It is common to find service-level-agreements (SLAs) between departments and/or between organisations and their suppliers in service organisations.
But they are, in fact, a cause of poor quality service and higher costs. Why? In simple terms: because they are arbitrary measures.
Working to meet SLAs drives peoples’ focus to make their numbers; and because these numbers are arbitrary, working to them will only distort the system and increase the probability that poor-quality work will be passed on.
SLAs are used to allocate blame.
SLAs can be a constraint on improvement.
SLAs cannot be used to understand or improve performance.
SLAs tell you nothing about capability – the starting-place for effective improvement.
SLAs fail the test of a good measure.