Marketing Glossary
← Back to glossary

Service Level Agreement (SLA)

What is a Service Level Agreement (SLA)?

A Service Level Agreement (SLA) is a contract between a service provider and a customer that specifies the level of service expected from the service provider. It typically includes details such as the services provided, the expected response times, the availability of the service, and the penalties for not meeting the agreed-upon service levels.

Why is an SLA important?

An SLA is important because it sets expectations and defines the level of service a customer can expect from a provider. It helps ensure that both the provider and the customer have a clear understanding of the services being offered, the responsibilities of each party, and the standards for performance and availability. SLAs also provide a basis for measuring service quality and holding the provider accountable in case of service disruptions or failures. Overall, an SLA helps ensure that the customer receives the agreed upon level of service and helps maintain a positive relationship between the customer and the provider.

How can I use an SLA?

You can use an SLA in the following ways:

  1. Define Service Expectations: An SLA clearly outlines the service levels and expectations for both you and the service provider, so you can ensure that you are receiving the level of service you require.
  2. Measure Performance: The SLA specifies key metrics for measuring the performance of the service provider, allowing you to monitor their performance and ensure that they are meeting the agreed-upon standards.
  3. Manage Vendor Relationships: An SLA can help establish a professional relationship between you and your service provider, and provide a clear understanding of the responsibilities of each party.
  4. Resolve Disputes: An SLA provides a clear reference point for resolving disputes that may arise between you and the service provider, as it outlines the terms and conditions of the service agreement.
  5. Ensure Business Continuity: An SLA can help ensure that critical services remain available and meet the required standards, even in the event of disruptions or outages, which can minimize the impact on your business operations.
  6. Negotiate Better Contracts: An SLA can provide leverage when negotiating contracts with service providers, as it lays out specific service expectations and holds them accountable for performance.

Related Terms

Terms & Conditions

Customer Advocacy

Voice of the customer (VOC)

Customer Satisfaction Score (CSAT)