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Blueprint for an Exchange Service Level Agreement

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Contract Specifics and Context

Management of the SLA is a critical part of supporting end users. Before we can determine if objectives have been met, we must first identify metrics and the specifics of the contract.

Contacts and Role assignment

First, name the key contact to the Service Level Agreements and delegate SLA management tasks to others. Other contacts for the SLA include:

 ABC Company:

Management

Exchange connection into other corporate systems

            Management of 3rd Party Outlook/Exchange Development

            Application Development

Remote and Dial-in Access 

Reporting

The frequency and detail of reports must be identified as well. Reporting can then be further broken down into two techniques:

  • Automated system reporting should be implemented in order to provide current and historical data. This data should be made available to the above named contacts on a regular basis. The methods for providing reports to the named contacts may include a secured website or electronic mail attachments. Hard copies of the reports may also be requested. The reports, for these contacts should be fully detailed reports with data analysis and a trend summary for the month. Moreover, historical data should probably be included.

  • It may be necessary for regional and divisional managers to receive a summary report/graphic depicting uptime and overall system performance once a month, similar to the graph depicted to the right.

ABC Company may also require that an automatic mechanism be put into place to notify the named contacts when critical performance thresholds are met. Specific thresholds are discussed later in the document.

Questionnaires and end-user canvassing methods should also be performed by ABC Company and/or the Outsourcing Company as part of an overall customer service initiative.

Finances

Payment terms and contract length are negotiated with the outsourcing vendor. ABC Company may prefer a contract length of six months, but will consider contracts as long as one year. Renewals can be handled in many ways including automatic six month extensions. Both ABC Company and the outsourcing vendor should be able to request a formal renewal meeting to update the SLA with riders and to negotiate new terms.

There are two types of terminations possible:

  1.        
    Contract Termination- Indicates that either ABC Company or the outsourcing company elects to terminate the contract. A “Technology Transfer” and associated fee would probably be required in order to shift the maintenance and support to another group.

  2. Technology Termination- A termination in technology would occur when the support requirements are no longer required due to a shift in ABC Company technologies. This form of termination may or may not require a formal “Technology Transfer.”

Termination Options are described as follows:

  • ABC Company may reserve the right to cancel the contract for either termination option with 60 days notice to the outsourcing company. ABC Company understands that there may be financial penalties for “Contract Termination” if the SLA objectives were met by the outsourcing vendor. These penalties often reflect the fee for one month of support.

  • The outsourcing vendor may reserve the right to “Cancel Termination” with 180 days notice to ABC Company. A “Technology Transfer” fee would be charged to cover labor costs associated with transferring the knowledge and technology to another group.

 Review Process

There should be a formal review to evaluate the performance and customer service levels as well as staff reviews. A quarterly review is sometimes formalized in order to include discussions on SLA fulfillment, staffing and future projects that may affect the SLA.

Change Management

Service Level Management is accomplished by negotiating a change or additional to an existing Service Level Agreement. Out-of-scope or new projects need not be discouraged. A change process occurs during every review process and can also be instigated as needed. Several things could require a change or addendum to the existing SLA:

  • A change in the process workflow

  • Additional services

  • Missed performance or customer service thresholds

  • Additional third-party applications

Changes are not made directly to the SLA. Instead, contract riders are appended to the SLA until such time that the SLA is rewritten to incorporate the addendums. The SLA can only be written during a renewal cycle with both parties present.

Financial Incentive Plan

Most groups believe that the total cost of ownership (TCO) is more a function of cost of service and support of the system than a function of the cost of hardware and software. SLAs can drive down TCO by identifying damages for missed service levels.

In the case of ABC Company, a third party may be asked to provide evaluations to determine if service level objectives have been met. The costs associated with the third-party evaluations are the responsibility of the party requesting the evaluations.

Penalties and bonuses for SLA performance guidelines could be “paid” quarterly. Performance objectives are met based on a +10/-10 (percent?) allowance. Penalties are paid as a deduction of regular costs for the pay period immediacy following the review cycle. Bonuses are paid with four weeks of the review cycle and do not require a separate purchase order from ABC Company.

Blueprint for an Exchange Service Level Agreement

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Copyright Stephen Bryant 2008