What Are Service Level Objectives?
Learn what service level objectives are, how they work, and why they matter.
What Are Service Level Objectives?
Service Level Objectives Definition
Service level objectives (SLOs) are the agreed-upon performance targets for an activity, a process, a function, or another service over a specific period and are expressed as a percentage over time. Organizations can use service level indicators (SLIs) to track their service’s performance and reliability and measure compliance with their SLOs.
Organizations must meet SLOs to comply with service level agreements (SLAs). Some examples of SLOs are service metrics (e.g., application performance), technical metrics (e.g., CPU and running cost), and business metrics (e.g., uptime and availability).
Essentially, SLOs represent a service’s performance or health. Paying close attention to SLOs allows organizations to proactively monitor and improve their systems and provide customers with the best possible experience.
What Are SLAs?
SLAs, short for service level agreements, guarantee a certain level of service. Vendors and their customers will sign a contract laying out their SLAs and often includes financial repercussions, termination rights, and other penalties if the service provider fails to meet the agreed-upon service levels. Most SLAs consist of many individual SLOs. By clearly outlining expectations and consequences, SLAs can ensure that service providers and their customers are on the same page, which can help build trust and accountability.
What Are SLIs?
Service level indicators (SLIs) are quantitative metrics and measurements, key to measuring whether an organization is meeting its SLOs. SLIs are usually measured in percentages, rates, or averages and indicate whether or not a vendor is meeting the conditions laid out in the SLA. They can help organizations identify trends, maintain reliability, and make informed decisions more easily, increasing customer satisfaction and operational efficiency.
For example, if a company’s SLO for availability is 98.9% and the SLI measures 99.3%, it is exceeding its target for availability and meeting its SLO and SLA. On the other hand, if the SLI drops below the SLO threshold, such as 96.9%, the company needs to take action immediately to improve service performance and meet the required standards outlined in the SLO and SLA. Other common SLI examples include error rates, request latency rates, batch throughput, and resource utilization.
How Service Level Objectives Work
Organizations use SLOs to deliver increasingly reliable service to their customers. Luckily, there’s no need to collect all the data manually. These days, observability tools can do a lot of the heavy lifting, automatically collecting and analyzing various metrics, such as response times, uptime, error rates, and resource utilization.
Teams can compare the collected data against their established SLOs to determine whether their service meets customer expectations. Many observability solutions allow users to set alerts if performance falls below a certain threshold. As a result, they can take corrective action before issues escalate and violate SLAs.
It’s worth noting that people often measure reliability and responsibility in nines on the way to 100%. So, 90% is one nine, 9.99% is two, 99.9% is three, 99.99% is four, and 99.999% is five. Each decimal point closer to 100 increases reliability but comes with higher costs. Achieving higher levels of service availability or performance—such as moving from 99% uptime to 99.9%—requires more resources, infrastructure investment, and sophisticated monitoring and maintenance systems. Eventually, the additional investment yields diminishing returns, as most customers won’t be able to tell the difference between 99.99% uptime and 99.999% uptime.
Why Are SLOs Important?
SLOs are important because they help ensure service reliability, resulting in happier users, a better reputation, and a more successful business. More specifically, SLOs can help organizations:
- Reduce or avoid downtime: Downtime can significantly impact companies. It disrupts operations, causes financial losses, and results in unsatisfied customers, leading to diminished trust, lost business, and reputational damage. By setting clear SLOs and proactively monitoring service performance, organizations can detect issues before they cause significant outages, ensuring that services remain available and reliable for customers.
- Improve software quality and the user experience: By defining and measuring clear SLOs, organizations can identify key performance indicators (KPIs) that directly impact the quality of their software and the overall user experience. This helps teams stay focused on delivering consistent performance and addressing issues affecting user satisfaction while simultaneously striking a good balance between innovating for the future and providing stable, reliable service in the present.
- Adopt predictive incident management: Organizations often simply react to incidents. They wait for something to happen and then take action. However, this reactive approach to incident management leads to higher mean repair time, increased system downtime, and unhappy customers. By establishing thoughtful SLOs, organizations can improve observability and engage in proactive incident management to step in and address potential incidents before they escalate. This leads to reduced downtime and a smoother, more reliable customer experience.
- Promote automation: Well-defined SLOs can provide a clear framework for monitoring and measuring service performance throughout the software delivery cycle. Once you have determined your SLOs, you can easily automate monitoring and set alerts when KPIs pass a certain threshold. Some solutions may even act automatically, such as reallocating resources according to workload demand, to improve performance and avoid violating SLAs.
