What is an SLA in ITIL?

A service level agreement , also known as an SLA, is an agreement between a customer and an IT service provider laying out service expectations for both parties. It’s essentially a contract promising certain service levels to the client—with specific and measurable minimum services—in return for payment. The agreement can be either legally binding or informal, but in either case, the expectation is that the service provider will uphold their end of the agreement. There are three different types of SLAs, all of which are designed and negotiated through a process called SLA management. The specific contents of the SLA depend on the type of agreement and the services provided in each case. However, the components typically included in most SLAs include: Detailed information on the scope of the services promised. This includes detailing the guarantees, priorities, and responsibilities of the service provider. Guidelines for tracking and reporting on provided services. Procedures for problem management and disaster recovery. Information on the customer’s duties. Details on the fees and expenses for the services provided, as well as clauses addressing termination of the SLA. It’s important to remember an SLA isn’t meant to be unchanging. One central element of service level management is reviewing and revising SLAs following any change or update to the service. Depending on the type of SLA you have in place, it may require updates at a different rate than other types. With an SLA in place, the relationship between a customer and an IT service provider can run far more smoothly, thanks to a clear record of expectations for both parties.

What are the three types of SLA?

The three types of SLAs are: a service level SLA, a customer-based SLA, and a multi-level SLA. One key element of IT SLA management is determining the most appropriate type of agreement for your specific needs and the services being provided. The first step to determining which SLA you need is understanding the three different types: Service Level SLA - This type of SLA covers one level of service for all customers. In this scenario, all the customers will receive the same level of service. An example of a service level SLA is the agreement a mobile service provider offers. All the provider’s customers receive the same level of maintenance and guarantees of service for the same cost. Customer-based SLA - The second type of SLA is essentially the inverse of the service level SLA. While the latter provides for one service being promised to a large group of customers, the customer-based SLA provides for multiple services being promised to one customer or customer group. For example, a customer-based SLA might involve an agreement between the finance department for a large organization and an IT service provider. The service provider would offer various services to the finance department, and a customer-based SLA could encompass a single agreement covering all those services for that customer. Multi-level SLA - The final type of SLA is split into multiple levels, addressing different sets of customers for the same services. Although customers at each level are guaranteed service from the product, the specifics and levels of service provided will vary between them. With a multi-level SLA, all these different specifications are included in a single SLA.

What is the objective of a service level agreement?

The objective of an SLA is to have an agreement to protect both parties. Service level objectives (SLOs) are meant to ensure businesses can run smoothly, thanks to a clear, predetermined framework that guarantees to delivery of promised services. SLA monitoring, a central element of service level management, ensures that the service provider delivers on the promised levels of service in alignment with current business goals. For an SLA to be able to fulfill its objective of protecting both the customer and the service provider, it needs to include several critical elements. It must: Specify the type of service being provided with as much detail as is necessary on the type of service. Include the desired (and expected) level of performance for the service. Particular attention should be paid to the expected responsiveness and reliability of the service. Lay out how the levels of performance will be monitored and supervised. This typically involves determining which types of statistics will be collected, as well as how often and in what way the customer will assess those statistics. Have steps for reporting a problem with the service. This includes details on the person responsible for handling problem reports and the order in which details should be reported. The SLA also needs to include a timeframe for when the problem will be looked at and resolved. Include the repercussions for the service provider if they fail to meet the commitments outlined in the SLA. These repercussions can include the customer being able to ask for a refund for the losses they incurred as a result of the failure of service. They can also include the customer's right to terminate the contract.

What is SLA management?

SLA management, also known as service level management, is the process of comparing actual service performance with the predefined expectations for performance outlined in the SLA. As part of this, SLA management also involves creating and revising SLAs as needed, with updates to services and the customer’s evolving needs. SLA management oversees and is involved in every step of the service level agreement process. It helps define expected levels of service performance and documents those expectations within an SLA. It guides effective SLA monitoring by measuring performance statistics and reporting on them to determine whether the service provider is fulfilling its obligations. In addition to making sure the SLA is fulfilled, SLA management also monitors customer satisfaction, so the IT service provider can make sure they’re providing value to the customer as compared to competitors. Customer satisfaction often goes hand in hand with other elements of service level management, like ensuring the successful fulfillment of the SLA. SLA management can help ensure that service providers meet or exceed their customers’ expectations.

Why is SLA management important?

