Customer experience has never been so vital for a business as it is in this day and age. In a cutthroat market with minimal differences between competitors’ features and even pricing, customer service is wielded as the ultimate weapon to win clients over and defeat rival companies. However, the process does not end once a company lands a client. As a matter of fact, this only marks the beginning of the relationship. 

This blog discusses where a service level agreement (SLA) is critical to service providers’ contracts and how it drives positive customer experience. 

customer service SLA

What is an SLA?

An SLA describes the parameters of the service a customer could reasonably expect from a supplier or vendor. This agreement lays out the metrics that both parties could use to measure the quality of a service. It also provides remedies or penalties when the vendor fails to meet the terms. 

On the part of service providers, an SLA is important for managing customer expectations. This document allows them to limit the circumstances when they can be held liable for performance or outage issues for example. 

As for customers, an SLA helps them gauge what the vendor has to offer and compare the terms to the SLAs of competing providers. It also provides an avenue in cases of service issues like reparations in the form of service credits. 

Any contract without an SLA is open to misinterpretation and could be exploited. Hence, the SLA protects both parties involved in the agreement. Ideally, an SLA is aligned with the primary objectives of the supplierrs and the clients. Otherwise, the overall customer experience, particularly the pricing and quality of service, might be at risk.

What happens in SLA breaches

An SLA is used as a guide for both customer and service provider. This makes it imperative that the company closely adheres to the terms set out in the agreement. Failure to do so could result in not only operational losses but also wasted opportunities.  

There’s no one-size-fits-all answer to measure the loss in an SLA breach. Generally, the penalties imposed to erring parties are heavily dependent on two major factors: the commercial negotiation terms and how much damage the breach caused. At times, huge financial fees are collected from the provider while others prefer a “service credit” in exchange for future services. Either way, an SLA breach dramatically reduces a client’s confidence in the provider. While there exists no foolproof plan to completely eliminate this possibility, there’s a way to ensure that measures are implemented to avoid it at all costs. 

Here’s how customer relationship management (CRM) can help.

How CRM can help measure against SLAs

CRM provide a convenient way to track how long service representatives take to resolve support requests. SLAs serve as a logical foundation in drafting key performance indicators (KPIs) and helping teams keep track of their performance against the established KPIs. 

SLAs function as “timers” that customer support representatives can use to see how much time they have remaining until they reach the prescribed period to settle a support request. This can provide a business with an in-depth understanding of the responsiveness of its employees, particularly in addressing the needs of its customers. 

SLAs can also permit CRM users to pause the timer based on the status reason of a particular support request. For instance, if a customer service representative cannot proceed with the required action because the customer has yet to supply the pertinent information, the status reason will be “Waiting on Customer” or “Pending Customer Response.” This will put the timer on pause until the customer service representative changes the status reason. However, the time spent on hold will still be tracked and recorded.

Types of SLAs

The success of a customer support system largely depends on how much time passes from the moment the query is sent up to its resolution. This agreement states the deadlines for resolving issues that both the customer and service provider decided on. That is, SLAs specify the amount of time that the company has to respond and resolve any inquiries from its users. 

While every business has a different SLA, the following are the basic types of agreements between service providers and customers.

Response SLAs

This SLA sets a deadline for every incoming message from clients. Assigning a response time to each query means that customers are not left to wonder when they are going to receive a reply or update. Additionally, an immediate response shows that the company is acknowledging the customer’s concern. Once the clients are notified that a human agent is attending to their query, they are likely to perceive the experience as more pleasant and be more patient while waiting for a resolution. 

Resolution SLAs

Setting an acceptable timeline while still delivering quality results requires a careful balancing act. These are the concerns that resolution SLAs target. Every unique query or issue is assigned a resolution SLA, which includes a deadline for closing or resolving the ticket. This ensures that each customer’s report is handled suitably instead of the agents focusing on closing it as quickly as possible using template responses. 

Issue-based SLAs

Some queries require speedier replies, such as outages or service errors. Issue-based SLAs set unique deadlines for these particular ticket types.

What to do in an SLA breach

Despite taking all the necessary precautions to ensure that all your teams meet the SLAs, committing a breach remains a possibility. Unexpected situations occur, systems experience downtimes, employees overlook certain tasks, and before you know it, you have an overdue response on your hands. While this is not an ideal scenario, the good news is that there are solutions. As long as you don’t make it a habit to breach your SLAs, customers tend to focus more on how you handle the delay instead of the breach itself.

Be honest with your client

There will never be a perfect moment to deliver bad news. It’s best to be transparent about the delay and acknowledge the breach to your customer. Even if the response is not yet overdue, take the initiative to determine whether you can meet the deadline and inform the waiting customer immediately. 

When communicating an anticipated SLA breach, strive to be as open and transparent as possible. Inform the customer of the circumstances that led to the situation. Then, share how your team plans to handle the concern. Most importantly, apologise for failing to fulfil your end of the agreement. As the issue moves forward, make sure you’re consistent in sending updates. 

Review your internal setup for reminders and escalation procedures

Take advantage of automation along with escalations to ensure that every SLA breach is handled as quickly and efficiently as possible. Make sure that the reminders reach the right staff with the capability to take action. Also, ascertain that the reminders are sent early enough for the concerned representative to be able to address it in a timely manner. Revisit the escalation paths and ensure that the right people are involved. Update the management chain for every breach that occurs.

For instance, you can use CRM to implement a colour coding system. You can assign the colour red for instances of breached SLAs. You can use the colour orange to signal that your team only has an X amount of time before a breach happens. You can assign the colour green as a signal to your agents that you still have a lot of time before an SLA is breached. Not only can this system be conveniently set up, it will also provide your customer service support team with a quick and easy guide in terms of which issues to prioritise. 

Review processes to ensure it doesn’t happen again

If you’re detecting consistent SLA breaches, then you’ll need to look closely into the issues and conduct a post mortem to determine the reasons behind them. 

Determine whether your team is getting overwhelmed. If that’s the case, then it might be worth your while to start automating repetitive tasks to ease their workload. Take a look at potential internal bottlenecks that might be contributing to the breaches. If you spot any, review your system to find ways to minimise friction. Learning more about why SLA breaches happen is an important step towards improving the quality of your customer experience. 

Final thoughts

CRM has been widely recognised as one of the most crucial tools in customer service. The modern age has propagated an increasing number of companies searching for ways to exceed expectations and provide a memorable customer experience. Nowadays, companies want more visibility when it comes to what is going on across their business particularly in customer support. CRM offers an automated system that can determine issues like what triggers a breach of SLAs, who breaches SLAs and which process consistently delivers the best results. CRM can also help refine your SLAs and better understand where issues are and how to address them. The insights it provides is very powerful, both for the agents themselves but also for the management team of the business. Not only that, keep in mind that CRM is not only a purely customer support tool. It actually connects the rest of the business including your marketing and sales teams. 

To ensure that your company doesn’t fall behind, make sure you utilise CRM software that can conveniently track your customer support team’s responsiveness and efficiency. Remember—failure to deliver on your end of the SLA is a strong turn-off in this age of selective and demanding customers. 

DOWNLOAD THE WHITEPAPER