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What are service level agreements?

Definition: Service Level Agreements (SLA) are contracts between a service provider and customers that outline the performance expectations and service levels the provider commits to deliver. 

SLAs are used in various industries, like IT and customer support, to ensure a clear understanding of the quality and scope of services provided.

Elements of a service level agreement

  1. Agreement overview: Brief introduction to the SLA
  2. Service level objectives: Performance targets that the service provider must meet.
  3. Scope of service: Identifies the specific services covered by the agreement, the customers or users who can access these services, and any geographical, time, or usage limitations.
  4. Service description: Detailed description of the services offered by the provider, including the service objectives, deliverables, and performance metrics.
  5. Limitations: Exclusions, restrictions, or exceptions to the SLA, like circumstances beyond the provider's control.
  6. Service management: Processes, roles, and responsibilities for managing the service delivery.
  7. Monitoring and reporting: Methods and frequency for monitoring performance and reporting the results to the customer. This ensures transparency and allows both parties to track progress and adjust as needed.
  8. Remedies and penalties: If the service provider fails to meet the agreed-upon performance targets, the SLA can specify remedies or penalties, such as service credits, discounts, or other compensations.
  9. Escalation procedures: SLAs often outline the process for escalating issues when the service provider is not meeting the agreed-upon performance targets. This can include escalation to higher levels of management or implementing corrective action plans.
  10.  SLA lifecycle: Outlines the process for creating, implementing, monitoring, reviewing, and updating the SLA. 
  11. Terms and conditions: The SLA will also include general terms and conditions, such as the contract duration, renewal terms, and any limitations or exclusions.
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Article FAQs

What is the purpose of a service level agreement?
The purpose of a Service Level Agreement is to define the performance expectations, scope, and terms of services provided to the customers. 

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