- Increase employee satisfaction: SLOs establish clear, measurable goals that guide employees on where to focus their energy and attention. By helping teams prioritize their work effectively, SLOs streamline workflows and improve efficiency. Plus, SLOs empower predictive incident management and automation, reducing the frequency of high-stress, urgent situations. Together, these benefits enhance employee satisfaction and boost productivity, making SLOs a valuable tool for fostering a more balanced and efficient workplace.
Implementing Service Level Objectives
Be realistic when implementing and setting SLOs. This means choosing SLOs that are attainable, measurable, understandable, and repeatable. They should also be affordable, controllable, and meaningful.
Being overly ambitious, such as opting for a 100% uptime goal, could be time-consuming and expensive—and it may even be impossible, leading to penalties and disappointed customers. At the same time, don’t intentionally set low SLO targets. While this may help you avoid violations, it won’t drive meaningful improvements or allow you to give your customers the experience they deserve.
Make sure to prioritize metrics. Instead of measuring all metrics and focusing on everything at once, identify the most critical metrics that align with your organization’s goals, SLAs, and customer expectations. Concentrating on performance metrics that directly impact your bottom line or customer happiness can help you allocate your resources more efficiently and take effective action to improve customer experience.
It’s also important to involve many stakeholders when determining SLOs and, by extension, SLAs. Not only should you talk to DevOps teams and product managers, but you should also consult with problem management departments and infrastructure engineers—and don’t forget your customers. Consider looking at social media, reading customer reviews, completing studies, or having focus groups to better understand customers’ needs. By listening to your customers and incorporating feedback from all relevant teams, you can create well-rounded, realistic, and impactful SLOs.
You should monitor your KPIs closely and use alerting mechanisms to detect SLO breaches early. This will allow your team to track compliance in real time, take proactive measures, and address issues before they impact your end users. Pay close attention when setting alert thresholds, as being too sensitive can result in alert fatigue and overwhelm your team with unnecessary notifications. Conversely, setting thresholds too high might delay critical responses and allow issues to escalate before they are addressed.
Additionally, automating SLO evaluation is crucial. Manual metric collection is time-consuming, error-prone, and slow, significantly impacting remediation and root cause analysis. By automating SLO evaluation, you can collect relevant SLIs, evaluate SLOs, and implement alerting systems that notify you before an SLO is violated. These systems should provide all the necessary context and dependencies, enabling your team to address issues before they become significant problems.
Finally, don’t treat SLOs as a one-and-done thing. Your system might change, or your customers’ expectations may shift, so you’ll need to regularly reevaluate your SLOs to ensure they remain relevant and effective. Establish a regular and in-depth review process to help you assess whether your current SLOs align with your business goals, customer expectations, and system performance.
Historical data, performance trends, customer feedback, and even recent technological or industry-standard changes can provide valuable insights as you reassess and refine your SLOs. If you notice that you are regularly meeting and exceeding a current SLO, you might consider raising the target to encourage further improvement or diverting resources toward a more pressing matter. On the other hand, if you are regularly missing an SLO, you might take a closer look at your metrics, pinpoint the root cause, and make adjustments as needed.
What Are Error Budgets?
Error budgets are the failure or technical debt allowed within an SLO before breaking the contract. For example, if your SLO guarantees that your website will have 99.9% uptime over one year, your error budget would allow up to 0.1% downtime or failures.
A larger error budget (for example, promising 97% uptime over a year and having a 3% error budget) gives more flexibility without immediately violating the SLO. Essentially, the smaller the error budget, the more emphasis is placed on maintaining reliability and minimizing failures. On the other hand, the larger the error budget, the more room for error and, by extension, experimentation, feature releases, or other high-risk activities.
There is no perfect error budget. It all comes down to your organization's specific needs and how the trade-offs between reliability and innovation will impact your business and your customers. The ideal error budget balances the need for stable, reliable service with the ability to innovate and improve without worrying about breaching the SLO. It should reflect your customers’ expectations while allowing you to innovate, update, and experiment without compromising system performance or customer satisfaction.
Regularly reviewing and adjusting your error budget ensures that it continues to align with evolving business goals, customer needs, and operational realities. You’ll be able to respond to changes in the market, shifts in customer expectations, or improvements in system reliability and have a solid framework for managing trade-offs between short-term risk and long-term goals.
