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External SLA's DO Matter - Part 1

Internal SLA's maybe not - Stay Tuned for Part 2

The Intuit outage on Tuesday night, June 15th that lasted 36+ hours, affecting hundreds of thousands of customers and one third of the $1.607 B in revenue as reported for the Software-as-a-Service (SaaS) offering of it's Turbo Tax Online, Online Banking , Small business Accounting, Online Payroll and Intuit Website spurs this much awaited blog entry - Do SLA's matter? YES!

http://www.pcmag.com/article2/0,2817,2365179,00.asp

Intuit also went down on April 15th a few years back costing themselves millions in late filings and penalties, but in reality it represented 1-2% of the revenue for this product. However, again illustrating, if you cannot figure out the ROI of management practices, the press will figure it out for you!

This latest outage called into question the viability of Cloud computing and "as-a-Service" offerings. As an ex-Analyst, I would debate heatedly that this is not a failure of the technology or the Cloud as it is the future, but a failure of mature management practices and responsibility of the customer to define expectations of service delivery. New technologies come, go into production and management is always a laggard in the implementation. This calls out, IT and businesses are looking for the "short cut" and cost cutting and as my father always told me, "short cuts never got anybody anywhere fast". One of many southern proverbs passed along.

Business is frustrated and wants change, wants a cheaper service and outsources to create change and neglects to put in place the stringent SLAs to manage the service. IT delivers a service via an as-a-Service model with the mentality of "it's not my fault" when it is their responsibility to manage the service whether they deliver the service directly or indirectly.

The Cloud and as-a-Service naysayers in my opinion are the "I told you so" IT folks not owning their responsibility of the service and protecting their turf. Technology will always fail - given. It's how we mitigate that risk and what we put in place to respond appropriately that matters and it is the responsibility of the customer to drive the "right" behavior into the service provider via SLAs. The more stringent the SLA, the more it will cost, but short cuts generally never save money in the end.

Advice

Drive the behavior you require for your business and the criticality of the service with the SLA to the service provider. Don't ask for stringent SLAs if you can survive an outage such as the Intuit outage as you will pay for redundancy and those guarantees. Remember you as the IT organization are still responsible for the service, monitor your service provider with user experience monitoring and demand service level and management practices. Remember an SLA has 3 parts: Availability, Performance and Response to an event and define these based upon the criticality of the service to your organization and create realistic expectations for these metrics of service delivery and how it will be reported to your organization.

Service providers who will survive this technology tipping point will illustrate management capability and competence (remember the dot com bust, the ASPs, MSPs, etc and how many are still around?) and will be able to proactively manage and report service deliery to their customers. Short-cuts to deliver service, take money without management in place will come back to haunt those service providers and only the strong will survive this rush to market.

Service Provider SLAs and Management Practices Matter and The Cloud is the Future!

Disclaimer: As with everything else at Cool Solutions, this content is definitely not supported by Novell (so don't even think of calling Support if you try something and it blows up).

It was contributed by a community member and is published "as is." It seems to have worked for at least one person, and might work for you. But please be sure to test, test, test before you do anything drastic with it.