Watch out for Service Level Agreements

By Patrick Kershaw, Horizon Pacific

It’s accepted that businesses need some support in running their IT systems, but should IT maintenance be reactive or proactive?

Reactive maintenance isn’t really maintenance at all. It is usually reserved for those with fewer than five machines who try to do things as cheaply as possible. When things break, they have to source someone to come and fix it. Any business with between five and 200 PCs running its IT infrastructure with reactive maintenance is a time bomb waiting for something serious to go wrong.

Proactive maintenance, on the other hand, can entail a raft of varying services, but essentially entails paying a fixed monthly fee to ensure basics don’t go awry with the network and ensures guaranteed escalation systems are in place if they do. It also identifies any precursors to major issues and can help in formulating a concise plan for disaster recovery – an excellent and necessary investment.

With a Service Level Agreement (SLA), it’s important to look at what is actually being provided. A lot of IT companies charge exorbitant fees for essentially providing nothing.

Many of you will be familiar with vague-sounding agreements and clauses such as ‘monthly patching’ and ‘active monitoring’. But what do these actually mean? What do you actually get?

The real reason most IT businesses want this monthly payment is so they can lock more consistency into their income stream; they’re ‘Break-Fix’ businesses – IT businesses built by literally fixing PCs for a living. They rely on the client’s systems to break so they’ll get paid, whereas the actual business requirement is for systems NOT to break. This is not a mutually beneficial business relationship.

To get consistent income, IT businesses need to lock their clients into an SLA. These usually use smart rhetoric and jargon, leaving clients mind-boggled and thinking they need whatever’s being offered. The reality is that clients are often not provided much bang for their buck.

Before taking on a support agreement from an industry-standard IT provider, consider the following factors and ensure they are being provided:

• Clearly defined tiers of SLA and what they entail.
• Transparency in terms of how much actual time is being spent completing the SLA each month and what is being done in this time. This can be objectively compared to other companies and should never be hidden.
• The ability to have all connectivity, SPAM, and networks monitored and reported on.
• Monthly meetings that cover a set agenda every time – which shouldn’t change – as well as performance evaluation on the SLA every month.
• Guaranteed response times to logged jobs as well as guaranteed rates. There should be pure transparency, so you both know when standards have and have not been met.
• The ability to log and view all jobs online.
• Access to all financial statements and invoices online. 
• Ability to receive remote support. 
• A clear online forum for giving feedback on performance.
• The industry standard IT supplier will definitely have a set of standards you must meet BEFORE they will take you aboard.
• You will be assigned an account manager – not a technician – as an adviser and primary contact.

Patrick Kershaw is a business partner with Horizon Pacific, a nationwide technology support provider specialising in assisting SMEs with their technology requirements. For further information, email patrick.kershaw@horizonpacific.com.

NZLawyer, Issue 97, 19 September 2008