Faced with the challenge of squeezing the most out of shrinking IT budgets, IT decision-makers are taking a long, hard look at how and where they allocate funding for their technology support. The challenge for IT is to find ways to "do more with less" without compromising service delivery. It may be viewed as "the plumbing" - but without it, many businesses would grind to a halt. The risk is that making decisions that yield short-term gains can result in irreparable damage to the business in the medium and long term. It's a critical balance to manage, says Brent Flint, Services Executive: Dimension Data Middle East and Africa.
Now more than ever, it's essential to keep existing clients and at least maintain current business, if not grow it, while working to bring new clients to the business. Is it really possible to reduce operating expenditure while maintaining service levels and not put the operating ability of the enterprise on the line? We think the answer is "yes". Adopting a more analytical approach to service level management can go a long way to making sure you are making the right decisions when managing cost-efficient service levels.
When it comes to service level agreements (SLAs), one size doesn't fit all - the key to making sure you are not over or underinsuring your assets is to scrutinise the business-criticality of the different services. Let's take a look at how this would work in practice:
Step one: Identify and prioritise business goals and objectives
In order to make informed decisions on where to channel your investment in support services, you'll need to undertake a thorough evaluation of all your organisation's ICT services, establish how critical they are to the achievement of your business objectives, and ascertain the business impact of the failure of each of these services. Ideally, this should be undertaken in collaboration with your business unit stakeholders.
In addition, consider spending time with different groups of IT users and gaining an understanding of how they perceive the various services and what they think is important for business success or failure.
Once the criticality and recovery time objective for each service have been identified (that is, the maximum length of time the company can afford to be without the service), this information can be used as a basis for establishing the required levels of availability and reliability for each discrete service. Most organisations will not and should not attempt to manage every conceivable service at a 'nine-to five' availability level. Besides being far too expensive, it would simply not add value to the business.
Bear in mind that it is quite likely that service levels may differ from location to location and between different business units. For example, certain services such as e-mail, Internet access, VOIP and common business applications such as Microsoft Office, are used by everyone, everywhere and all the time. At the same time, business units will have vastly different needs in areas such as database constructs and specialised industry applications and tools. These variables all need to be considered and assessed.
Step two: Rank each service according to its business criticality
The next step in the process is to sort the various services into 'tiers'. Tier One services would typically require the highest availability and apply to mission-critical applications or services where any loss of service would result in severe financial loss. At the other end of the scale, Tier Five services would include less business-critical applications or services, for which a loss of service spanning a number of days may result in client concern.
There may be many different tiers, with the requirements for each tier adapted to the organisation's particular needs. Naturally, Tier One services will require more funding than Tier Four or Tier Five services - after all, resilience costs money, and capacity on-demand, storage on-demand and disaster recovery arrangements would need to be built into the system design in these areas, which will have an impact on the support costs.
Performance issues in Tier Five areas, which may include database applications, for instance, while always irritating to end-users, do not require the same zero-tolerance approach as service availability problems. A lower SLA threshold can then be specified, and the associated cost could be decreased.
Step three: Engage with your service provider
Having a clear understanding of your organisation's service requirements across your entire IT estate is critical to making informed decisions around where and how to channel your investment in support services, but it is equally important that your service provider is on board. A collaborative approach between client and service provider can go a long way to developing support contracts that hit the mark.
The results of a recent Dimension Data survey revealed that a significant percentage of organisations (26%) report that they work closely with their service providers to determine SLA metrics. This is an encouraging statistic, especially the move to engagements that are flexible enough to meet the organisation's unique business needs and service level requirements.
Given the growing interest in variable SLAs, service providers need to be flexible and not impose a 'one size fits all' approach on their clients. Taking into account the current economic climate, organisations are going to be on the lookout for partners that have a comprehensive suite of service level offerings, which allow them to pick and choose between different service levels according to their specific business requirements and budgets.
More and more, clients will be asking questions such as: "For less business-critical services, can you offer me a 9x5 next business day SLA, but perhaps also allow me to opt into a 24x7x365 restore SLA for another area of my infrastructure where I can't afford to have failures in service?" Or, "Flexibility is key: Do I have the option of engineer on-site versus an engineer to site? If it's a business-critical service, can I opt into having a dedicated service delivery manager?" and so on.
Our guidelines for the way forward
The recent economic downturn has sent enterprises around the globe into cost-cutting mode and many CIOs are scrambling to find ways to do more with less. The good news is that, for most organisations, real possibilities exist for reducing support service costs without compromising service levels through undertaking a thorough and detailed review of the organisation's existing service level management strategy. The level of success will depend on your ability to link the business objectives to underlying IT performance and to identify the critical success factors of the underlying IT infrastructure.
At the same time, close and ongoing consultation with business unit stakeholders will pave the way for the creation of SLAs that are sufficiently business-aligned to create meaningful and effective parameters for service delivery. Last, but not least, remember that engaging collaboratively with service providers in strategic, outcomes-based conversations can go a long way to crafting the optimum suite of SLAs that match both your business requirements and your budget.
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