SLAs — or "service level agreements" — are
agreements between a service provider and a customer that provide
objective standards of performance for the specific services. SLAs
are widely used in virtually all procurement arrangements, from
business process services, hosted software platforms, and the
provision of goods.
Depending on the services or commodities to be provided, SLAs
can be based on objective metrics (e.g., error rates, response
times, uptime) or subjective factors (e.g., customer satisfaction
derived from user surveys). SLAs can benefit both providers and
customers by tying contract terms to concrete performance standards
and avoiding a total termination of the contract due to a fixable
problem.
