SLAs are a point of disconnect

More than one IT leader has stated that they feel that SLAs are ‘pointless.

Enterprise technology customers are currently dissatisfied with service-level agreements (SLAs) that accompany telecoms services, according to GlobalData. The leading data and analytics company notes that current SLAs are rooted in old-fashioned telco thinking and do not match the increasingly dynamic needs of enterprises, however, the opportunity does exist to make them relevant using artificial intelligence (AI) and linking them more closely to business outcomes.

Gary Barton, Research Director at GlobalData, comments: “The reaction from many enterprises we have spoken to is that SLAs are an ineffective tool for guaranteeing service performance. More than one IT leader has stated that they feel that SLAs are ‘pointless. The feeling is that, as businesses are relying ever more heavily on their network and collaboration technology, the penalties for poor service performance are significantly lower than actual monetary losses suffered by businesses during service outages.”

GlobalData also found that SLAs are often poorly aligned with the enterprises’ business needs. While ‘outcome-based’ SLAs have often been talked about by service providers, progress has been slow. However, there are signs that providers are beginning to change their approach.

Barton continues: “Service providers are seeking ways to increase their managed services revenues and outcome-oriented SLAs offer an opportunity to connect their solutions to the customer’s core strategies. Establishing the key performance indicators (KPIs) for outcome-oriented SLAs is not easy, but the conversations required at the pre- and post-sales stages to agree on appropriate KPIs can generate deeper understanding on both sides. Service providers also need to be both bolder and more flexible.”

One of the factor’s driving changes is the rise of new technologies such as AI, machine learning, and automation. Training AI to make the right decisions and expose sufficient volumes of data takes time, but it is already establishing itself within SLAs.

Barton notes: “We have already seen propositions such Orange Business Services ‘Service Manage-Watch’ that includes SLAs for AI generated trouble tickets. The ultimate ambition is for AI to enable ‘self-healing’ networks that deliver the level of service performance consistency that enterprises crave.”



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