ASP Summit puts spotlight on SLAs
Though most ASPs deal at the mid-market level, they'll need to deal with service-level agreements (SLAs) at the Fortune 500 level
LAS VEGAS - Application service providers (ASPs) need to understand that service-level agreements should evolve over time, provide the utmost in consistency, and act as more than just contracts and torts.
So said Mary Nugent, BMC Software Inc.'s general manager of service provider solutions, in a keynote address last night at the ASP Summit of Comdex.
In a packed ballroom here, Nugent explained her concept of the "four metrics" of writing and enforcing an SLA: availability, performance, problem resolution and responsibility allocation.
"Even though you may be dealing with the mid-market, if ASPs are going to survive, you're going to have to deal with SLAs at the Fortune 500 level," Nugent said. "If you say "It's not really my fault, it's Exodus' fault or Qwest Cyber Solutions' fault,' the customer doesn't really want to hear that."
"This is pretty simple stuff, but it's amazing how misunderstood it can be," she continued. "You have to listen to your customer. We tend to use technical terms, things like bandwidth and dropped packets, that don't mean anything to the businessman sitting behind the table."
Nugent gave from-the-trenches advice on what to include in a good SLA. For example, she said there should be a problem-resolution timeframe, multiple severity levels, and scheduled times to evaluate and update the SLA. And ensuring uptime must be "more than a ping" - applications could be up, but frozen and still listening, she noted.
"When your environment changes, you've got to renegotiate ... you've got to decide the new rules of the game," she said. "Customers will then see it as a living, breathing document."
It's also a good idea for ASPs to include a service indicator on their Web site, so customers can see any problems in a self-service mode. "That's stepping up to the plate, that's really putting your money where your mouth is," she said.
As for when the legal system gets involved, Nugent said, "The lawyers do need to be involved, but don't let the lawyers drive this. It's not about contracts or torts, it's about meeting your customer's needs."
"An SLA can literally be one page. The length of an SLA is not directly proportional to how good it is," she observed. "Your SLA is only as good as your ability to measure it and report on it. You'd better be able to scale, because the big guys are coming. ... They'd outsource in a minute if they could find someone to deliver on the SLA."
"The fact that we have to have these documents indicates that the customer is not real sure that you're credible enough," Nugent concluded.