Defining the perfect SLA and how to manage it

In today`s highly competitive marketplace, service offerings and accompanying service-level agreements (SLAs) are becoming increasingly important with the focal point on industry leading service providers. To stay afloat as a service provider, you need to prove to customers that they are getting the highest levels of availability and performance required to handle their critical business needs.

Regardless of the type of services that you offer, SLAs have become a common thread for effectively measuring services, while providing an advantage for differentiation in an increasingly competitive and crowded market. Between parties, SLAs can act as a tangible contract, which helps ensure the service provider is delivering mission-critical services at pre-negotiated levels or pays the penalty -- after all, no one wants to lose money.

You can`t guarantee what you can`t manage and you can`t manage what you can`t define. It is considerably confusing to define what actually constitutes a service and how services are delivered. These are complex issues for service providers that now cover the various components of Internet-based services.

Service providers range from network access providers who focus on physical transport and network security to hosting providers who focus on environmental control and security, network connection, server and application management, to the outsourced services provider who offers design deployment and management of e-business environments and application services.

The answers, of course, depend on the customer who will determine what type of SLA can best help them meet their business objectives. SLAs should consist of most or all of the following metrics.

* Availability
* Response time
* Reliability
* Utilisation
* Error rates

Service providers who develop comprehensive real-time SLAs uniquely customised for each customer`s specific business needs will reap a significant competitive advantage over those offering generic SLAs. In this intensely competitive and lucrative e-business market, SLAs can easily make or break large accounts.

Fortunately, the technology supporting the management of SLAs has grown significantly enabling savvy service providers to offer progressive custom SLAs and providing the tools to manage each supporting element in real-time.

This type of effective service level management can make the difference between winning and losing customers in an intensely competitive and fast-paced market, where downtime and access problems cost tens of thousands of rands per minute.

A successful service assurance solution must do more than keep pace with evolving Internet technologies. It must also effectively manage the service provider`s total service infrastructure and scale quickly and easily to handle rapidly expanding customer bases, growing e-channels and increasing application delivery, in order to support future business models and opportunities.

SLAs are typically considered contracts between a service provider or carrier and the external business purchasing these services. Service provider-to-customer SLAs represent the vast majority of SLAs being used today. However, many service providers are monitoring internal service levels to track their own infrastructures and the systems used to deliver services to customers. Some even provide internal SLAs to departments and end-users within the organisation.

Although internal SLAs seldom carry the financial responsibility and liability that external SLAs do, they ensure the delivery of vital information to the provider, enabling them to effectively define and manage services and infrastructure. In fact, the use of internal SLAs is steadily rising to help service providers manage the growing number of multi-vendor technologies and applications responsible for delivering customised services to a very diverse customer base.

Ultimately internally monitored SLAs, once they have been validated and trended, can be rolled out to external customers. In this way service providers can develop next-generation SLAs ahead of their competitors that can be released with confidence knowing that they can meet the SLA.

In order to deliver effective e-business solutions, the service provider industry currently encompasses various levels of providers vying to fulfil specific resource and management needs to meet the Internet-centric business needs of their customers.

At the top of the food chain, a single provider is responsible for offering customers an end-to-end SLA encompassing many of the SLAs delivered by a collective group. This is a challenge not only from a definition standpoint but also from a monitoring and policing standpoint.

This scenario is fuelling the demand for management solutions that can monitor SLAs between partnering service providers, measuring the availability and performance of the complementary services that it purchases from partners, affiliates and counterparts. Some providers maintain SLAs from multiple ISPs as their customers choose to spread out their mission-critical e-business services to various providers. In fact, some companies hire a third-party company just to monitor its various Internet deliverable services.

According to Meta Group, service level management (SLM) is among the most complex, challenging and misunderstood IT processes. Due to the lack of formal definition and implementation, the process has many owners and interpretations of user expectations that usually lead directly to `perceived` service issues.

Successful service providers must deploy a management strategy that can accommodate rapidly growing, disparate and sometimes fragmented, infrastructures and manage them within a single environment where end-to-end visibility of service performance and availability can be assessed.

Service providers must also continue to merge and acquire other service providers, forcing them to integrate different systems and management architectures into existing platforms. They need tools to help ease this transition by linking disjointed management tools. They also need solutions that can scale to support extremely large infrastructures and still provide a consolidated, real-time view of network and service status.

Service providers must thoroughly evaluate potential service level management solutions as they would a dealmaker for future business opportunities. The following is a list of factors the service provider should consider when selecting a management strategy:

* Deliver a big picture of all Internet services and technologies that contribute to Internet-based services.
* Support future growth with a highly scalable solution that can quickly incorporate new services and users.
* Service-oriented approach that monitors service levels providing both real-time presentation and historical analysis.
* Monitor service levels from multiple providers, ensuring service level agreements between partners are met.
* Provide end-to-end management of all IT systems and services.
* Leverage existing IT investments by integrating with multi-vendor systems instead of replacing them.
* Facilitate proactive management to prevent problems that could disrupt services.
* Provide component-level status information and associate it with the services they support, and the customers who have access to them.
* Provides clear visibility of providers` Internet services and infrastructure.
* Translate network status event data into a business view so operators can check the overall health of its services in real-time.
* Consolidate event feeds from numerous devices and applications onto one service management console.

Although a SLA might seem relatively simple in theory, it is a much more complex exercise in practicality. Ensuring the customer`s specific requirements are incorporated and creating measurements to monitor the SLA add a new dimension of complexity. However, once defined and outlined, the benefits are immediately apparent to both customer and service provider, forging a mutually satisfying partnership.