The SLA: GET OUT OF JAIL FREE
How the Service Level Agreement is your best friend.
The Service Level Agreement, or SLA, has surprisingly bad reputation. Most teams despise writing them. Many teams are fearful of them. Some teams even think not having one is a value, saving them from having to meet unrealistic expectations. If you didn't commit to it, you can't be held accountable for not meeting it, right? If you believe any of these things and have therefore avoided or simply not gotten around to creating an SLA, you're missing out on a huge opportunity… and actually allowing yourself to be held to unrealistic expectations.
All of these perspectives are the result of a significant misunderstanding of the purpose of an SLA and what it's value can be to your team. Yes, it is a clearly defined articulation of the services you're providing and yes, it establishes the commitments you're making to the organization and can therefore held accountable for meeting. However, it is also a clear outline of the services you will not be providing. It defines not only the scope, but also the limits of the service(s) you are offering to the organization.
A well-done SLA is the most powerful negotiation tool you have as an internal service provider, and it's all about funding.
Sure, it's called a "Service Level" agreement, and that name isn't technically incorrect… but it is perhaps incomplete. I believe a more accurate term might be a Service Funding Level Agreement. The SLA describes not only the services your team is providing, but more specifically it describes the services your team is being funded to provide. This also means it is an opportunity to clearly define what services your team is not being funded to provide, and this is your Get Out of Jail Free card.
By not clearly setting expectations you are allowing yourself to be held accountable to any expectation. By describing what you are and are not delivering, you are also setting… and limiting… the expectations that the organization can hold you accountable for. For the business that is funding you, this can be a very eye-opening experience. Suddenly all of the unrealistic expectations the organization had can be seen in plain view. This usually changes the entire conversation. The next sentence is usually something along the lines of "I would love to provide that for you, but that's impossible given my current budget/funding". And thus, the negotiation begins.
Funding or budget is the ultimate defining element of the services you can provide. Your people, your tools, your infrastructure, your platform, are all resources you need to deliver a specific service at a specific level, and they all cost money. The math is simple: If the business wants a specific service at a specific level, you have to be funded at that level or you can't offer that service. This is the true power of the SLA. It is a forcing function to either get you more funding or make clear the limits of your capabilities in absence of that funding.
If the business wants a certain availability level, you have to able to afford the infrastructure necessary to meet that request.
If the business wants a certain support level, you have to be able to pay the people required to meet that request.
If the business wants a certain… anything… you have to be able to pay for the resources necessary to meet that request.
…and if they won't, then you can't. Period. Please sign here to indicate that you are not funding and will therefore not be receiving those services. Please ensure your CxO receives a copy. It's been a pleasure working with you. Also, don’t be surprised if there is resistance to this concept. Remember that the goal of the business is to do as much as possible at the lowest cost possible (aka, make a profit). This should apply to your service level as well… but when squeezing compromises the service level expected, the answer is no.
The SLA should also be reviewed regularly… at least annually… to ensure those expectations can be met at the current funding level, to meet the growing scale of the business, or to meet new business needs. If your organization is evolving quickly then more frequent reviews would certainly be justified. The same is true for a critical business event such as an acquisition. If you feel the business context has changed, it’s time to review the SLA.
Service Level Agreements are annoying to write and can be difficult to negotiate, but it is a critical tool for setting expectations and for ensuring you can meet those expectations. Unset expectations are still expectations. Don’t let yourself be held accountable for meeting an expectation you didn’t agree to or get funded for.
Note: This is a rewrite of a similar post was previously published under the title “Why you REALLY need an SLA” on my MSDN blog, Mossy Business, since removed due to a migration by Microsoft to a new engineer blogging platform. The concepts are the same as that previous post.