Do you know the power of an agreement? Oh, not those paper documents piled high on your desk. Here, it’s about the agreement between your team. It’s about understanding among the team members taking care of all the operations.
When all departments and team members are on the same page, every project runs like a well-oiled machine. Smoothly and efficiently.
That’s why we have an Operational Level Agreement (OLA).
OLAs are essential because they reduce the chances of errors and miscommunications. They standardize all operations and complement client-side agreements.
So, it’s time you know everything you need to know about OLAs. Here’s the Operational Level Agreement explained. This article also includes a template to help you outline your first OLA.
Let’s dive in.
What is an Operational Level Agreement (OLA)
An Operational Level Agreement contains the scope of work and the objectives to be fulfilled by internal groups while delivering a service. OLAs define the relationships and responsibilities among the teams, communication plans, reporting schedules and many other factors.
OLAs are like elaborate SOPs (Standard Operating Procedures) for different departments. They keep the team in sync for efficient and effective service delivery.
The best description of an Operational Level Agreement, probably, is:
“An Operation Level Agreement is a contract between teams, departments or groups within an organization involved in providing services to other teams or departments.”
Are OLAs any different from SLAs
Yes, OLAs are different from SLAs (Service Level Agreements). Not a lot, but they are. An OLA complements the efficacy of an SLA, like a sidekick.
Let’s suppose you’re a firm specializing in commercial cleaning services. You’re a busy one, with large teams of technicians, cleaners and admin staff. Everyone has their roles separated. No one knows how the others work.
Now, you have an SLA with a customer, say a luxury hotel, for thorough outdoor cleaning once a month. For that SLA to be implemented smoothly, you need your supplies and devices ready on time. That’s where an OLA between the internal teams comes into play.
You can have one OLA specifying the governing rules and responsibilities in general. Or you can have several for each complex project where dedicated teams are needed.
PS: There's yet another specific type of agreement, called an Underpinning Contract, that exists between the service provider and third-party suppliers/vendors. It defines the scope of services of the vendor.
Why is Operational Level Agreement important
The internal Operational Level Agreements define the validity of customer-side Service Level Agreements. They help furnish a reality where the promises of SLAs can be fulfilled. An OLA sets expectations and responsibilities to ensure the necessary service levels are maintained.
OLAs put all teams on the same page regarding what needs to be delivered. It brings them out of the silo.
And here are the reasons OLAs are important for your organization:
- Increased accountability: An Operational Level Agreement document helps to clarify the role of each department involved in delivering a service. OLAs outline the roles and individual responsibilities, so everyone knows what’s expected from them and when. It reduces the likelihood of misunderstandings and delays.
- Enhanced communication: The use of OLAs can simplify communication between different departments. With appropriate modes of communication, everyone can build trust and strong working relationships throughout the organization.
- Streamlined efforts: Having OLAs in place makes it easier for departments to assist each other and to identify areas of collaboration. It reduces duplication of effort and improves service delivery. No more second-guessing what actions to take.
- Optimized service: OLAs ensure that services are delivered according to agreed-upon standards. They lay out metrics for organizations to track and determine service performance and make improvements.
- Satisfied customers: An effective Operational Level Agreement framework makes it easier to meet customer expectations. They ensure effective service delivery at par with expectations. Thus, OLAs also help improve customer satisfaction and retention.
In addition to all those benefits, OLAs ensure all documentations are in place. Everyone knows where to look if they miss a particular detail/instruction.
What are the key elements of an OLA
Now that you’re familiar with OLAs and their importance, let’s dig into their components. The key elements in a standard Operational Level Agreement are:
1) General Overview
The General Overview section identifies the parties and services for which the OLA is outlined. It mentions, in brief, the responsibilities, objectives and purpose of the agreement. Among other things, this section also specifies the contract’s effective date and validity period.
2) Responsible Parties
This section lists all the stakeholders and relevant contact persons associated with the service. It includes the names, telephone numbers and emails of individuals to reach out to. Contact details of third-party vendors can also be added (if applicable).
3) Scope of Work
The Scope of Work section underlines the service description as discussed with the client. It takes references from SLA to specify the agreed upon customer’s requirements, general terms of service delivery, and charges (where necessary). It acts as a 'brief' for the different service teams and departments. This section also mentions the standard assumptions made while drafting the agreement.
4) Roles and Responsibilities
This section is probably the most detailed in an Operational Level Agreement. It lists all the job responsibilities of the stakeholders, whether training, communicating or responding to their service requests. When clients also are stakeholders, even their roles should be described in detail. And if the service has vendor dependencies, vendor activities must also be listed.
5) Operating Hours
It specifies the working hours, response times, and work durations of the supported processes. Expected timelines for normal and major incident handling, problem management and general maintenance are mentioned in this section. Terms for specific work requests and changes that affect service delivery are also mentioned.
6) Service Exceptions
Service Exceptions section in an Operational Level Agreement template outlines the special cases when the services aren’t available. It lists the conditions when the service policies noted in the OLA aren’t valid. It also mentions the exceptions related to coverage times and dates as well as emergency service coverage for business-critical needs.
7) Metrics and Goals
For an agreement to be effective, it needs periodic reviews against the set Key Performance Indicators (KPIs). This section lays down the review schedule, reporting frequency and other terms. And it specifies the condition of agreement and approval of the audits.
How to create convenient OLAs
Drawing up an agreement that represents all OLA operations requires careful planning. You need to consider several key factors. Here are the steps to follow to make OLAs convenient and accessible for the whole team:
1) Define OLA’s scope
The first step to creating a working Operational Level Agreement is to define the scope of the OLA. Start by outlining the purpose of the document and the services it’s going to cover. Then, identify the teams that need to be involved, and their responsibilities.
2) Identify services and exceptions
Next, list the services agreed upon with the client and identify the levels and limits. Apart from identifying the services within scope, include the operating hours, conditions and performance metrics. Collect as much detail as necessary so that nothing is left to ambiguity.
3) Assign roles and responsibilities
Once the services and exceptions have been identified, list all the parties (people and entities) involved in service management. Set targets for each person and fully describe their role in the service delivery. Also, outline the method(s) of communication that parties must adhere to, including their working hours.
4) Document the agreement
Now that all the details are available, document your OLA clearly and concisely. Scribe Page is one tool you can rely upon to collaborate and prepare a well-round OLA. Scribe eases the process, and the agreement documents are accessible to the entire team.
Duplicate this sample OLA template made with Scribe Pages and create your own.
5) Review & revise regularly
Your job isn’t complete at drafting the OLA. It’s important to review it regularly to ensure that it remains relevant and up-to-date. So, agree on a review schedule and assign someone who can take care of it.
Be more efficient with OLAs in Scribe
Scribe is a collaborative documentation tool for teams to ensure efficient service delivery. It comes with a shared workspace for the team to access all documents quickly. You can create quick guides and service agreements and save everything online.
Scribe is the new way to share how-to. It uses AI to automatically step-by-step guides that you can include in your OLAs. And with its feature Pages, you can build countless internal process and handover documents with an easy-to-use free SOP software.
Scribe streamlines operations and helps deliver better services to your customers. It’s among the best process documentation tools out there.
Wrapping it up
When it comes to service delivery, you must keep different departments and individuals in sync. A well-defined and outlined Operational Level Agreement helps you achieve that. It is what keeps you afloat on the promises.
Take Scribe for a trial ride and outline your first Operational Level Agreement format today. See for yourself how efficient it is to prepare an OLA in Scribe.