What Are Service Level Objectives?
Service Level Objectives Definition
Service level objectives (SLOs) are the agreed-upon performance targets for an activity, a process, a function, or another service over a specific period and are expressed as a percentage over time. Organizations can use service level indicators (SLIs) to track their service’s performance and reliability and measure compliance with their SLOs.
Organizations must meet SLOs to comply with service level agreements (SLAs). Some examples of SLOs are service metrics (e.g., application performance), technical metrics (e.g., CPU and running cost), and business metrics (e.g., uptime and availability).
Essentially, SLOs represent a service’s performance or health. Paying close attention to SLOs allows organizations to proactively monitor and improve their systems and provide customers with the best possible experience.
What Are SLAs?
SLAs, short for service level agreements, guarantee a certain level of service. Vendors and their customers will sign a contract laying out their SLAs and often includes financial repercussions, termination rights, and other penalties if the service provider fails to meet the agreed-upon service levels. Most SLAs consist of many individual SLOs. By clearly outlining expectations and consequences, SLAs can ensure that service providers and their customers are on the same page, which can help build trust and accountability.
What Are SLIs?
Service level indicators (SLIs) are quantitative metrics and measurements, key to measuring whether an organization is meeting its SLOs. SLIs are usually measured in percentages, rates, or averages and indicate whether or not a vendor is meeting the conditions laid out in the SLA. They can help organizations identify trends, maintain reliability, and make informed decisions more easily, increasing customer satisfaction and operational efficiency.
For example, if a company’s SLO for availability is 98.9% and the SLI measures 99.3%, it is exceeding its target for availability and meeting its SLO and SLA. On the other hand, if the SLI drops below the SLO threshold, such as 96.9%, the company needs to take action immediately to improve service performance and meet the required standards outlined in the SLO and SLA. Other common SLI examples include error rates, request latency rates, batch throughput, and resource utilization.
How Service Level Objectives Work
Organizations use SLOs to deliver increasingly reliable service to their customers. Luckily, there’s no need to collect all the data manually. These days, observability tools can do a lot of the heavy lifting, automatically collecting and analyzing various metrics, such as response times, uptime, error rates, and resource utilization.
Teams can compare the collected data against their established SLOs to determine whether their service meets customer expectations. Many observability solutions allow users to set alerts if performance falls below a certain threshold. As a result, they can take corrective action before issues escalate and violate SLAs.
It’s worth noting that people often measure reliability and responsibility in nines on the way to 100%. So, 90% is one nine, 9.99% is two, 99.9% is three, 99.99% is four, and 99.999% is five. Each decimal point closer to 100 increases reliability but comes with higher costs. Achieving higher levels of service availability or performance—such as moving from 99% uptime to 99.9%—requires more resources, infrastructure investment, and sophisticated monitoring and maintenance systems. Eventually, the additional investment yields diminishing returns, as most customers won’t be able to tell the difference between 99.99% uptime and 99.999% uptime.
Why Are SLOs Important?
SLOs are important because they help ensure service reliability, resulting in happier users, a better reputation, and a more successful business. More specifically, SLOs can help organizations:
- Reduce or avoid downtime: Downtime can significantly impact companies. It disrupts operations, causes financial losses, and results in unsatisfied customers, leading to diminished trust, lost business, and reputational damage. By setting clear SLOs and proactively monitoring service performance, organizations can detect issues before they cause significant outages, ensuring that services remain available and reliable for customers.
- Improve software quality and the user experience: By defining and measuring clear SLOs, organizations can identify key performance indicators (KPIs) that directly impact the quality of their software and the overall user experience. This helps teams stay focused on delivering consistent performance and addressing issues affecting user satisfaction while simultaneously striking a good balance between innovating for the future and providing stable, reliable service in the present.
- Adopt predictive incident management: Organizations often simply react to incidents. They wait for something to happen and then take action. However, this reactive approach to incident management leads to higher mean repair time, increased system downtime, and unhappy customers. By establishing thoughtful SLOs, organizations can improve observability and engage in proactive incident management to step in and address potential incidents before they escalate. This leads to reduced downtime and a smoother, more reliable customer experience.
- Promote automation: Well-defined SLOs can provide a clear framework for monitoring and measuring service performance throughout the software delivery cycle. Once you have determined your SLOs, you can easily automate monitoring and set alerts when KPIs pass a certain threshold. Some solutions may even act automatically, such as reallocating resources according to workload demand, to improve performance and avoid violating SLAs.
