboards report the exceptions to anticipated performance levels (the red zone). Effective SLA Software also links to management reporting and service billing according to price adjustments for failure to achieve agreed SLAs.
Further Reading: http://www.outsourcing-law.com/2011/05/legal-issues-performance-metrics-innovation/