Page 544 - Handbook of Modern Telecommunications

Network Organization and Governance 4-75

ment among themselves. The overseer makes decisions based on available billing records that
have been collected in or around the peering point.
• Determination of penalties, if required: The overseer determines the magnitude of penalties by
selecting from the alternatives, agreed upon in SLAs. The overseer follows the best interests of the
multinational enterprises by deciding about the right compensation measures.
• Arbitration in case of SLA problems: The overseer executes his/her function as arbitrator when
clients and service providers are unable to reach an agreement about SLA problems. The overseer
makes decisions based on the measurement data submitted by both parties.
• Clarification of mutual access rights to measurement data: The overseer determines who is enti-
tled to access measurement data—read or write or both. These rights could be included in the
SLAs and signed by all participating entities.

4.4.7 Summary and Trends
One of the big obstacles in implementing a Service-Level Agreement is the inability to create a solid
baseline of data to quantify the historical performance of the service provider with various customers.
Without a complete body of historical data, it is difficult to create a meaningful and realistic Service-
Level Agreement, and expectations may be set unrealistically high. Not all tools will capture all of the
components of the network, and the metrics will be incomplete. SLAs of the past have failed due to their
lack of accurate measurement data. Data were manually recorded and were often unreliable. New moni-
toring tools have increased the quality and quantity of data available for SLA evaluation.
In order to reduce the load due to a large volume of collected data, sampling is gaining in importance.
Accuracy is acceptable for both parties and overhead can be kept to a reasonable minimum. Most of
the successful tools work with this principle. Due to mergers and acquisitions, the vendors who provide
tools for SLAs are continuously changing. The big players, such as Hewlett-Packard, IBM, Computer
Associates, and BMC remain serious solution providers. Also smaller vendors may play a role; even open
source solutions could become significant.
High-tech measurements and documented performance of the service provider and operator are
extremely important. The emphasis should be on:

• Efficiency of escalation procedures
• Offering reactive and proactive capabilities
• Speed of component repair and replacement
• Willingness of rectifying problems by corrective actions
• Jointly analyzing root causes of problems
• Unifying and simplifying communication paths
• Taking advantage of Web and intranet capabilities for information exchange

As competition is progressively introduced into all service provision markets and customers become
increasingly discerning, service providers are realizing the need to differentiate their products through
value-added services. Additionally, industry deregulation is transforming a traditionally monopolistic
marketplace into an extremely competitive one. One prime mechanism to combat this is the provision
of an off-the-shelf SLA document that clearly sets out the obligations of both the service providers and
the customer.
In summary, critical success factors for successful SLAs are:
• Clear understanding of QoS metrics
• Powerful data collection and correlation capabilities
• Support of both real-time and historical reporting
• Low overhead of tools for the network, systems, and applications