Service Level Agreements and Capacity Planning

In presenting Service Level Agreements to Sage partners over the last few years, I always believed that I was doing a more than adequate job explaining the concepts required to make them successful (three levels and a hook). However, it was not until recently that I think I have stumbled across the words that drive the concept home.

Most Sage partners do not have a specific on-going service agreement with their customers. Rather, they have a list of customers who call in when they need them. A partner could have 250 or even 1,000 of these types of relationships. Here is the problem (and finally the right words) — You cannot plan capacity when your customers are on a pay-as-you-go basis.

As I think about this, my bet is this affects lawyers more than it does accountants. Accountants have the advantage of a government sponsored impending annual event. (Translation, a tax return.) In software technology, we have no such event. Upgrades are 18 to 24 months apart and are optional in most cases anyway.

Back to my main point — You cannot plan capacity when your customers are on a pay-as-you-go basis — this phrase really has seemed to spark interest in creating service level agreements more than anything else I have said, so I thought it was worth passing along.

Sorry for the ramble, but my point was to let you know that sometimes it takes years find the words that really work.

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