Understanding the distinction between OLA vs SLA is important for establishing a solid framework in managed IT services. Both Operational Level Agreements (OLAs) and Service Level Agreements (SLAs) play vital roles in shaping how teams collaborate internally and how services are delivered to clients. Knowing these agreements not only improves workflows but also helps create transparency and trust with clients.
Curious to see how OLA and SLA can enhance your service delivery? Let’s explore their unique roles and benefits.
What is OLA?
An Operational Level Agreement (OLA) is an internal framework used by different departments within a company to coordinate service delivery. It specifies the roles, responsibilities and processes necessary to ensure teams collaborate efficiently. OLAs play a key role in supporting the commitments made in Service Level Agreements (SLAs) by structuring internal operations to meet those service obligations.
By setting clear expectations, OLAs reduce misunderstandings, enhance teamwork and streamline workflows, improving overall service quality and better alignment with customer requirements.
What is SLA?
A Service Level Agreement (SLA) is a formal contract between a service provider and a customer that specifies the standards for service performance, availability, and other measurable metrics. Critical elements of an SLA include response times, escalation procedures, and performance indicators, all of which ensure transparency and accountability.
Types of SLAs:
- Client SLAs: Define service expectations for external customers.
- Internal SLAs: Establish agreements between internal teams within an organisation to improve collaboration and ensure service levels are met internally.
- Multi-Level SLAs: Tailor service expectations across different customer segments or levels, such as corporate, departmental, or individual services.
OLA vs SLA
While both OLAs and SLAs are essential for service management, they serve different audiences and purposes. The table below highlights the key differences:
| Aspect | Operational Level Agreement (OLA) | Service Level Agreement (SLA) |
|---|---|---|
| Definition | Internal agreement outlining team roles and processes | External contract between service provider and customer |
| Purpose | Supports internal coordination and operational efficiency | Sets measurable service standards for clients |
| Parties Involved | Internal teams or departments | Service provider and customer |
| Focus | Internal workflows, responsibilities, and dependencies | Service performance, uptime, and response times |
| Negotiation | Internally managed, no client involvement | Often negotiated based on client requirements |
| Sections Covered | Internal processes, team roles, escalation paths | Service availability, performance metrics, escalation |
| Enforcement | Enforced internally by the organization | Enforced by the customer or service provider |
| Impact | Affects internal efficiency and team collaboration | Directly affects client satisfaction and service quality |
| Industry Usage | Primarily in IT, software, and managed services | Used across various industries with service provider-client relationships |
| Timeframe | Focuses on daily operational efficiency and quick resolution | Covers long-term service commitments and SLAs over time |
| Alignment with SLA | Designed to meet SLA commitments internally | Focused on meeting customer service expectations |
Right Way to Write an Effective OLA
OLA helps internal teams align and collaborate to fulfil the commitments made in SLA. Here’s how to write an effective OLA:
- Define a work scope: Clearly define the tasks and services required. Make sure both teams and departments understand the scope to avoid miscommunication and misalignment.
- Define roles and responsibilities of parties: Specify the roles of each individual, team, or department involved in service delivery. Clearly indicating responsibilities ensures accountability and avoids overlaps or confusion. This includes defining the tasks for internal parties such as customer service, technical support, or IT.
- Set expectations for response and resolution times: Establish timelines for responding to incidents and resolving issues. Ensure teams are aware of the urgency, and set achievable expectations for addressing service-related problems. For example, response times could vary based on the severity of the issue.
- Document procedures and workflows: Create detailed, step-by-step workflows for handling different tasks and incidents. Properly documented procedures help streamline processes and allow teams to follow a clear, organised path when dealing with requests or issues.
- Establish an escalation process: Define clear escalation paths when the assigned team cannot resolve issues. Outline criteria for when and how to escalate problems to higher-level management or support teams to ensure that no issue goes unresolved.
- Regularly review and update OLAs: OLAs need regular updates to stay relevant as internal teams and roles change over time. Consistent reviews ensure that the agreement reflects current team structures, responsibilities, and service requirements.
Right Way to Write an Effective SLA
To write a detailed and effective Service Level Agreement (SLA), consider the following steps:
- Define your service metrics: Clearly identify measurable metrics that gauge service performance, such as uptime, response times and resolution times. These KPIs will help track and assess the quality of the service being provided.
- Set realistic, measurable goals: Avoid overpromising by setting achievable goals based on your team’s capacity. Ensure the targets are specific, measurable, and aligned with both business capabilities and client expectations.
- Highlight escalation and resolution procedures: Detail the process for handling incidents, including how and when escalation occurs, response times for each issue type, and the communication methods that will be used to resolve problems. This will keep the client informed about how service disruptions will be addressed.
- Define service credits and penalties: Outline the consequences if service commitments aren’t met. This could include service credits or penalties to maintain accountability. It helps foster transparency and trust between the client and the provider.
- Establish regular reporting: Establish a regular reporting process to evaluate service performance and progress against the SLA. These reports should be delivered periodically (monthly, quarterly, etc.) and include insights on metrics, goals achieved, and areas for improvement.
- Do revisions: SLAs should be updated regularly to reflect changes in business needs, service scope, or client expectations. As the relationship evolves, periodic revisions ensure that the agreement remains relevant and useful, improving the partnership over time.
Matrix Solutions specialise in tailored managed IT services for the legal industry, providing robust, secure and scalable solutions that align with your business goals. As your dedicated managed service provider, we work closely with you to develop comprehensive OLAs and SLAs that not only meet but exceed your expectations.
For more information on how we can support your law firm with our expert managed IT services, please contact us today. Let’s discuss how we can help you achieve operational excellence and client satisfaction through effective IT management and support.
FAQs on OLA vs SLA
An SLA is customer-facing and highlights the service standards, while an OLA is internal and supports the SLA by defining internal workflows. Underpinning contracts (UC) involve third-party suppliers and describe the responsibilities of external parties in delivering the service.
An SLA defines service performance between a provider and a customer. In contrast, an LOA (Letter of Agreement) is less formal and typically used to outline the general terms of an agreement without the detailed commitments of an SLA.
Yes, an SLA is legally binding. It establishes the service provider’s accountability to the customer based on the agreed-upon terms.
In ITIL (Information Technology Infrastructure Library), an OLA defines the responsibilities of internal support groups within an organisation to ensure that customers’ SLAs are met.
An example of an OLA might be an agreement between the IT helpdesk and the network management team detailing how they will collaborate to meet the uptime requirements outlined in an SLA.