SLA management is important because it provides a framework for creating an SLA and then allows you to assess whether the quality of services you’re providing or receiving matches what was agreed upon in the SLA. Without an SLA, there will be no clarity on what happens if one of the parties fails to uphold their end of the agreement between the service provider and the customer. This means neither party is protected in case of a failure to deliver on the promises. Whether or not an SLA is legally binding, it’s still important because it lays out the expectations for both parties in writing, so no one has to wonder what they can expect. With an SLA, you provide transparency and clarity for your customers and yourself. SLA management means you can be confident that both parties have the same expectations for service without wasting time trying to determine what quality of service the customer expects. SLA management is also important because it allows you to monitor customer concerns over service performance. If you have a software tool to aid with service level management, you can see all your tickets about performance issues together, so you can better monitor customer satisfaction and overall service performance. SLA management is important because it allows your business to run smoothly without needing to worry about unknown service expectations.

Common SLA Metrics: What is worth measuring in ITSM tools?

Defining service targets can be tricky if you aren’t sure where to start. After all, there are plenty of metrics, but not all are worth measuring with ITSM SLA tools. Measuring too many metrics with service-level monitoring tools can prove to be counterproductive and overwhelming to your SLA helpdesk, so you’ll want to be selective. To better understand your performance, you’ll want to measure: Mean Time To Resolve (MTTR) : The MTTR is the average time taken to resolve an incident once it has been reported to the service desk. Generally, the faster issues are resolved, the quicker people can return to work, and the more satisfied everyone will be. Response Time : Response time is one of the most critical SLA metrics to track. Customers submit tickets because they need help, and your team should be able to assist them as quickly as possible to enhance the customer experience and satisfaction. Guaranteed Service Uptime : Using SLA (Service Level Agreement) monitoring tools, it’s possible to measure service uptime and outages, which is the percentage of time a system is available and operational. First-Contact Resolution Rate : This metric is the percentage of issues resolved during the client’s first interaction and can provide insights into customer satisfaction and agent effectiveness. SLA Breach Rate : This rate indicates the percentage of tickets that have breached an SLA. A higher SLA breach rate can indicate a staffing shortage or a need for better training. Number of Tickets Resolved : It’s also a good idea to keep track of how many tickets are resolved over a period of time. This will give you an idea of how your team is performing. Incident Escalation Rate : By measuring the frequency at which incidents need to be escalated to higher support tiers or teams due to complexity or severity, you can determine areas for improvement.

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SolarWinds Service Desk provides service level management software to define, apply, monitor, and report on service level agreements (SLAs). IT teams can set service level targets for response time and resolution time, apply SLA policies to incidents and service requests, monitor SLA timers, and identify tickets approaching or past an SLA breach.

As part of a connected IT service management (ITSM) platform, Service Desk helps teams connect SLA management with incident management, service requests, change management, service catalog workflows, assets, and configuration items in the CMDB. Use service-level data to prioritize support work, evaluate service delivery, and report on performance metrics that matter to employees and stakeholders.

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Simplify SLA management across IT services

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Service level management (SLM) is the practice of defining, monitoring, and improving agreed service levels. An SLA documents the expected level of service for a particular service, request type, customer group, or support commitment. It may include targets for initial response, resolution, availability, communication, or other measures that reflect how a service is delivered.

SolarWinds Service Desk helps IT teams manage SLA policies from a central service desk. Teams can define SLA rules, set targets, establish the scope of each rule, and specify actions that should occur when a ticket reaches a pre-breach or breach threshold. This creates a more consistent approach to SLA management across the IT support organization.

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Set service level targets for incidents and requests

Service level targets define the level of support an IT service provider intends to deliver. For example, a team may set different response-time and resolution-time targets based on incident priority, business impact, request category, service, customer group, or support tier.

Service Desk enables teams to create SLA rules by defining targets, scopes, timer thresholds, and associated actions. Teams can use these rules to establish more consistent expectations for incident management and service-request fulfillment, while adapting their SLA policies to their own service model and operational priorities.

For internal IT teams, these targets can guide support priorities and employee communication. For service providers, targets may reflect commitments defined in customer agreements or operational agreements with supporting teams.

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Monitor SLA timers and response commitments

SLA monitoring gives IT teams visibility into tickets that require attention before a target is missed. In SolarWinds Service Desk, incident records can display SLA Breaches and Next Breach information, including color-coded timers that indicate whether a ticket has not reached a pre-breach threshold, is approaching a breach, or is at risk of breaching its SLA.

Teams can use this information to prioritize queues based on which incident is expected to breach next. SLA timers begin when an incident is created; recategorizing an incident does not restart its timer or change the original breach date and time. That helps preserve a consistent view of performance against the selected service target.

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Manage SLA breaches with alerts and escalation paths

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An SLA breach occurs when a ticket does not meet its defined service-level target. Instead of treating a breach as only a reporting outcome, teams can use alerts and escalation paths to bring attention to tickets before the target is missed.

