Welcome!

Agile Computing Authors: Pat Romanski, Liz McMillan, Elizabeth White, Yeshim Deniz, Ed Featherston

Related Topics: @CloudExpo, Agile Computing, @DevOpsSummit

@CloudExpo: Article

A Practical Guide to SLAs | @CloudExpo #APM #SaaS #Cloud #DevOps

An SLA is a contractual agreement between a vendor and a customer, stating that the vendor will deliver on agreed upon terms

A Practical Guide to SLAs
By Mehdi Daoudi

While visiting a customer last week (a large SaaS platform company), we started to have an interesting discussion around Service Level Agreements (SLAs) during which he encouraged me to write this blog.

When I was tasked with setting up the QoS Team at DoubleClick in 1999, the primary mission was to setup a monitoring team (internal, external, etc.) and the secondary mission was actually an accidental one: to manage our SLAs.

This became a hot priority in 2001, we paid out over $1 million (in real money) in penalties for SLA violations to a single customer. Basically, someone on our side signed a contract with insane service commitments like 100% uptime.

When we started to tackle this problem we were novice and had to ramp up quickly to stop those kind of penalty payments—we were in a crisis mode. My CFO was breathing down my neck every day with the same question, over and over again: “Are we going to breach anything today?”

Today, I am sharing my journey of how I took control of our SLAs as a ASP (back when SaaS was still an Application Service Provider), and everything you need to know to do the same.

Part 1: What are SLAs?
An SLA is a contractual agreement between a vendor and a customer, stating that the vendor will deliver on agreed upon terms. The SLA is the legal umbrella, under which you have one or more Service Level Objective(s) (SLO) which describe the Service, measurement methodology, and objective (uptime, speed, transaction / seconds, etc.). The definition below describes how an SLA covers the customer and the vendor:

  • Customer: An SLA benefits the client by providing objective grading criteria and protection from poor service.
  • Vendor: An SLA benefits the supplier by providing a way of ensuring that the correct expectations are set, performance will be judged fairly and that the supplier is incentivized to improve quality of services.
  • For SLAs to be implemented, we also agreed on the following key principles:
    • Attainable
    • Repeatable
    • Measurable
    • Meaningful
    • Mutually acceptable

Part 2: Ground zero, discovery
The first few weeks were spent compiling the list of all the contracts, extracting SLAs, SLOs, penalties, and putting that in a database.

Then I went to start the education process with the business stakeholders, legal, and our leadership.

As you can see, I focused on end-user experience based SLAs from an early stage.

Part 3: Establishing an SLA is more than just putting a few sentences in the contract.
The reason we paid $1 million is that there was no SLA Management System in place.

We started then by building a Service Level Management practice that relied on 4 pillars: Administration, Monitoring, Reporting, and Compliance (AMRC).

SLM Process

Then we sat down with the business partners, customers, legal, and finance team and created a process to avoid costly mistakes in the future, an SLA lifecycle. We reviewed the SLM quarterly:

Process SLM

We then used our in-house Data Scientists to run simulations on the risk to breach SLAs based on the historical data we had from our monitoring tools. You do not want to set SLA that will be breached every day.

SLA probability

We also ran multiple “what-if” scenarios on availability vs. revenue and the impact at various hours of the day and days of the week:

What If Scenario

We even created an online tool (2001) for our sales team to be able to request an SLA portfolio for a customer that would be reviewed and approved by our QoS team; think of this as an “SLA desk.”

SLA Request

Part 4: External SLAs and internal SLAs.
In these early stages of this project, we quickly discovered a major glitch: the external SLAs were not matching the internal ones. And that, in my opinion, was going to be a huge mistake—how can we ever achieve such goals, talk the same language between the tech, business, and customers when everything was so different? Customers would ask for ad serving uptime and our tech group would use servers availability!

So, we aligned our external and internal SLOs and made the internal objectives (the targets) very very high. This was a huge victory because it allowed us on a daily basis to rely on one set of metrics to understand our SLA risk position, but also to drive operational excellence. Our tech group (Ops, Engineering, etc.) became sensitive to the notion of a business SLA and started to care very much about not breaching them.

Part 5: Monitoring
For availability and performance, we relied on three synthetic products; internally, Sitescope was running in 17 datacenters, and two external synthetic products. We wanted to have as many data points as possible from as many tools as possible. The stakes were just too high to not invest in multiple tools. This entire SLM project was not cheap to implement and run on an annual basis, but I also knew the cost of not doing it right the hard way.

