Service Level Agreements have long been deployed by IT departments as a means of defining and measuring the performance of third party suppliers or vendors. Recent moves towards the outsourcing of a wide range of services in both public and private industry has provided renewed focus on the need to measure the service provision of both internal service related groups and external service providers. This is also increasingly the case for many groups outside of the traditional IT arena – and for these groups SLAs are fast becoming a vital tool for survival.
For internal service providers SLA’s provide a means of comparing internal levels of service provision with those available from external providers and to deal pragmatically with the threat of outsourcing.
For those groups receiving services SLA's provide a means of bench marking internal service provision so as to compare with that available from external parties, and so provide a framework for making considered outsourcing decisions. Where services have already been outsourced, SLAs provide these groups with a reliable mechanism for defining and measuring the services provided.
Not only do SLA's provide the basis for measuring service provision but also they are a powerful management and communications tool for both the service provider and the customer – resulting in the mutual benefit of both.