Third Party Thursday

JANUARY 2, 2020

5 Next Steps to Address Repeat Vendor SLA Failures

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When your vendor is repeatedly failing to meet the SLA requirements outlined in your contract, it can have negative consequences on your organization. Use the 5 steps covered in this podcast to help you navigate how to manage vendor SLA failures.

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Hi – my name is Josh with Venminder. joshua-cooper-headshot-CIRCLE

In this 90-second podcast, you’re going to learn about service level agreements (SLAs) and five next steps to take if you’re experiencing repeat vendor SLA failures.

Every day our team of certified paralegals assists clients of different industries and sizes with their contracts and SLA review process.

An SLA outlines the level of service the vendor will provide and is used as a measurement tool. Often, it’s included in the contract, but it can also be a stand-alone document. If a vendor is repeatedly failing to meet SLA requirements, here are five next steps we recommend you take:

  1. First, you should speak with the vendor about the issue. The best-case outcome is that you two can come to an agreement that will correct the SLA issue.

  2. Next, if attempted remediation of the SLA failures hasn’t resulted in correcting the issue, then notify senior management. They may need to review the contract for provisions that would allow for penalties or contract termination.

  3. Third, dig deeper into determining what was agreed to when the SLA was developed. Were penalties or termination clauses negotiated and included? If so, act on them. If not, you may have little to no options other than continuously asking the vendor to resolve the issues.

  4. Fourth, if able to move forward with termination, ask internal departments who should be involved for their input. For example, legal, the lines of business, senior management and the board may all have valuable insight regarding the impact the termination will have on your organization.

  5. Finally, request the legal department be the one to formally notify your vendor. They should notify of termination based on the provisions outlined within the agreement.

No one wants to be subject to SLA failures; however, sometimes that’s the case. Therefore, it’s important to understand what leverage you have when this happens.

Thanks for tuning in; catch you next time!


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