For monitoring it became clear to us that we needed to test as frequently as possible from as many vantage points as possible:

  • When you test your SLOs end points every 1 hour, you have to wait 59 minutes after each check! So you could be inflicting yourself with false downtime.
  • You want many data points to ensure statistical significance. You could use small datasets, but you will tend to have lower power and precision. Bigger datasets are also better for dealing with False Positives and False Negatives.

Part 6: Performance (speed) monitoring
One of our biggest difficulties was finding an effective way to measure the performance of third-party providers – and implementing that technique in SLAs.

The challenge was that clients would look at their site performance and notice spikes and they would attribute it to our system, meanwhile our performance chart would not show any problems. We couldn’t correlate the two charts, therefore we couldn’t come to an agreement whether it was our problem or someone else’s problem.

We created a methodology we called Differential Performance Measurement (DPM).

The philosophy behind DPM was to be able to measure the performance and availability of Doubleclick’s services as accurately as possible and its impact on the pages of our customers, making sure we were responsible and accountable for the things we had control over to eliminate the finger-pointing.

The methodology added context to the measurements. DPM introduced clarity and comparison, removing absolute performance numbers from the SLAs.

Recipe for Differential Performance Measurement (example with an advert.):

1- Take two pages, one without ads and one with one ad call.

  • Page A = without ad
  • Page B = with ad

2-  Make sure the pages do not contain any other third-party references (CDNs, etc.).

3- Make sure the page sizes (in KB) are the same.

4- “Bake” – Measure response times for both pages and you get the following metrics:

  • Differential Response (DR) will be (Response Time of page B) minus (Response Time of page A)
  • Differential Response Percentage (DRP) = DR / A. (e.g. If Page A is 2 seconds, and Page B is 2.1 seconds, DR is 0.1 second, and DRP is 0.1/2=0.05 or 5%)

With this methodology, we were able to eliminate noise introduced by:

  • Internet-related issues that were out of our control (fiber cuts, etc.)
  • Monitoring agent issues (which raises the separate topic of monitoring your monitoring services)
  • Other third parties

  • Scenario 1: The ad serving company is having performance problems and negatively impacting the customer’s site performance. The vendor breached the SLA threshold from Time 4 to Time 8.
  • Scenario 2: The website is having performance problems that are not caused by the ad serving company.

Part 7: Reporting
Because of that huge payout, the entire SLM project had a lot of visibility that extended all the way to CEO. We reported monthly on our compliances and our internal SLAs, breaches were detected in real time (thanks to a clever tool DigitalFuel, that, sadly, no longer exists.).

The external SLOs were just a subset of the internal SLOs; when we were done in late 2001, we were tracking over 100 OLAs.

OLA

I cannot stress enough that if you are going to embark on this journey, you better report a lot! But, also make sure the reports are actionable (Green, Yellow, Red).

Example of a monthly Report:

MonthlyReporting

Example of our daily reporting during our Daily Health Check meeting:

dailyreport

A Culture of Quality emerged at DoubleClick because everyone was aligned around these business service metrics. No one wanted to breach SLAs, no one wanted to let down the customer.

Part 8: Conclusion
After doing this exercise of implementing what I would consider in the early 2000s to be a comprehensive SLM process, we were able to:

  • Manage hundreds of contracts with up to five SLOs.
  • Offer a wide range of SLAs that were scalable (adding new products).
  • Reduce the financial risks to our company.
  • Manage our reputation and credibility by giving meaningful SLAs and reporting on them with accuracy and integrity.
  • Real time alerts of compliance breach. Knowing ahead of time that an SLA will be breached was incredible; we would know that adding four minutes of downtime will breach 12 contracts and result in $X, so Ops took steps to stop releases or anything that could have an impact on uptime.

Some people do not believe in SLAs. Bad SLAs are the ones that some companies put in the contract without real penalties or real measurements. I always see the SLAs that guarantee 0% packet loss, but if you ask how it’s measured, you quickly realize that it’s useless—this is exactly what gives SLAs a bad reputation.

I believe that SLAs are a great way to align customers and vendors, reduce frictions, and stop the finger-pointing. But, customers also need to do their jobs and ask for useful SLAs. The point is that you want to hold the vendors accountable, not to drive them out of business. You want them to feel the pain of not doing a good job when they do not deliver the service for which they are being payed.

