What Is An IT Service Level Agreement (SLA)? Why Is It Important?

When working with an external IT support provider, SLAs are an important tool for setting expectations. The SLA doesn’t just matter to the provider, it’s important to the customer as well. 

Often, business leaders who are looking for IT support either don’t pay attention to the details of their SLA or don’t have a full understanding of what the agreement entails. At Kelser, we provide managed IT support services for companies just like yours and we’ve seen this happen more often than we’d like. That’s why we are writing this article. 

In this article, I’ll explain what an SLA is, what it should include, what happens if a provider fails to adhere to the SLA, and why it even matters.

With this information, you’ll be better prepared to read and understand the terms of your SLA and make sure your expectations are in line with what your provider commits to in terms of response and resolution time. 

What Is An IT SLA?

An SLA is part of your agreement with your IT provider. It defines the provider’s commitment to respond to and resolve customer service tickets within an allotted amount of time.  

By signing the agreement you commit to accepting the terms of service. While all service providers aim to resolve customer issues as quickly and effectively as possible, the agreement spells out the specific service terms you can expect.

The SLA may also include different response and resolution timelines for different kinds of service. Pay attention to the details.

Related article: Everything You Need To Know About Service Tickets

What Is Response Time?

An SLA typically spells out the maximum amount of time a customer can expect to wait before hearing back from someone who can begin to resolve the issue.

While there may be other steps in the process (such as an email acknowledgement of the service request), the total response time isn’t calculated until a service engineer actually reaches out to the customer. 

(This definition can vary among providers, so make sure to understand how your provider defines it.) 

According to an internet search, the average response time for most IT providers is 30 minutes or less, which means you will speak directly with someone who can help within ½ hour of placing a request for service.  

While the SLA gives you an idea of what to expect, you can gain further understanding of an organization’s responsiveness by asking how often the expectations spelled out in the SLA are met as well as the organization’s average response time during a given period. 

How Is Average Response Time Calculated? 

Average Response Time = Total Response Time ÷ Total Number Of Service Tickets

What Is Resolution Time? 

Resolution time is calculated from the time the initial ticket is received until the issue is completely resolved. Many IT providers aim to resolve issues during their first phone call with a customer, but the industry average for maximum resolution time is within 5 hours.

As with response time, you can gain further understanding about a provider’s responsiveness by asking about how often it meets the maximum defined in its SLA and its average resolution time

How Is Average Resolution Time Calculated? 

Average resolution time = Total Resolution Time ÷ Total Number Of Service Tickets 

Read this article to find out how IT systems work to prioritize urgent requests. 

What Happens If Your Provider Fails To Meet The Service Terms Outlined In The SLA?

The SLA may include details about how the customer will be compensated if the provider fails to meet the timelines outlined in the SLA. This can vary from one provider to another, so ask questions and be sure to read the fine print. 

Why Are SLAs Important? 

When comparing IT service providers, it’s important to consider the terms of the SLA. If one provider offers a resolution time of 3 hours and another 5 hours, that difference could be critical to your business and may come with cost differentials.

Maybe your business can afford to wait 5 hours. Maybe that's a deal breaker for you and you are willing to pay a premium for faster service.

SLAs are one way to measure provider responsiveness. They also serve as a way to differentiate between providers. If a provider offers a 3-hour resolution maximum, but only achieve it 10 percent of the time, it may not be worth the extra cost. If a provider offers a 5-hour resolution maximum, but only achieves it 10 percent of the time, that's a red flag. 

It’s important to have all of the information you need to make the best decision for your business. SLAs spell out the response and resolution time expectation so there are no surprises. Read this article to find out more about SLAs and five factors that can affect resolution time. 

Related article: Why Does It Take So Long To Get IT Support? (5 Things Every IT Support Ticket Needs)

What’s The Bottom Line? 

After reading this article, you have a full understanding of the importance of SLAs. You know what they are, what information they include, how they help set expectations, and important questions to ask (such as the potential consequences if the provider fails to meet the terms outlined in the SLA). 

At this point, the best advice I can give you is to pay attention to SLAs when evaluating providers. Understand the level of service your business needs and what you can tolerate in terms of service, so you don’t end up paying for more than you need but have what you need when you need it.  

When evaluating providers, don’t be afraid to ask questions about the details of the SLA. This information will be critical to helping you make the right decision for your organization. 

Here are some other important questions to ask when evaluating IT providers. 

When evaluating external IT support providers, check out several options to find the best fit. At Kelser, we take this advice so seriously that we’ve even done some of the legwork for you. 

We know, as consumers ourselves, that the first place we look when shopping for an important product or service is the internet. So, we’ve put together some articles that compare our services to other IT providers based on publicly available information we found in a quick internet search. 

Check out this comparison of The Walker Group and Kelser, for example. Or this comparison of Whalley and Kelser. Visit our Learning Center for more comparison articles.

Still not sure whether managed IT is right for you? Read this article for an honest comparison of managed and break/fix IT solutions.