Diagnostic Questions Template for SLA & Service Credits

Quick answer

In negotiating Service Level Agreements (SLAs) and service credits, using diagnostic questions can help clarify expectations and ensure alignment between parties. This template offers a structured approach to uncover key issues and facilitate productive discussions.

Understanding Diagnostic Questions

Diagnostic questions are a crucial tool in SLA negotiations, helping to probe deeper into the needs and concerns of both parties. These questions can reveal underlying issues that may not be immediately apparent, allowing for more effective problem-solving and agreement.

Importance of Diagnostic Questions in SLA Negotiations

When negotiating SLAs and service credits, the stakes are high. Poorly defined service levels can lead to dissatisfaction and financial losses. Diagnostic questions help to:

• Clarify the specific expectations of each party.
• Identify potential gaps in service delivery.
• Establish a basis for service credits in case of non-compliance.

Template for Diagnostic Questions

Below is a template to guide your diagnostic questioning process during SLA negotiations. Feel free to adapt these questions based on your specific context.

1. Clarification Questions

• What are the critical services that need to be covered under this SLA?
• How do you define success for each service?
• What metrics will be used to measure service performance?

2. Expectation Questions

• What is the acceptable level of uptime for this service?
• How quickly should issues be resolved based on their severity?
• What are your expectations regarding communication during service disruptions?

3. Risk Assessment Questions

• What potential risks do you foresee in this agreement?
• How do you handle service failures currently?
• What are the consequences of not meeting the agreed-upon service levels?

4. Service Credit Questions

• What types of service credits are acceptable if service levels are not met?
• How will the calculation of service credits be determined?
• What is the process for claiming service credits?

Concrete Negotiation Scenario

Imagine you are negotiating a service agreement for cloud storage services. Your company requires 99.9% uptime, and the proposed SLA includes a service credit of 5% of the monthly fee for each 1% below the agreed uptime.

Example Calculation:

• Monthly fee: $10,000
• Required uptime: 99.9% (which allows for about 43.2 minutes of downtime per month)
• If the service provider achieves only 99.0% uptime (equivalent to 43.2 hours of downtime), the calculation for service credits would be:
  • Uptime shortfall: 0.9% (99.9% - 99.0%)
  • Service credit: 0.9 x 5% of $10,000 = $450

In this scenario, diagnostic questions could clarify what happens if the service provider consistently fails to meet the 99.9% uptime requirement, leading to a more robust agreement.

AI Prompts to Practice

• What questions would you ask to ensure both parties have the same understanding of service expectations?
• How can you use diagnostic questions to uncover areas of concern in the SLA?
• What strategies can you implement to negotiate favorable service credits?

Conclusion

Utilizing diagnostic questions in SLA and service credits negotiations is not only strategic but essential for fostering a transparent and collaborative negotiation process. By clearly defining expectations and potential consequences, both parties can mitigate risks and enhance satisfaction.

For personalized insights and support, explore our AI negotiation co-pilot to elevate your negotiation strategies.

Further reading

• Use this Harvard Law checklist to prepare for any negotiation
• Understanding BATNA: Your Best Alternative to a Negotiated Deal
• What is BATNA? How to Find Your Best Alternative to a Negotiated ...

FAQ

1. What are the main components of an SLA?
An SLA typically includes service descriptions, performance metrics, responsibilities, and terms for service credits.

2. How can service credits be calculated?
Service credits can be calculated based on the percentage of the service level not met, often expressed as a proportion of the monthly fee.

3. Why are diagnostic questions important in negotiations?
They help uncover hidden concerns, clarify expectations, and establish a strong foundation for the agreement.

4. What happens if the SLA is not met?
Typically, the service provider may owe service credits or other penalties as defined in the SLA.

5. Can SLAs be renegotiated?
Yes, SLAs can be renegotiated based on changes in business needs or performance issues.

Disclaimer: This article is for informational purposes only and does not constitute legal or financial advice.