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Service Level Agreement (SLA)

A Service Level Agreement, or SLA, is a contract between a customer and a service provider that outlines the level of service to be provided. The SLA sets a service standard and regulates the cooperation between the parties. The document is created by the service provider, and its content may vary depending on the customer's requirements or be the same for all. SLAs are widely used in the IT industry as well as other niches of digital services.

The service level agreement is usually based on specific metrics. The SLA specifies the maximum size of a certain indicator that is an indicator of the level of service. Evaluating the indicator allows the customer to draw conclusions about how successfully the service provider is fulfilling its obligations. A typical example of an SLA is a contract between a website owner and a data center, where the site is hosted on servers. The data center specifies the guaranteed uptime of the servers in the service level agreement, essentially making a promise to the website owner. If it turns out that the uptime of the servers was lower than promised, the website owner can make additional demands on the data center. For example, demand a free service period, termination of the contract, etc.

In addition to the metrics that determine the level of service, the SLA also includes:

  • a list and description of the services provided to the customer;
  • deadlines for the service provider's work;
  • obligations of each party;
  • sanctions for non-fulfillment of obligations for each party;
  • the procedure for collecting metrics to assess the level of service;
  • the procedure for resolving conflict situations;
  • the procedure for implementing changes to the service's operation;
  • the cost of services and payment terms.

The service level agreement is equally beneficial to all signatories. The SLA ensures transparent cooperation because it clearly defines the requirements for each party. In case of conflict situations, the parties can always refer to the contract and resolve the problem. This approach increases the customer's trust in the service provider and helps to establish good working relationships between them. The SLA does not just monitor, but also improves the quality of service. The service provider always knows the level he needs to strive for and maintains it. And the customer receives a positive user experience because he remains confident that his wishes will be fulfilled.

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