When in Cloud, Follow the Right SLAs

The burgeoning number of IT services delivered by cloud computing has presented an important business case of Cloud SLAs (Service Level Agreements). Organizations have used SLAs for a long time. However, cloud computing presents a significant shift from the way IT solutions have been implemented in the past and presents its own unique contract issues and challenges. CIOs across industries believe that an end-to-end performance visibility and robust SLAs are key to achieving good return on investment from cloud computing.

According to a survey conducted by Ipanema, 78 percent of the cloud providers are chosen by IT executives based on the quality of their SLAs. Gartner also recommends that an institution considering cloud computing "understand the detailed terms and conditions and the risks of signing the service provider's standard contract" before moving to a cloud computing solution. The Cloud Standards Customer Council (CSCC) recently published the Practical Guide to Service Level Agreements (SLA), suggesting steps on how to construct a cloud SLA that meets the cloud consumer's business requirements.

SLAs are critical to setting expectations for the service levels between the cloud consumer and the cloud provider. An ideal SLA is one which both the cloud consumer and provider can understand and agree to, including an exit strategy. The key focus of the SLA should be carefully reviewed, evaluated and measured before being closed as an agreement. SLAs provide CIOs an effective tool to manage and develop their relationship with the concerned service partners and businesses.

According to industry experts, an SLA with a cloud service provider should include a prominent mention of specific parameters and minimum levels required for each element of the service, as well as remedies for failure to meet those requirements. The contract should affirm an institution's ownership of its data stored on the service provider's system and clearly state the rights to get it back. Key to any SLA is the security clause which must detail the system infrastructure and security standards to be maintained by the service provider in addition to framing the rights to audit the compliance. Last but not the least, a cloud SLA must specify the cost involved to continue or discontinue the service.

As IT decision makers evaluate and compare SLAs from cloud computing providers, it is important that they clearly understand what is critical and will be required for the business in the future, since cloud SLAs continue to be complex and are still emerging.

About the Author

Wipro Insights set up the Council for Industry Research, comprising of domain and technology experts from the organization, to address the needs of customers. It specifically looks at innovative strategies that will help them gain competitive advantage in the market. The Council in collaboration with leading academic institutions and industry bodies studies market trends to equip organizations with insights that facilitate their IT and business strategies. http://www.wipro.com/insights/

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