SLAs & XLAs, combining the two

The Challenge

CIOs and IT Service Management Leaders face the on-going challenge of how best to measure service performance and customer satisfaction. Service Level Agreements (SLAs) are in place to manage and measure performance but often don’t capture what the customer really thinks. Recently, XLAs (Experience Level Agreements) have become a focus for IT Leaders with the view of truly understanding customer and user needs. This article will discuss the two and how they can work together.

SLAs are by nature contractual commitments. They are IT Service Delivery based, and focus on operations, completing key activities, delivering processes, and governance mechanisms. They are usually measured quantitively and revolve around areas such as Call Handling & Escalation Time, Availability & Uptime, and other measures of this nature.

The shortcoming of SLAs, is that they often aren’t designed with ascertaining customer satisfaction, and prioritising customer experience as the main driver. By focusing on completion of activities and not on outcomes, the customer element is often not fully factored in. From a back office `IT` perspective, Availability & Uptime are key performance measures but mean nothing to the customer and user of the service. Customer and user satisfaction needs to factor into experience related metrics, to ascertain if the service is being delivered to the expected standard, so that any gaps can be closed. ?

By not factoring in experience related measures, the Traffic Light Effect can come into play. Operationally, and as per SLA measures, a service report may come out as Green, and that all is well, but it should be amber or red as your users and customers aren’t satisfied with the service. A courier can deliver a parcel to the right house, within an agreed timeslot, which will come out as Green, but if the parcel is damaged or the wrong item has been delivered, then the service is actually Red because of the customer experience.

Enter XLAs

Many of you who are reading this will have come across the term XLA but may need advice on how to incorporate XLAs into your current agreements. XLAs are an extension of SLAs and focus on measuring key elements of customer and user satisfaction, such as ensuring that benefits are being delivered, and to what degree the service being provided is enabling the end user to achieve what is important to them.

SLAs & XLAs

An example of SLAs & XLAs working together, is when a service hits high availability levels, but the times when the service is down negatively impacts the ability of the user to do their job. A warehouse system may have high availability statistics during the day, but if the system is constantly down outside standard working hours, then this has a negative impact on the productivity of key personnel, and indeed the business overall. XLAs are designed to focus on this element of the service being provided, so that IT Service Delivery `supply` is meeting customer and user `demand`.

Whereas SLAs, especially with third party service providers tend to focus on some form of penalty, often financial, for the service provider, if an SLA isn’t met, XLAs factor in incentives for delivering the required outcomes and value. If you operate in a heavily outsourced environment, it is worth discussing an outcomes-based agreement with your service provider and if/how/when this can be achieved. This is a key step in ensuring that the Traffic Light Effect is no longer an issue and becomes a thing of the past. If your IT department is internal, then this provides a perfect opportunity to focus on creating Service Value Streams and taking the concept of XLAs forward to complement your SLAs.

SLAs and XLAs aren’t mutually exclusive, and together can ensure operationally efficient, customer orientated Service Delivery.

If you would like to discuss how to develop your approach to Service Level Management and Experience Level Agreements, please don’t hesitate to get in contact.