As the “Cloudification” of our world expands, SLAs are here to stay and they are going to become even more prevalent. Customers of these services like cloud servers, cloud applications (Office365, Salesforce, etc.), services (DNS, CDN, Security, etc.) will see customers demanding more meaningful SLAs, stricter enforcement, and more penalties. This is the only way forward.

The post A Practical Guide to SLAs appeared first on Catchpoint's Blog.

More Stories By Mehdi Daoudi

Catchpoint radically transforms the way businesses manage, monitor, and test the performance of online applications. Truly understand and improve user experience with clear visibility into complex, distributed online systems.

Founded in 2008 by four DoubleClick / Google executives with a passion for speed, reliability and overall better online experiences, Catchpoint has now become the most innovative provider of web performance testing and monitoring solutions. We are a team with expertise in designing, building, operating, scaling and monitoring highly transactional Internet services used by thousands of companies and impacting the experience of millions of users. Catchpoint is funded by top-tier venture capital firm, Battery Ventures, which has invested in category leaders such as Akamai, Omniture (Adobe Systems), Optimizely, Tealium, BazaarVoice, Marketo and many more.

@ThingsExpo Stories
Announcing Poland #DigitalTransformation Pavilion
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
CloudEXPO | DXWorldEXPO are the world's most influential, independent events where Cloud Computing was coined and where technology buyers and vendors meet to experience and discuss the big picture of Digital Transformation and all of the strategies, tactics, and tools they need to realize their goals. Sponsors of DXWorldEXPO | CloudEXPO benefit from unmatched branding, profile building and lead generation opportunities.
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution. In his session at @ThingsExpo, Akvelon expert and IoT industry leader Sergey Grebnov provided an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
DXWorldEXPO | CloudEXPO are the world's most influential, independent events where Cloud Computing was coined and where technology buyers and vendors meet to experience and discuss the big picture of Digital Transformation and all of the strategies, tactics, and tools they need to realize their goals. Sponsors of DXWorldEXPO | CloudEXPO benefit from unmatched branding, profile building and lead generation opportunities.
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
"MobiDev is a software development company and we do complex, custom software development for everybody from entrepreneurs to large enterprises," explained Alan Winters, U.S. Head of Business Development at MobiDev, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
JETRO showcased Japan Digital Transformation Pavilion at SYS-CON's 21st International Cloud Expo® at the Santa Clara Convention Center in Santa Clara, CA. The Japan External Trade Organization (JETRO) is a non-profit organization that provides business support services to companies expanding to Japan. With the support of JETRO's dedicated staff, clients can incorporate their business; receive visa, immigration, and HR support; find dedicated office space; identify local government subsidies; get...
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.
Bill Schmarzo, author of "Big Data: Understanding How Data Powers Big Business" and "Big Data MBA: Driving Business Strategies with Data Science," is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He's written several white papers, is an avid blogge...
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, added the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining sensor analytic...
Bill Schmarzo, author of "Big Data: Understanding How Data Powers Big Business" and "Big Data MBA: Driving Business Strategies with Data Science," is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He's written several white papers, is an avid blogge...
Charles Araujo is an industry analyst, internationally recognized authority on the Digital Enterprise and author of The Quantum Age of IT: Why Everything You Know About IT is About to Change. As Principal Analyst with Intellyx, he writes, speaks and advises organizations on how to navigate through this time of disruption. He is also the founder of The Institute for Digital Transformation and a sought after keynote speaker. He has been a regular contributor to both InformationWeek and CIO Insight...
Michael Maximilien, better known as max or Dr. Max, is a computer scientist with IBM. At IBM Research Triangle Park, he was a principal engineer for the worldwide industry point-of-sale standard: JavaPOS. At IBM Research, some highlights include pioneering research on semantic Web services, mashups, and cloud computing, and platform-as-a-service. He joined the IBM Cloud Labs in 2014 and works closely with Pivotal Inc., to help make the Cloud Found the best PaaS.
It is of utmost importance for the future success of WebRTC to ensure that interoperability is operational between web browsers and any WebRTC-compliant client. To be guaranteed as operational and effective, interoperability must be tested extensively by establishing WebRTC data and media connections between different web browsers running on different devices and operating systems. In his session at WebRTC Summit at @ThingsExpo, Dr. Alex Gouaillard, CEO and Founder of CoSMo Software, presented ...
I think DevOps is now a rambunctious teenager - it's starting to get a mind of its own, wanting to get its own things but it still needs some adult supervision," explained Thomas Hooker, VP of marketing at CollabNet, in this SYS-CON.tv interview at DevOps Summit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.