Service Level Agreement (SLA)

An SLA is a document that sets out the agreed-upon level of service between a provider and their customer. They are used to measure the success of the service provider‘s performance, but they also protect the provider by ensuring that both parties are on the same page regarding expectations. A clearly set out SLA means everyone involved knows what is expected from the partnership.

Items commonly included in an SLA are a description of the service to be provided, the acceptable and unacceptable levels of service, delivery timelines, payment terms, and how disputes are resolved. An SLA is a legally binding contract.

Tech companies and customer service teams commonly use SLAs. For tech, it often includes availability or uptime—how often the software of service is available to access and how much downtime will be expected and permitted. For customer service, a common metric for an SLA is response time—how long it takes staff to answer incoming calls.

One additional point to consider is that SLAs really only work with long-term partnerships. It requires constant communication and management from both the provider and the client.

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