Water utilities are increasingly outsourcing noncore business functions as a way to boost efficiency and economy. Service level agreements (SLAs) with vendors are a key component of successful outsourcing and, ultimately, enhanced customer care. However, creating and implementing a comprehensive and cohesive SLA are complicated processes, especially for utilities with little or no experience in outsourcing critical functions. This article offers ten strategies for developing and executing SLAs that will help utilities meet their objectives. Key performance indicators, expectations, and the process for measuring results should be clearly but not overly defined. In addition, a good SLA builds in incentives, regular reviews, benchmarking provisions, and requirements for employee training and documentation. Utilities need to view the vendor partner as an extension of their organizations in order to establish a partnership that works for both utility personnel and the customers they serve. The SLA is the cornerstone on which successful outsourcing is built. A good SLA can help protect a water utility from misunderstandings, poor vendor performance, a failed partnership, and disgruntled consumers.
