As far as the OLA is concerned, it is an agreement between the internal support groups of an institution that supports ALS. According to the agreement at the operational level, each domestic support group has certain responsibilities towards the other group. The OLA clearly describes the performance and relationships of internal service groups. The main objective of the OLA is to ensure that all support groups provide the planned level of service agreement. Note: When requests are disaggregated, plan changes to forecasts. This is crucial because you can`t have lower executives working on a longer operational schedule than the next level of senior management. When KPIs are aggregated in the hierarchy, the key figure moves to measurement. 2. A service level agreement is essentially a contract between a service provider and a customer. The OLA is an agreement between the internal support groups of an institution that supports ALS. If an SLA is in place, the service provider and customer will regularly assess, communicate and adjust the measures to comply with the agreement.
While an SLA can be part of a legal contract, a contract is not necessarily an SLA, as contracts can be entered into without describing service levels. At this level, leading indicators are more important. Eg. The number of orders placed is a leading indicator of operational status. If you do not buy anything, you will run out of production equipment and the company will stop. Trade receivables and accounts receivable are key indicators of financial health. If you do not incur (sell) debt and/or collect the debt, you go bankrupt. Inventories are leading indicators of sales. The increase in inventories can mean that sales are decreasing and the company is running out of working capital. If the underlying OLAs aren`t there, it`s often very difficult for companies to go back and make agreements between support teams to deliver the SLA.
The OLA(s) should be considered as a basis for best practices and a common agreement. These relationships differ from the horizontal view in that neither the supplier nor the customer has authority over the other. The supplier is responsible (formally or informally) for providing services to the customer. (Services include delivery of the product). The contract is managed by monitoring compliance with service levels (SLAs) imposed on the supplier by the customer. This typically includes key performance indicators on time, cost, and quality. Typically, process-level SLAs are best suited for managing the relationship between the front and back office, or customer-centric, revenue-generating processes, and non-customer-centric processes that support revenue. .