In Service Desk, teams can configure SLA-rule actions that occur when a breach condition is reached. This can support timely communication, queue management, reassignment, or escalation based on the organization’s defined workflow. Reviewing recurring SLA breaches can also help teams identify where staffing, routing, service design, knowledge content, automation, or underlying technical issues may need attention.

For recurring service interruptions, link related incidents to problem management so the team can investigate the underlying cause. If remediation requires a planned change, connect the relevant change record to retain context across the ITSM workflow.

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Report on service performance and KPIs

SLA reporting helps teams understand whether service-level targets are being met and where service delivery may be improving or declining. In addition to breaches, useful service level management KPIs can include response time, resolution time, ticket volume, priority distribution, reopen rates, request-fulfillment performance, and Mean Time to Resolve (MTTR).

SolarWinds Service Desk includes built-in reports and supports custom reporting for ticket status, technician performance, optimization opportunities, and customer-service needs. Teams can use those reports to review SLA performance by service, ticket type, support group, or other relevant criteria, then share results with IT leadership and stakeholders.

Service-level reporting should support decisions, not only scorekeeping. For example, an increase in resolution time for a service may point to a knowledge gap, an assignment bottleneck, insufficient capacity, a recurring problem, or a dependency that needs to be addressed through change management.

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Some common FAQs are…

What is an SLA in ITIL?
What are the three types of SLA?
What is the objective of a service level agreement?
What is SLA management?
Why is SLA management important?
How does service level management software work?
Common SLA Metrics: What is worth measuring in ITSM tools?

A service level agreement, also known as an SLA, is an agreement between a customer and an IT service provider laying out service expectations for both parties. It’s essentially a contract promising certain service levels to the client—with specific and measurable minimum services—in return for payment. The agreement can be either legally binding or informal, but in either case, the expectation is that the service provider will uphold their end of the agreement.

There are three different types of SLAs, all of which are designed and negotiated through a process called SLA management. The specific contents of the SLA depend on the type of agreement and the services provided in each case. However, the components typically included in most SLAs include:

Detailed information on the scope of the services promised. This includes detailing the guarantees, priorities, and responsibilities of the service provider.

Guidelines for tracking and reporting on provided services.

Procedures for problem management and disaster recovery.

Information on the customer’s duties.

Details on the fees and expenses for the services provided, as well as clauses addressing termination of the SLA.

It’s important to remember an SLA isn’t meant to be unchanging. One central element of service level management is reviewing and revising SLAs following any change or update to the service. Depending on the type of SLA you have in place, it may require updates at a different rate than other types.

With an SLA in place, the relationship between a customer and an IT service provider can run far more smoothly, thanks to a clear record of expectations for both parties.

Service level management software can help your organization manage and monitor the level of service you receive from vendors or the level of service you provide to your customers and employees. Service level management involves defining, tracking, and ensuring any agreed-upon service levels are met—and SLA management software simplifies the entire process.

You'll need to define your SLAs to get the most out of your SLA management software. By establishing acceptable performance metrics and targets, based on current business needs, in advance for various services, you can ensure that all tickets are responded to and resolved within a reasonable timeframe. These SLAs could cover aspects such as response time, resolution time, uptime, availability, and other key metrics.

Once you have defined your SLAs, the software can continuously monitor and measure relevant metrics from your systems, applications, and networks to ensure they perform as expected. If the software detects any SLA breaches or potential breaches, it can notify your team. Some solutions rely on email; others send SMS messages or dashboard notifications.

Many SLA tracking systems also aggregate data collected over time to provide a historical record, which can offer valuable insights. For example, you can gain a better understanding of recurring issues and identify trends. If you notice that your team is regularly missing SLAs, it could be a sign that your agents are overloaded and either need better ways to deflect tickets or more team members to share the workload. Access to data collected over time can also help you pinpoint areas for improvement. For example, you may notice one of your current processes isn’t as effective as you had hoped, your technology needs upgrading, or you need to alter how you allocate resources.

Some IT SLA management software solutions will also automatically take action when SLA performance crosses certain thresholds. For example, an automatic escalation process may begin if response time exceeds the SLA limit, saving your service desk SLA team time and energy.

IT service level management tools can offer the SLM software functionality you need. For example, SolarWinds’ Service Level Management is a function within Service Desk, an IT Service Management (ITSM) solution.

Overall, service level management tools help organizations maintain a high standard of service by providing real-time insights into performance, enabling them to prioritize tickets appropriately and take actions to prevent SLA breaches, leading to a better experience for all involved.

A service level agreement, also known as an SLA, is an agreement between a customer and an IT service provider laying out service expectations for both parties. It’s essentially a contract promising certain service levels to the client—with specific and measurable minimum services—in return for payment. The agreement can be either legally binding or informal, but in either case, the expectation is that the service provider will uphold their end of the agreement.

