Software as a Service

SaaS Service Level Agreements

These recommendations for SaaS SLAs (service level agreements) are a must-read for anybody who is about to entrust their systems and data to an SaaS vendor. Why? Because without the right SLAs, your company could be extremely vulnverable.

When it comes to SaaS solutions, the level of service you can expect to receive from your provider is a critical factor in both your buying decision and the functionality of the application.

Many SaaS vendors promise the world during the sales cycle, but later fail to deliver on their promises. As a small business owner, you can't afford to leave anything to chance - and that means you will need to rely on service level agreements to ensure a smooth software experience.

Service level agreements are agreements between SaaS providers and their clients that describe the services that will be performed, usually in measurable terms. SLA's can be included in your SaaS agreement or can be standalone documents. Either way, you will need to rely on them to protect your interests throughout your relationship with the provider.

Although the contents of SLAs can vary, there are some standard issues that should always be addressed. In fact, SaaS experts suggest that SLA's address at least five different service areas.

  • System availability. As an SaaS client, you will rely on system uptime for access to your business applications and data. An SaaS solution that is constantly being updated or experiences frequent downtimes is simply not acceptable. Your SLA should address monthly availability averages and articulate penalties that are incurred if the provider fails to hit availability targets.
  • Response time. In some instances, you may have access to the system even though system performance is severely limited. Unresponsive hosted applications can bog down your workplace so it's important to make sure your SLA specifies average monthly response times and the consequences for poor system performance.
  • Problem resolution. A good SaaS provider understands that system malfunctions and errors need to be resolved quickly. But unfortunately, you can't count on their word that they will be responsive to issues. That's something that will need to be addressed in an SLA with specific details about how common problems will be handled.
  • Disaster recovery. It's possible that your provider's technology infrastructure could suffer a catastrophic event. If that happens, you need to know how long it will be before service is restored. Data recovery SLAs are critical for providing assurances that the system will be up and running again as quickly as possible.
  • Database transition. Sooner or later, your business will transition to a different business application. Your SLAs should address the provider's responsibility for migrating your data back to you when you transition to another solution.

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