- Increase employee satisfaction: SLOs establish clear, measurable goals that guide employees on where to focus their energy and attention. By helping teams prioritize their work effectively, SLOs streamline workflows and improve efficiency. Plus, SLOs empower predictive incident management and automation, reducing the frequency of high-stress, urgent situations. Together, these benefits enhance employee satisfaction and boost productivity, making SLOs a valuable tool for fostering a more balanced and efficient workplace.
Implementing Service Level Objectives
Be realistic when implementing and setting SLOs. This means choosing SLOs that are attainable, measurable, understandable, and repeatable. They should also be affordable, controllable, and meaningful.
Being overly ambitious, such as opting for a 100% uptime goal, could be time-consuming and expensive—and it may even be impossible, leading to penalties and disappointed customers. At the same time, don’t intentionally set low SLO targets. While this may help you avoid violations, it won’t drive meaningful improvements or allow you to give your customers the experience they deserve.
Make sure to prioritize metrics. Instead of measuring all metrics and focusing on everything at once, identify the most critical metrics that align with your organization’s goals, SLAs, and customer expectations. Concentrating on performance metrics that directly impact your bottom line or customer happiness can help you allocate your resources more efficiently and take effective action to improve customer experience.
It’s also important to involve many stakeholders when determining SLOs and, by extension, SLAs. Not only should you talk to DevOps teams and product managers, but you should also consult with problem management departments and infrastructure engineers—and don’t forget your customers. Consider looking at social media, reading customer reviews, completing studies, or having focus groups to better understand customers’ needs. By listening to your customers and incorporating feedback from all relevant teams, you can create well-rounded, realistic, and impactful SLOs.
You should monitor your KPIs closely and use alerting mechanisms to detect SLO breaches early. This will allow your team to track compliance in real time, take proactive measures, and address issues before they impact your end users. Pay close attention when setting alert thresholds, as being too sensitive can result in alert fatigue and overwhelm your team with unnecessary notifications. Conversely, setting thresholds too high might delay critical responses and allow issues to escalate before they are addressed.
Additionally, automating SLO evaluation is crucial. Manual metric collection is time-consuming, error-prone, and slow, significantly impacting remediation and root cause analysis. By automating SLO evaluation, you can collect relevant SLIs, evaluate SLOs, and implement alerting systems that notify you before an SLO is violated. These systems should provide all the necessary context and dependencies, enabling your team to address issues before they become significant problems.
Finally, don’t treat SLOs as a one-and-done thing. Your system might change, or your customers’ expectations may shift, so you’ll need to regularly reevaluate your SLOs to ensure they remain relevant and effective. Establish a regular and in-depth review process to help you assess whether your current SLOs align with your business goals, customer expectations, and system performance.
Historical data, performance trends, customer feedback, and even recent technological or industry-standard changes can provide valuable insights as you reassess and refine your SLOs. If you notice that you are regularly meeting and exceeding a current SLO, you might consider raising the target to encourage further improvement or diverting resources toward a more pressing matter. On the other hand, if you are regularly missing an SLO, you might take a closer look at your metrics, pinpoint the root cause, and make adjustments as needed.
What Are Error Budgets?
Error budgets are the failure or technical debt allowed within an SLO before breaking the contract. For example, if your SLO guarantees that your website will have 99.9% uptime over one year, your error budget would allow up to 0.1% downtime or failures.
A larger error budget (for example, promising 97% uptime over a year and having a 3% error budget) gives more flexibility without immediately violating the SLO. Essentially, the smaller the error budget, the more emphasis is placed on maintaining reliability and minimizing failures. On the other hand, the larger the error budget, the more room for error and, by extension, experimentation, feature releases, or other high-risk activities.
There is no perfect error budget. It all comes down to your organization's specific needs and how the trade-offs between reliability and innovation will impact your business and your customers. The ideal error budget balances the need for stable, reliable service with the ability to innovate and improve without worrying about breaching the SLO. It should reflect your customers’ expectations while allowing you to innovate, update, and experiment without compromising system performance or customer satisfaction.
Regularly reviewing and adjusting your error budget ensures that it continues to align with evolving business goals, customer needs, and operational realities. You’ll be able to respond to changes in the market, shifts in customer expectations, or improvements in system reliability and have a solid framework for managing trade-offs between short-term risk and long-term goals.
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