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Using Operating Level Agreements in Multisourcing

by: Sarah Joson

Wednesday, February 27, 2013 | Outsourcing News |

Operating level agreements (OLAs) were commonly used internally between two departments or between a client and an IT services provider.  But as more and more organizations begin to use multisourcing arrangements, OLAs are rapidly becoming the intermediary among several service providers and client - making sure that things will run smoothly and as planned.

However, creating an OLA that will work across the entire operation is a tedious task as it is expected to cover all the needs and recommendations of all parties involved.

What to expect from using operating level agreements

CIO.com shares nine things that clients involved in multisourcing can expect from using operating level agreements (OLAs):

There will definitely be challenges along the way.
The OLA service provider needs to supervise their own operations, as well as oversee if other service providers involved in the operation are on the same level. However, if maturity levels of all providers aren’t the same, then they would have to work on it or create an environment that is fair for all.

The OLA should always be protected from scheming providers. Some providers might take advantage of the OLA and use it to their benefit. Some of them use it against the client’s SLA and create a loophole that can overrule a clause needed for another service provider. All the IT providers, including the client, should discuss any uncertain matter.

OLAs should go first. OLAs should be used as a guide for the entire operation. Having to draft it after sending out RFPs and building relationships will only cause problems in the long run.

Establish internal OLAs first. No matter how many providers are involved and how many processes are worked on by external service providers, the internal IT group and CIO should remain as the core group of the entire operation. This assures the executives that their employees are also accountable should there be a problem in the future.

Clearer directives get the job done faster.
OLAs plagued by jargon will be useless if only a few can understand it. Things will be done faster and everybody will be more attentive to the OLA if it’s concise and straight to the point.

Customers always come first
. Some service providers will offer a business OLA to help their company grow. For instance, some might present an OLA that restricts the client. This is one thing to look out for.

Clients can be exempted from the OLA. No matter how detailed OLAs are, clients still have the option to be exempted from the provisions and clauses included in it.

Let the OLA do its thing. Clients should not micromanage providers. The OLA can get the job done, but if the providers do not meet the expectations, that would be the only acceptable time to step in and address the problems.

Evaluate if your OLAs are effective
. OLAs, if tracked, can provide sustainable metrics that can give clients, as well as providers, a better perspective of their performance.  

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