In the global IT services industry -  for service categories deployment, maintenance, professional services and managed services - I have seen requests from account teams and their customers that include a wide variety of metrics and goals that will make up the core of the service level agreement.

A supplier service delivery team will always want to see minimum number of metrics in a contract and metrics should be easily measured and reported so that the SLA cannot be used to engage in unnecessary discussions that will not improve the customer experience.

In this article I will provide an overview of the most common metrics. In subsequent publications I will expand on how to select the correct service level metric for supplier and partner relationship.

It should not need explaining that for every selected service level metric, the service level agreement will contain a detailed description of the services and an overview of supplier and customer responsibilities as a minimum. I have seen contracts that also include RACI matrices but in my opinion a RACI matrix belongs in an operations manual and not in a contract.

The below table offers an overview of the most significant SLA - not intended to be a complete overview of all metrics - in the IT industry. The list provides:

• Metrics that are listed per service category: Deployment, Maintenance, Service Desk, Cloud & XaaS and General.
• Every category consists of one or more service subcategories: IMACD, Staging, Help Desk, Remote Monitoring, Break Fax, Parts, ….
• Sample values for: coverage times, reporting intervals, typical implementation time from contract start, and metrics values. These are the elements that will need further discussion between supplier and customer and will greatly define the cost of the service.
• Metric values fall into three categories: a success %, a time period, or a combination of time period and success factor.

A performance indicator or key performance indicator (KPI) is a type of performance measurement. KPIs evaluate the success of an organization or of a particular activity in which it engages. Often success is simply the repeated, periodic achievement of some levels of operational goal (e.g. zero defects, 10/10 customer satisfaction, etc.), and sometimes success is defined in terms of making progress toward strategic goals. Accordingly, choosing the right KPIs relies upon a good understanding of what is important to the organization. 'What is important' often depends on the department measuring the performance - e.g. the KPIs useful to finance will really differ from the KPIs assigned to sales. Since there is a need to understand well what is important, various techniques to assess the present state of the business, and its key activities, are associated with the selection of performance indicators. These assessments often lead to the identification of potential improvements, so performance indicators are routinely associated with 'performance improvement' initiatives. A very common way to choose KPIs is to apply a management framework such as the balanced scorecard.

Categorization of indicators

Key performance indicators define a set of values against which to measure. These raw sets of values, which are fed to systems in charge of summarizing the information, are called indicators.

Indicators identifiable and marked as possible candidates for KPIs can be summarized into the following sub-categories:

• Quantitative indicators that can be presented with a number.
• Qualitative indicators that can't be presented as a number.
• Leading indicators that can predict the outcome of a process
• Lagging indicators that present the success or failure post hoc
• Input indicators that measure the amount of resources consumed during the generation of the outcome
• Process indicators that represent the efficiency or the productivity of the process
• Output indicators that reflect the outcome or results of the process activities
• Practical indicators that interface with existing company processes.
• Directional indicators specifying whether or not an organization is getting better.
• Actionable indicators are sufficiently in an organization's control to effect change.
• Financial indicators used in performance measurement and when looking at an operating index.