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What are customer based service level agreements?

Updated: 9/21/2023
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Anandvijayakumar

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12y ago

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A customer-based SLA is an agreement with a specific customer or customer group covering all the IT services they use. For example, a local authority education department might have a single agreement embracing payroll, school administration, human resources, purchasing, financial management systems, and so on. In some ways, this simplifies the relationship between IT and the customer, putting the customer's perspective to the fore. On the other hand, customer-based SLAs are complex and often difficult to agree and manage. Additionally, customers may be disappointed that the same service levels available to them, for common services such as email, for example, cannot be tailored to their specific needs.

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What are Service Level Agreements?

ITIL defines a Service Level Agreement (SLA) as an agreement between an IT service provider and a customer. The SLA describes the IT service, records service level targets, and specifies the responsibilities for the IT service provider and the customer. A single SLA may cover multiple IT services or multiple customers.


What are multi level service level agreements?

Some organizations choose a multi-level SLA approach, where elements of services common to all customers are covered by a corporate-level SLA. Issues relating to a particular customer or customer group, no matter what the service, are then covered by a customer-level SLA and all issues relating to a specific service for the customer or customer group are covered by a service-specific SLA. The SLA for a service must be based on realistic, achievable targets (e.g. for performance and availability), and the achievement of these targets depends on the performance of the internal and external services that underpin the delivery of the main service. Putting it another way, SLAs must reflect the levels of service actually being delivered or that can be delivered. They are about what can be done rather than what we would like to be done. If a customer requires a different level of service, this would normally be dealt with by raising a Service Level Requirement. In order for SLM to be confident about the achievement of its SLA targets, it must have specific agreements with the internal and external providers. These agreements fall into two distinct types: • Underpinning Contracts (UCs) • Operational Level Agreements (OLAs) Both should be negotiated, agreed and in place before a commitment is made to the relevant SLA.


Which process is responsible for reviewing operational level agreements OLAs on a regular basis?

Service level management


What is the main purpose of service level management?

The main purpose of Service Level Management is: • To develop and negotiate SLAs with customers • To ensure SLAs are underpinned by internal (OLAs) and external (UCs) agreements that support the achievement of agreed service levels • To act as a bridge between the IT service provider and the business • To manage and maintain positive, constructive relationships with the customer. As the primary interface between IT and the business, it must be kept up to date with all relevant developments.


What benefits Service Level Agreement do?

Where one party delivers services to another, it is a good idea to have some kind of agreement setting out the basis on which the service is provided. Such agreements would normally contain, among other things, a description of what is to be provided, the key performance indicators, the way the service is to be charged for (where relevant) and the responsibilities of each of the parties. In ITIL SLM, the agreements between the internal IT service provider and the business customers that it supports are known as Service Level Agreements (SLAs) and it is through SLAs that SLM manages the relationship between itself and its customers. It would be hard to find IT services provided by IT giants like TCS, Infosys, Wipro etc., where they do not have any accepted/agreed upon SLAs with their customers. In order to be effective, the SLA must be a written document signed off by all parties affected by it. SLAs are important so they will rarely be agreed without negotiation between the IT service provider and the customer, beginning with a Statement of Intent that sets out the terms, conditions and targets to be agreed. It has to be in a language that both sides will understand, and this means in the language of the customer and not the technical language or jargon of the provider. The SLA defines (in language that has meaning to the customer) precisely what is to be delivered and when and where it is to be delivered. It also defines the standard of quality to be delivered, usually in terms of performance and availability. It will define the responsibilities of both the service provider and the customer. This is important. It makes little sense for a service provider to commit to deliver a service without making it clear what is expected of the customer. The SLA will include contact details, what should happen if something goes wrong, the way any disputes should be handled, any provisions for redress, the mechanism for getting the SLA changed if necessary and the period over which the agreement will stand unless otherwise changed by agreement. If the service is to be charged for, then the way charges are to be determined and the arrangements for invoicing should be included. Charges may also be included in a separate document, the Tariff, referenced in the SLA. It is common in IT for individual services to be shared by a number of customers, and individual customers will use a range of services. This means that there is a choice in designing SLAs: they can be customer-based, where an SLA covers a range of services delivered to a particular customer; or they can be service-based, where a common SLA covers all customers of a given service.

