Contract and Supplier Management Guidance

Service Level Agreement

  • A negotiated agreement between a provider and the recipient, generally for a service provision.
  • Clarifies the services, expectations and responsibilities.
  • Defines required service elements:
    • Service availability
    • Standards
    • Duties
    • Complaints/escalation procedure
  • Defines management elements:
    • How performance will be measured and reported
    • Dispute resolution
    • Revision process

    Figure 1: Distinguish between KPIs and SLAs

    Drive behaviourDrive behaviour
    Drive continuous improvementAchieve performance targets
    Track success, view trendsTrigger articulated consequence
    • Financial credit or penalty
    • Accept/rejection
    • Termination
    Describe DESIRABLE outcomeDescribe GUARANTEED performance

    Outline Service Level Agreement Contents

    • Objective of the Agreement
    • Future reviews and amendments to this Service Level Agreement
    • Objectives of the Service
    • Service Users
    • Responsibilities - who we are, what we do
    • Service Availability
    • Description of key services
    • Service Levels/Standards (Describe how you will measure, monitor and evaluate service performance - quantitatively and qualitatively.)
    • Monitoring success (Report on performance - what will be your key performance indicators/outcomes or impacts)
    • Complaints (Describe how complaints or conflicts will be dealt with and resolved.)
    • Date of Agreement (insert date)
    • Signatories to Agreement

    Once an SLA is in place, it should be periodically reviewed to ensure the requirements continue to meet user needs.