Given today`s rapidly changing environment, service level agreements (SLAs) between customers and third parties can often yield erroneous results. In some cases, the metrics used to determine whether the service provider is executing immediately have become irrelevant. In other cases, the obstacles outlined in the agreements are unrealistic and serve only to establish a conflicting relationship between the parties. It`s time to rethink your SLAs. The first phase, lasting 3 months, involved implementing the CA Business Service Insight (formerly Oblicore) solution, setting up quality of service (SLA) levels, and then putting the solution into production for three countries, on the existing service agreement model. Instead of using standard ALS metrics as the primary test to see if service providers are doing their job, I think service buyers need to encourage their businesses to «create a business anticipation model.» The business anticipation model allows the company to set goals that adapt IT delivery models to business outcomes. For example, a critical service may need 24/7 coverage – 100% availability 100% of the time. But a service that is not critical may not require 99.9 percent availability. Why ask ALS and pay for it more, when these funds can be used to move the business forward? This type of decision-making allows IT to focus on getting «best-in-class» solutions, which can be excessive in terms of power and fire cost. In addition, ALS often hinders innovation. Although the service provider complies with ALS standards, there is little incentive for both parties to make changes or improvements.

For example, will the company be inclined to invest in technologies that will make it easier for the supplier to comply with the company`s ALS standards? At the end of 2010, BNP Paribas embarked on a project to set up a service contract management tool (SLM) for its production activities, in the field of technical leasing-sales engineering (Leasing Solutions). Static SLAs do not work in an environment where companies like TransAlta are looking for continuous improvement.


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