InformationWeek Analytics New Research Finds Only 4% of SLAs Met All Service-Level Targets Over the Past 12 Months

SAN FRANCISCO, June 24, 2011 /PRNewswire/ -- InformationWeek Analytics, the leading service for peer-based IT research and analysis, today announced the release of its latest research report; Promises, Promises: A Not-So-New SLA Model encompasses analysis of our latest SLA survey results and guides readers in determining how to make the most of external service-level agreements as many IT functions move to the cloud. More than 560 IT service consumers and providers responded to this poll. The report author, Frederick Rose, is the service assurance practice director at Fusion PPT.

Research Summary:

SLAs have long been tough to negotiate and tougher to enforce, especially for small companies that lack the resources to push for the best terms and monitor for compliance. But as we transfer more critical functions to the cloud, it's in the best interests of IT service consumers as well as providers to identify service-level goals—typically regarding availability, performance, security, compliance and data retention—and penalties for failure to meet them. This means sharpening negotiation skills, investing in the right monitoring tools, working with the appropriate providers and going after reimbursement for violations.

Findings:  

• About one-third of service consumer respondents rate the effectiveness of their SLAs 3 on a scale of 1 ("very ineffective") to 5 ("generally very effective"); only 16% rate their SLAs a top-notch 5, although 49% say their providers deliver 95% to 100% compliance.
• 57% of service consumers rely on internal IT to monitor provider SLAs.
• 46% agree it's difficult to monitor service-level targets with public cloud service providers.
• Most (79%) of SLA terms are negotiated.
• The vast majority (96%) of SLAs did not fully meet the required service-level targets over the past year.
• Most (57%) service consumers assess financial penalties on service providers when terms aren't met, yet only 10% say they receive full reimbursement.

For full access to the research data, members can download now: http://www.analytics.informationweek.com/abstract/13/7182/Outsourcing-Services/research-slas.html

"As companies come to rely more heavily on public and hybrid cloud services for infrastructure and applications, SLAs—and monitoring of SLAs—become even more critical," says Lorna Garey, content director of InformationWeek Analytics. "You have to negotiate the right terms up front, based on specific metrics tied to your overall business needs."

"There's a delicate balance between the service provider and the consumer," she adds. "ITIL and other service management frameworks are becoming increasingly important because they integrate SLAs in their operational models and, ultimately, increase efficiency."

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