A Service Level Agreement (SLA) is an agreement or contract between an organization and its service provider that details the obligations and expectations of the relationship. Working with a service provider has many benefits, but to get the most out of this relationship an SLA should be put in place. The SLA functions as a blueprint of the service the provider will provide, and can protect your organization's assets and reputation. Below we’ve provided 3 reasons why your organization should have an SLA with their provider.

1. Sets Clear and Measurable Guidelines

Your SLA is the key to making sure you and your service provider are on the same page in terms of standards and service. By creating a service level agreement, you and your provider can work together to better manage expectations, workloads, and more so establishing clear and measurable guidelines is important. 

2. Provides Recourse for Unmet Service Obligations

If your service provider fails to meet its obligations, there can be significant consequences for your organization's reputation and bottom line. Your SLA lays out a system of recourse if obligations aren’t met. The document should include consequences in the event that performance standards are not met. These may take the form of monetary penalties that can be used to assist your organization if losses are incurred. It also protects your organization and holds your provider accountable.

3. Provides Peace of Mind

An SLA can provide peace of mind to the client. Having a contract to which you can easily refer to allows for greater accountability in the client/provider relationship. Service providers may also refer to it to determine exactly what is expected of them. 


A Mutual understanding of the terms of your agreement with your service provider is an important element in the creation of a positive experience for all involved parties. Any service provider you choose should be more than happy to create an SLA with you. However, having an SLA isn’t enough. Always remember to review the contract as your business grows or changes. Your needs may change over time and your SLA should always reflect your organization's evolving needs.

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