Service Level Agreement (SLA) in Outsourcing Contracts - Mastering Techniques to Negotiate, Develop ...

Why You Should Attend This Course:

The 7 Common Mistakes to fail a Service Level Agreement (SLA) must be avoided and the 5 Essentials must be built into a solid SLA.

SLA in Outsourcing Contracts have become a prevalent element in today s business context. Strategic outsourcing can save money and valuable time for any organisations. Whatever differences the business situation may be, careful planning, risks identification and assessment of one s requirements are absolute musts for any organisations before embarking on this outsourcing journey. It is important to build a solid SLA for effective working relationship to flourish between the vendor provider and the customer, so as to achieve the agreed performance standards and Key Performance Indicators.

SLAs are becoming standard business practices across a broad spectrum of industries. They have developed as a result of businesses placing greater emphasis on the need for speedy and quality service to compete and survive in today s crowded marketplace - service quality is often seen as the deciding factor that wins and retains customers.To compete successfully, companies must proactively manage the quality of their services. Since provisioning of these services is dependent on multiple partners and management of partner services, SLAs are critical for success in defining and managing expectations among partners for performance, customer care, billing, service provisioning and other business areas including Service Level Management.

This 2-day course will equip you with the knowledge and techniques to devise and develop a solid Service Level Agreement, and also introduces strategies for developing a robust outsourcing process and guiding principles that govern every outsourced project. This is essential to reduce the level of risks in the outsourcing equation. It also explores how a manager can work effectively with vendors and consultants to foster stronger partnership, and values for continuous learning for business sustainability.

To enhance practical learning and application, written exercises will be provided. A sample Outsourcing Contract with SLA will be given to each participant, including a detailed "clause-by-clause" analysis of the document.

Learning Outcome

• Understand the role of Service Level Agreement (SLA) and how to align it to business objectives and goals
• Develop a robust SLA framework (strategy, process map and structure) to monitor, measure and evaluate on deliverables of contract terms and set achievable targets that work
• Using techniques to measure and evaluate service level performance
• Understand legal implications of non-compliance to the agreement and how to safeguard your business through robust Service Level Management (SLM)
• Liquidated damages and doctrine of penalties
• Developing well thought out termination or exit strategies to minimise business risks and complications
• Managing & handling disputes effectively, remedies and termination due to SLA failure
• Learning negotiation PIOC techniques
• Sharing Best practices in Break-through Strategies in Difficult Negotiations

Course Outline:

Why Do We Need Service Level Agreement (SLA)?

• Services and parameters of service defined
• Objectives and features of SLA
• Value for money through competition

Negotiating a Solid SLA

• Problems in positional bargaining
• Alternative to positional bargaining
• Harvard Principled Negotiation Techniques
• PIOC strategies
• Getting to Yes to all terms & conditions
• Beware of negotiation pitfalls

Five Breakthrough Stages of Difficult Negotiations

• Break-through barriers to co-operation
• Recognise tactics & dirty tricks Do not React
• Create favourable climate Do not Argue
• Encourage joint problem solving & expose their tricks Do not Reject
• Build a golden bridge Do not Push
• Use power to educate Do not Escalate
• Sharing tips used in negotiation process
• Role play exercise Handling Difficult Negotiations

What SLA should cover?

• Scope of services and work
• Service performance level & KPI
• Measurements, benchmarks and targets utilized
• Operational details
• Performance monitoring and tracking
• Charges & service credits
• Reporting analysed results
• Regular reviews by both provider and recipient
• Problem management
• Resolution of disputes and default
• Fees and expenses
• Customer duties and responsibilities
• Duty of care and hours of work
• Variations of requirements and amendments to SLA
• Doctrine of variation at common law & 4 exceptions
• Price adjustment clause
• Work scope adjustment
• Exit terms
• Exercise - Problem-based case question to do

Responsibilities of SLA

• Realistic expectations
• Performance goals and measurements
• Allocation of proper resources to deliver required work
• Define key services offerings
• Constraints
• Maintenance schedules
• Addendums e.g. contact list or critical
• Record outputs
• Important post termination activities
• Identify disputes early
• Explore resolution scenarios
• Avoid disputes
  • Providing feedback 2 way channel
  • How to play for exit strategy procedures

Communication Strategies in Service Level Management (SLM)

• How to prevent service level breakdowns?
• Dealing with problems and avoiding conflicts
• Create effective communication strategy
• Types of communication tools and techniques
• Effective meetings
• Training sessions
• Publications
• Personal contact list
• Presentations
• Intranet
• Avoiding conflicts and problems

Managing the Parties

• How to manage and collaborate with suppliers
• What must be managed?
  • Demands
  • Expectations
  • Perceptions
• Managing customers / recipient / client
• Managing vendor / supplier / provider
• Managing staff / personnel
  • Problems internal customers/staff cause for SLA
  • How to avoid internal conflict
  • Poor internal communication
• Case-study

Services, Service Levels & Key Performance Indicators (KPI)

• Defining the specific services
• Principles in drafting service requirements
• What, where and how to measure?
• Role of senior Management in measurement Progress
• Service Credits, charges, penalties
• Escalator clauses
• Bonuses

Planning a Balanced SLA document in Outsourcing Contract

• Description of services
• Service monitoring
• Charging for services
• Intellectual property issues
  • Patent
  • Trademark
  • Copyright
• Improvements and gain sharing
  • Quality improvements
  • Cost saving improvements
  • Higher productivity and higher profits
  • Gain sharing and base-line measurements
• Confidential and secret information
  • Defining Confidential Information in a Contract
  • Confidentiality as Professional responsibility
• Risks
  • Contractual allocation of risks
  • Third parties contributing to risks (sub-contractors)
  • Usage of Performance Bonds, Securities and Insurance
• Jurisdiction, choice of law and dispute resolution
  • Mini-trials
  • Mediation arbitration clause

Clauses in Service Levels Agreements

• Analysis of sample contract clauses
• Quiz and exercises

Who Will Benefit?

This course is suitable for any individual who is involved in the Service Level Management process, whether at a technical, operational, supervisory or managerial level. It is also suitable for any Personnel from various functions such as IT, Supply Chain, Purchasing, Sales, Financial, Service Delivery, Contract Management, Commercial Planning, Quality Control and Outsourcing etc.

Trainer s Profile:

Prof Catherine Tay Swee Kian is an Associate Professorial Fellow lecturing law at the National University of Singapore, Department of Strategy and Policy (NUS Business School). She is also an Advocate and Solicitor of the Supreme Court of Singapore and an author of several law books, including contract law book. She is a Barrister-at-Law from Lincoln s Inn, United Kingdom.

Prof Tay studied law at Queen Mary College, University of London and graduated with a Master of Laws, in which she specialised in Company, Shipping, Insurance and Marine Insurance Laws. She did her pupillage under the Honourable Lady Mary Hogg in London and returned to Singapore in the law firm of Rodyk & Davidson.

Prof Tay was on the Board of Overseas Editors for the (United Kingdom) Journal of Financial Crime, an official publication of the Cambridge International Symposium on Economic Crime. She has presented papers at many conferences and seminars on Business Law, Medical Law, Company and Insolvency Laws both overseas and in Singapore. Prof Tay is an examiner on law subjects for a number of professional bodies in Singapore and overseas. She also conducts in-house seminars for hospitals, banks, statutory boards, hotels, commercial firms and companies, clubs and associations.

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