Related questions

What are Service Level Agreements?

ITIL defines a Service Level Agreement (SLA) as an agreement between an IT service provider and a customer. The SLA describes the IT service, records service level targets, and specifies the responsibilities for the IT service provider and the customer. A single SLA may cover multiple IT services or multiple customers.


What are multi-level Service Level Agreements?

Some organizations choose a multi-level SLA approach, where elements of services common to all customers are covered by a corporate-level SLA. Issues relating to a particular customer or customer group, no matter what the service, are then covered by a customer-level SLA and all issues relating to a specific service for the customer or customer group are covered by a service-specific SLA. The SLA for a service must be based on realistic, achievable targets (e.g. for performance and availability), and the achievement of these targets depends on the performance of the internal and external services that underpin the delivery of the main service. Putting it another way, SLAs must reflect the levels of service actually being delivered or that can be delivered. They are about what can be done rather than what we would like to be done. If a customer requires a different level of service, this would normally be dealt with by raising a Service Level Requirement. In order for SLM to be confident about the achievement of its SLA targets, it must have specific agreements with the internal and external providers. These agreements fall into two distinct types: • Underpinning Contracts (UCs) • Operational Level Agreements (OLAs) Both should be negotiated, agreed and in place before a commitment is made to the relevant SLA.


What are multi level service level agreements?

Some organizations choose a multi-level SLA approach, where elements of services common to all customers are covered by a corporate-level SLA. Issues relating to a particular customer or customer group, no matter what the service, are then covered by a customer-level SLA and all issues relating to a specific service for the customer or customer group are covered by a service-specific SLA. The SLA for a service must be based on realistic, achievable targets (e.g. for performance and availability), and the achievement of these targets depends on the performance of the internal and external services that underpin the delivery of the main service. Putting it another way, SLAs must reflect the levels of service actually being delivered or that can be delivered. They are about what can be done rather than what we would like to be done. If a customer requires a different level of service, this would normally be dealt with by raising a Service Level Requirement. In order for SLM to be confident about the achievement of its SLA targets, it must have specific agreements with the internal and external providers. These agreements fall into two distinct types: • Underpinning Contracts (UCs) • Operational Level Agreements (OLAs) Both should be negotiated, agreed and in place before a commitment is made to the relevant SLA.


What has the author Dinesh Verma written?

Dinesh Verma has written: 'Supporting service level agreements on IP networks' -- subject(s): Customer services, Computer service industry, Internet industry, Service-level agreements, Technischer Kundendienst, Rechnernetz 'Relative Happiness'


What is Zone of indifference in customer service?

Zone of indifference is a service level where your customer service is forgettable!


What is effective service level?

An effective service level is one where the customer or client is satisfied. The sales person or customer service rep delivers superior service.


What is the customer service level?

The Customer service level rin a supply chain is a function of several different performance indices.


Which process is responsible for reviewing operational level agreements OLAs on a regular basis?

Service level management


How do service level agreements SLAs enable you to ensure maximum customer satisfaction?

By providing a guarantee that contracted services will be delivered as per agreement By including penalties if contracted services are not delivered By allowing you to negotiate the highest level a provider can guarantee


How do you measure customer level of satsafaction?

You can measure the customer's level of satisfaction based on the feedback that he will provide.


What is the cycle of life called?

1. Provide first-call & second-call resolution and support. 2. Record and track Incidents and Service Requests. 3. Monitoring and applying escalation procedures relative to Service Level greements. 4. Managing the Service Call life-cycle, including closure and verification. 5. Achievement of Service Desk contracted Customer Service Level Agreements.


Limit level of customer service to balance customer satisfaction with organisational goals?

. Give at least two examples of when customer service may be limited by organisational goals.