Service Level Agreements (SLAs) set a standard and signify a commitment from your business to uphold a specific level of service to your customers.
There are certainly challenges to overcome when it comes to implementing SLAs effectively in your business. First and foremost, deciding how best to approach them will need to be part of the discussions with your customer before you start delivering your services.
However, before we focus on just what SLAs you should offer them, it’s important we all understand what an SLA is and why they’re important to your business. So, let’s dive in:
- What is an SLA?
- Why are SLAs important?
- What challenges are there with SLAs?
- What SLAs should I offer?
1. What is an SLA?
It’s right there in the name: they’re agreements that exist between a service provider (that’s you) and a customer (the business you have a service contract with), where the provider agrees to meet a certain level of service and/or standard in their work.
These agreements are usually (but not always) a part of your contract with the customer. We say “not always” because some companies appreciate the flexibility to adjust an SLA without the hassle of rewriting an entire contract. In this way, SLAs and contracts differ. Ultimately though, an SLA helps to clarify and further define the expectations of your services.
In addition to the expectations, an SLA will often stipulate that a penalty will apply if the specifications aren’t met. Think of these as deterrents from failing to meet the promised standard. These could be financial penalties, or even disciplinary actions if breaches become frequent.
For most field service companies, SLAs tend to focus on time constraints. For example, that “an engineer will arrive within X hours for an emergency appointment”, or that “a job, once started, will be completed within X hours”. Timing is also precisely why the flexibility to amend an SLA is a good thing: you or your customer may wish to adjust SLAs as your relationship and experience of the service develops over time, allowing you both to refine and alter expectations accordingly, without interfering with your core contract.
2. Why are SLAs important?
It’s possible that you’ve experienced customers requesting SLAs (perhaps during tender reviews or through general business enquiries), but perhaps you found yourself unable to commit and, as a result, had to decline the work due to the constraints and potential risk.
That’s not something to feel bad about: SLAs aren’t appropriate for every business to implement - particularly if your business is still growing - and you certainly shouldn’t be putting yourself in a position where penalties may interfere with growth, all because you overplayed your hand...
That said, when they’re appropriate to implement, it becomes obvious why SLAs are important:
They set a standard
Having an SLA as an additional part to a contract means both parties agree there is a standard of what “quality service” means to them; it helps align your goals with your customers. For example, some customers will expect 24/7 availability when they sign a contract, while others will only expect you to pick up the phone during office hours. If you both know what you can provide, your service and their experience will benefit.
They establish goals
Motivating staff isn’t always easy, but if your engineers know there are goals that they must achieve, it’s a great way to give them something clear to aim for. We certainly wouldn’t recommend focusing on the penalties incurred if SLAs aren’t met; while fear can be a good motivator, SLAs should be treated positively, emphasising the expectation, but also the quality of service, and pride in creating happy customers through great work.
They limit disruption
You may have an SLA that agrees the downtime of an asset won’t exceed 12 hours; obviously any time lost will negatively impact your customers and your business, whether it means incurring unpaid hours of additional work, or loss in business for them. As such, setting a standard gives customers confidence a problem (if it occurs) will be resolved quickly and, again, gives you a goal to shoot for.
Delivering consistently on your SLAs is also great fuel to stoke the fire of your business; it means that the more you deliver (and especially if you have the evidence to prove it), you’ll have a stronger case to appeal to new customers and win new business.
SLAs become an indication of your staff’s commitment, making things easier in office, but also improving the capability of your business to meet and deliver in your promises to your customers. What could be better?
3. Challenges of SLAs
As mentioned, SLAs are usually based around specific time frames, so you’ll find that one of the biggest challenges you’ll face is keeping on top of managing them.
After all, depending on your business, the appointments you deal with can happen at all sorts of times in the day. Not to mention specified deadlines, multiple engineers responding to different appointments, and (especially in emergencies) lots of stress. With all that together, it’s not surprising how easy it can be to misjudge the timekeeping, or let tracking fall by the wayside.
Additional challenges can include:
- Tracking and recording SLAs
- Handling the amount of data
- Creating breach protocols
To help with some of these problems, you’ll want to stick around ‘til the end of the article to uncover the useful tool we’ve put together: a spreadsheet to help you keep track of SLAs.
In addition, particularly when it comes to maintaining a customer's assets, you need to make sure they experience as little downtime as possible. This means planning ahead and managing expectations by focusing on your clients needs and what you can deliver.
To help in this, you may have a Planned Preventive Maintenance strategy, or make use of Mass Scheduling along with Service Reminders to organise your engineer’s appointments, but whatever methods you use, you need to make sure you’re approaching the SLAs sensibly. With this done, you’ll be better placed to realistically meet targets for scheduling engineers, fixing issues, and keeping customers up to date.
For example, if you don’t offer 24/7 availability, you can’t state that you’ll manage any problem in 2 hours, regardless of the time of day. Ultimately, don’t make promises (especially contracted ones) that you can’t keep.
4. What SLAs should you offer?
Now that you know what an SLA is, perhaps you’re confident that your business is now big enough to commit to approaching customers to implement them.
So, just what SLAs should you offer? The answer to this question is all about making sure you adopt the right approach. Unfortunately, when thinking about SLAs, there isn’t a one-size-fits-all approach.
Indeed: each customer will have unique needs, so your focus needs to start there and work with them to understand what they need and how your service can fulfil that need for them. Consider questions they may ask, such as:
- How much time it will take to get an appointment?
- How much time it will take for an engineer to arrive?
- How much time it will take to that engineer to fix ‘typical’ issue?
- When it comes to emergencies, what response time is required?
To help a little more, note that there are several standard SLAs to look out for:
- Time to schedule a job - This is the time from a job record being created and it being scheduled into an engineer’s diary.
- Time for engineer on site - This is the time it takes from the job record being created and the engineer arriving on site.
- Time for completion - This is the time time it takes from the job being added and it being marked as completed.
Like we said, don’t make promises you can’t keep, but if you make an effort to understand what your business is capable of and ensure you’re in a strong position to demonstrate that with confidence, you’re likely to work out SLAs that will suit both you and your customer.
Now that you know how best to approach establishing SLAs, you can begin to put together a plan to implement them within your business. Whether the time is right now, or perhaps a little later down the line, it’s important to keep in mind that there’s a lot to be gained from having them be a part of your business.
Granted, you might say there’s an element of risk with the potential penalties, but you wouldn’t be providing your services if you weren’t capable of achieving success and certainly, for both you and your customer, the benefits of delivering a quality service outweighs any uncertainty.
With this in mind, you’ll be better placed to benefit from the improved customer relationships, the chance to win bigger, better contracts, and the boost to your cash flow as well.
Remember, staying on top of your SLAs is the most important thing, so alongside doing great work to meet those targets, you need to implement a system (ideally with automation on hand) to keep track.
While job management software with SLA tracking is certainly the best way to go, you may wish to get started with another solution. To help you out, we’ve prepared a free spreadsheet that you can download to track and monitor your SLA performance, click below to get your SLA Monitoring Tool, today!