Service Level Agreement (SLA) is a detailed document regulating the relationship between the customer and the contractor, containing a detailed description of each option, its quality, response time and execution of the service provided.

For the first time this abbreviation appeared in the sphere of information technologies. Today, thanks to its convenience and specificity, it is used in various areas of business.

But what is the difference between a contract and a service level agreement? A contract is generally defined as an agreement between two or more parties that is enforceable by law. It is this legal document that sets out the services to be provided, the duration, cost, resources, approach, assumptions, etc.

The SLA will focus only on measuring the effectiveness and quality of services agreed upon by both parties and can be used as a measurement tool within the contract.

Sections of the agreement depend on the nature of the service provided, but there are a number of the most common points:

  • list of services provided;
  • the time when services will be provided;
  • testing and modernization;
  • indicators of declared infrastructure reliability;
  • deadlines for the termination of the agreement;
  • mutual responsibility of the parties;
  • the procedure for resolving controversial issues;
  • the procedure for compensation for failure to comply with the agreement.

When drafting the agreement, special attention should be paid to the quality of services provided. The following points should be devoted to it:

  • optimal time of the performer’s response to the problem;
  • VIP-client service parameters;
  • minimum availability of the service, its specific services and services;
  • the maximum period of solving the problems that arise.

The standard for creating an SLA is that a company already has a number of indicators that it wants to achieve and some key performance indicators (KPIs) that will allow it to assess whether a service provider is performing well. The choice of key performance indicators depends entirely on the specifics of the business. The most popular of them are service availability, defect rates, technical quality, security and business results.


The most common sections of the service level agreements:

Delivery time varies greatly when it comes to different support channels. Social media advocacy needs to be done very quickly to avoid negative public experience, while e-mail is often considered a slower channel. Chat downtime should also be very low, and waiting times for phone calls can vary from 30 seconds to 3 minutes.

 Customer satisfaction is one of the most important SLAs and a key performance indicator in today’s business world. A company must find a way to make and keep its customers happy, while maintaining a balance of how much it spends to do so. The industry standard ranges from 80% to 95%.

Ticket or incident resolution is another SLA that gets a lot of attention. In this case, the SLA measures how many client requests have actually been processed. This can be measured either by means of order closure indicators, customer surveys or technical indicators (e.g. how many repair orders have been submitted or executed).

On the other hand, SLA is necessary not only for B2C companies, but also for B2B (business-to-business). Given the fact that many companies are already striving for a high level of service, it is necessary to consider the reasons for the implementation of the agreement on the level of service and profit.

First and foremost, service level agreements strengthen customer relationships. Second, a good SLA strategy can increase sales. Finally, a carefully drafted agreement can also be used by employees as a resource for complex conversations.

In conclusion, SLAs are especially important in IT but any type of business can benefit from a document of a similar kind, even though it may not have the same name. If company want to maximize its profit potential and minimize risks, it should write SLA.