There are three different types of SLAs, all of which are designed and negotiated through a process called SLA management. The specific contents of the SLA depend on the type of agreement and the services provided in each case. However, the components typically included in most SLAs include:

Detailed information on the scope of the services promised. This includes detailing the guarantees, priorities, and responsibilities of the service provider.

Guidelines for tracking and reporting on provided services.
Procedures for problem management and disaster recovery.
Information on the customer’s duties.
Details on the fees and expenses for the services provided, as well as clauses addressing termination of the SLA.
It’s important to remember an SLA isn’t meant to be unchanging. One central element of service level management is reviewing and revising SLAs following any change or update to the service. Depending on the type of SLA you have in place, it may require updates at a different rate than other types.

With an SLA in place, the relationship between a customer and an IT service provider can run far more smoothly, thanks to a clear record of expectations for both parties.
The three types of SLAs are: a service level SLA, a customer-based SLA, and a multi-level SLA. One key element of IT SLA management is determining the most appropriate type of agreement for your specific needs and the services being provided. The first step to determining which SLA you need is understanding the three different types:

Service Level SLA - This type of SLA covers one level of service for all customers. In this scenario, all the customers will receive the same level of service. An example of a service level SLA is the agreement a mobile service provider offers. All the provider’s customers receive the same level of maintenance and guarantees of service for the same cost.

Customer-based SLA - The second type of SLA is essentially the inverse of the service level SLA. While the latter provides for one service being promised to a large group of customers, the customer-based SLA provides for multiple services being promised to one customer or customer group. For example, a customer-based SLA might involve an agreement between the finance department for a large organization and an IT service provider. The service provider would offer various services to the finance department, and a customer-based SLA could encompass a single agreement covering all those services for that customer.
Multi-level SLA - The final type of SLA is split into multiple levels, addressing different sets of customers for the same services. Although customers at each level are guaranteed service from the product, the specifics and levels of service provided will vary between them. With a multi-level SLA, all these different specifications are included in a single SLA.
The objective of an SLA is to have an agreement to protect both parties. Service level objectives (SLOs) are meant to ensure businesses can run smoothly, thanks to a clear, predetermined framework that guarantees to delivery of promised services. SLA monitoring, a central element of service level management, ensures that the service provider delivers on the promised levels of service in alignment with current business goals.

For an SLA to be able to fulfill its objective of protecting both the customer and the service provider, it needs to include several critical elements. It must:
Specify the type of service being provided with as much detail as is necessary on the type of service.
Include the desired (and expected) level of performance for the service. Particular attention should be paid to the expected responsiveness and reliability of the service.
Lay out how the levels of performance will be monitored and supervised. This typically involves determining which types of statistics will be collected, as well as how often and in what way the customer will assess those statistics.
Have steps for reporting a problem with the service. This includes details on the person responsible for handling problem reports and the order in which details should be reported. The SLA also needs to include a timeframe for when the problem will be looked at and resolved.
Include the repercussions for the service provider if they fail to meet the commitments outlined in the SLA. These repercussions can include the customer being able to ask for a refund for the losses they incurred as a result of the failure of service. They can also include the customer's right to terminate the contract.
Defining service targets can be tricky if you aren’t sure where to start. After all, there are plenty of metrics, but not all are worth measuring with ITSM SLA tools. Measuring too many metrics with service-level monitoring tools can prove to be counterproductive and overwhelming to your SLA helpdesk, so you’ll want to be selective.

To better understand your performance, you’ll want to measure:
Mean Time To Resolve (MTTR): The MTTR is the average time taken to resolve an incident once it has been reported to the service desk. Generally, the faster issues are resolved, the quicker people can return to work, and the more satisfied everyone will be.
Response Time: Response time is one of the most critical SLA metrics to track. Customers submit tickets because they need help, and your team should be able to assist them as quickly as possible to enhance the customer experience and satisfaction.
Guaranteed Service Uptime: Using SLA (Service Level Agreement) monitoring tools, it’s possible to measure service uptime and outages, which is the percentage of time a system is available and operational.
First-Contact Resolution Rate: This metric is the percentage of issues resolved during the client’s first interaction and can provide insights into customer satisfaction and agent effectiveness.
SLA Breach Rate: This rate indicates the percentage of tickets that have breached an SLA. A higher SLA breach rate can indicate a staffing shortage or a need for better training.
Number of Tickets Resolved: It’s also a good idea to keep track of how many tickets are resolved over a period of time. This will give you an idea of how your team is performing.
Incident Escalation Rate: By measuring the frequency at which incidents need to be escalated to higher support tiers or teams due to complexity or severity, you can determine areas for improvement.

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