Service-level agreements (SLAs) are an important component of business consulting. They are often used by a company to communicate with its customers. It defines what each party needs to reach its goals and provides a mechanism for reporting on those goals and any issues that arise.
SLAs protect both the end user and the service provider by establishing standards, targets and consequences for meeting or not meeting those expectations. They allow the creation of key indicators that can assist a business in identifying areas that aren’t on track to achieve its strategic goals.
The SLA should include all services included in the contract, including details on turnaround time and any exclusions. A list of metrics that will be used to measure the service provider’s performance should also be specified in the contract.
Metrics that are easy to collect should be chosen to reflect factors that are under the reasonable control of the service provider. They should be set at a reasonable baseline so that they can be improved over time.
KPIs measure how a business performs in relation to the primary goals. It can help determine whether the business is veering away from its course, a common problem with small businesses.