Service Design, Management and Composition: Service Level Agreements Objectives

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2 Objectives! motivation for service level agreements! definition / measurement of levels! management of SLAs! formal representation 2

3 Content! definition! example! metrics! negotiation! optimization! monitoring! frameworks 3

4 Motivation! service cannot be checked before delivery! often services are supplied for a continuous period! variability in supply! operationalization of quality management Benefits! stronger relationship between service provider and customer! customer perspective! consistency! better prioritization! demonstration and quantification of value 4

5 Definition! a performance-based technique where a written agreement (contract) is established between customer and service provider defining " key service objectives, " metrics, and " acceptable quality levels 5

6 Applications! SLAs used since late 1980s by telecom operators as part of their contracts with corporate customers! SLAs for outsourcing of functions such as human resource management, help desks or call centers! SLAs in IT Management (e.g. in IT Infrastructure Library in the early 1990s)! SLAs in supply chains (e.g. beer game)! SLAs in Service Oriented Architectures! SLAs in Cloud Computing (e.g. Google s SLA)! SLAs in USDL 6

7 Example: Beer Game! wholesaler W asserts a certain service level using a performance measure fill rate = 1 (expected backorders per week/expected orders) for instance W asserts (guarantees) fill rate 0.8! W has 8 units on stock, R orders 10 units and receives 8 units in next week! no violation, no penalty Wholesaler W Order Process Procurement Process 10 units beer deliver 8 units beer 2 units backorder Retailer R Order Process Procurement Process 7

8 Example continued! now two retailers R 1 and R 2 each ordering 5 units! retailer R1 receives 5 units -> actual fill rate = 1.0 no problem, no complaints! retailer R2 receives only 3 units -> actual fill rate = 0.6 violation of SLA -> penalty Wholesaler W Order Process order 5 units beer deliver 5 units beer Retailer R 1 Procurement Process Procurement Process order 5 units beer deliver 3 units beer 2 units backorder Retailer R 2 Procurement Process 8

9 ! service provider! service consumer! assertions Elements " provider: I guarantee you that... " consumer: I demand from you that... " negotiation! performance and quality metrics " supply chain management: fill rate " help desk: average speed to answer " IT hardware: availability " software: average response time! measurement! penalty, compensation for violation of assertion 9

10 Service Quality Attributes / Metrics! reliability (correct operation)! availability (time when service is available)! usability (user experience)! security (confidentiality, authenticity, integrity)! performance (response time, throughput, timeliness)! scalability (more or better resources)! extensibility (of individual services w/o disturbing system)! adaptability (reuse in different contexts)! interoperability (use of standards)! auditability (storing records for financial or legal audits) 10

11 Service Levels! service level is output-based (e.g. provider guarantees fill rate)! however, also responsibility of customer (e.g. how and when to order)! multilevel services different customer groups! e.g. gold, silver and bronze customer gold: fill rate 1.0 silver: fill rate 0.9 bronze: fill rate

12 Service Level Negotiating! the involved parties have to agree upon the components of SLA " period " reporting " compensation! Service-Based SLA: An agreement for all customers using the services! Contract 1: " Parties: Provider W, Client R 1 " Order fill rate: 0.8 per time period, compensation: 10% discount on backorders, limitation: excessive order size(100% above average order size)! Contract 2: " Parties: Provider W, Client R 2 " Order fill rate: 0.8 per time period, compensation: 10% discount on backorders, limitation: excessive order size(100% above average order size) 12

13 Service Level Optimization! In our example:! Guaranteed fill rate >=.8! R 1 orders 5 units and receives 5 units, fill rate = 1.0! R 2 orders 5 units, receives 3 units, 2 units backorder, fill rate=.6! Compensation: 10% discount on 2 units! SLAs can guide optimization process: cut R 1 's lot by 1 and add it to R 2 's lot! both have service level 4/5 =.8 in line with SLAs 13

14 Service Level Monitoring! continuously measuring performance " by provider to guarantee service level " by consumer to detect problems and making claims for compensation " by third party! automated process in some domains 14

15 Service Level Templates! service provider creates and publishes template " outline of service levels " placeholders that can be negotiated! process 15

16 Service Level Frameworks! Web (WSLA) " IBM project " focus dynamic Web services " automated monitoring " shall be applicable also in other domains! Unified Service Description Language " proposal by SAP " Service Level Profile (a set of specifications) " Service Level and obligated party " guaranteed state " guaranteed action " penalties 16

17 Exercise! each group selects a service from their service domain! select five attributes that shall be considered in a SLA (if possible, from the five Rater dimensions)! define three levels of service provision for the five attributes 17

18 Summary! SLAs and management of SLAs are major elements of service design and service usage! potential consumer: compare services in the discovery and evaluation phase! consumer-provider: monitor service quality and performance in the use-phase! collect and analyze data! data interpretation may guide service improvement! provider: SLAs can guide optimization of resource allocations 18