Supplier Management - SLAs and Stopping the Clock

I said in my last post ‘Supplier Management – Roundup and Finish’ that the blog would move away from the Supplier Management topic for the time being. However, I am prompted to return to it today due to a conversation I had with a long-time customer yesterday, who is starting out with Supplier Management and has been following the blog.

The question was this: They have set their system up so that, when an assignment is made to a supplier, the internal Service Level Agreement (SLA) is ‘clock stopped’ until the supplier resolution occurs – is this right?

Our customer had some doubts about this, but had set the system up this way because ‘if the Incident is being assigned externally we (the helpdesk) can’t resolve it so it isn’t fair for it to drag down our statistics’.

My experience is that this is quite a common procedure, but I don’t think it is the right approach to take.

My reasoning lies in What an SLA is, and What an SLA is for – but I’ll start by saying what an SLA is not:

An SLA is not there (or should not be used) to remind you when you have to do things by.

An SLA is the minimum level (or acceptable level) of service required by the business, and it many cases is targeted towards Incident resolution and restoration of services after a fault. If this does not help, consider things from the customer’s point of view.

Imagine you have a customer Carole that deals with your organisation’s customers – the customers who pay invoices and keep your company in business. If Carole has an IT problem that stops her doing her job effectively, what matters is the time that it takes the Helpdesk/Service Desk to resolve her problem. She is unlikely to be interested in the fact that you may or may not have had to use a 3rd party supplier – she has customers to deal with.

This is where the SLA comes in. It’s trying to ensure that there is a reasonable and agreed understanding of when Carole’s problem will be resolved. If you choose to use 3-rd party suppliers then that needs to be factored into the design of the SLA that you have – something that this blog may return to later.