Point of View

Five questions to ask about SLAs as you move to the cloud

January 28, 2021

Migrating applications and services to the cloud creates many benefits intrinsically aligned with HFS’ concept of the journey toward the Digital OneOffice. As your organization becomes dependent on cloud-based technologies, astute leaders must pay close attention to the contracts and agreements they sign. Failing to do this can negatively impact business, customer, and supplier relationships.

An organization should carefully consider many aspects of the average contract, including remediation, assignment, termination, and intellectual property; however, clients often overlook how providers will deliver services in times of crisis. This is where the service level agreement (SLA) section in a contract plays a crucial part; do not overlook it.

In the context of the SLA, problems often boil down to a lack of pre-emptive auditing on how different technology towers need customized service and support. A lack of agreement within the organization between users and the IT department once services are in place could augment this problem. An organization can remedy much of this if technology leaders work with procurement and legal to set a base level of expectations to reflect in their contracts. Once they achieve this, both business and technology leaders can proactively work with vendors and service providers to harmonize SLAs with business needs.

Technology leadership, procurement, and legal teams should ask these five questions to set equal expectations across teams and providers and adapt their contracts appropriately

  1. Have you taken the time to align your internal SLAs with those of your providers?Augmenting, migrating, or outsourcing application support may create new workflows to remediate issues or requests. If current policies don’t align and reflect additional time your service provider may add, you may quickly find that you exceed your internal promises to stakeholders. This can create service and satisfaction issues, resulting in friction between the business and the technology team.
  2. Have you ensured your vendors align across dependent systems or applications? As your organization adopts the Digital OneOffice, you should do your best to align SLAs across providers and vendors to ensure resolutions and support tickets can follow similar cadence across criticality levels and remediation time. Lack of consistent support agreements across solutions or providers for level 1 (critical) or level 2 (important) escalations may result in your organization incurring liabilities for services it renders or has contracted to provide.
  3. Do you have a clear understanding of the SLA from your provider’s perspective? Often, an SLA focuses on uptime provided by the third party; however, as a business or technology leader, you may care more about the performance of the application or service the third party is providing. For example, in an SLA for backup or disaster recovery, a company should consider having recovery point objective (RPO) and recovery time objective (RTO) clearly documented in the agreement. An organization moving IT towers to a cloud-native model would need to have the same considerations, including service desk, service management, infrastructure management, and more.
  4. Do you have an escape clause in the SLA for ongoing poor performance or missed objectives? Without clear points in the contract, the SLA isn’t worth much. The SLA should prescribe regular reviews of clearly stated thresholds with the vendor. Sharing data on outages, escalations, and outstanding deliverables allows both parties to prioritize their efforts and collaborate rather than point fingers. In the case of ongoing issues, both parties will also have a shared understanding of how resolution looks and when it can be delivered, which may lead to clear actions by either party.
  5. Who calculates the SLA? There have been cases where the customer receives the SLA report from the provider, and it is written into the contract that only the provider’s SLA documentation is considered factual and accurate. Accepting this should be an obvious cause of concern for any astute leader. Instead, ensure the agreement captures your organization’s SLA metrics and that your quarterly business reviews discuss mutually generated reports and metrics. Most publicly traded vendors or service providers will resist negotiating their SLA. Given this, IT and business leaders should architect their agreements with this in mind or seek alternate hosting type vendors.

Documenting your needs can improve supplier relationships

SLAs can ensure all parties involved know what to expect, when to elevate a discussion, and how to minimize risks for all stakeholders. However, it is up to the technology buyer to do the work by aligning expectations with selection, procurement, and vendor review processes. Failing to do so will create friction and lead to satisfaction issues with stakeholders and contention between the services seller and buyer.

SLAs aligned to business and stakeholder requirements have a critical role in streamlining end-to-end process delivery. Optimizing processes across the back, middle, and front offices is the foundation for implementing the Digital OneOffice.

Becoming a cloud-native organization will require your organization to rethink its service and support commitments to its stakeholders. This may manifest in the contractual SLAs you agree to. Being proactive can resolve many issues before they even exist. The result can be a better relationship with your provider and will go far toward ensuring both parties can work together and achieve success.

The Bottom Line: Relationships matter to achieve a Digital OneOffice, and having clear SLAs will foster productive engagements with your service providers.

As companies adopt the Digital OneOffice and migrate more solutions to the cloud, they need to understand that SLAs are critical for developing good, trusted, and dependable relationships with their partners. Aligning contractual dependencies, including SLAs, can promote a seamless migration to the OneOffice.

Sign in to view or download this research.


Lost your password?


Insight. Inspiration. Impact.

Register now for immediate access of HFS' research, data and forward looking trends.

Get Started