636 Part IV • The Information Management System
EXHIBIT 1 SLA for Help Desk Problem Resolution by Vendor
different service levels were contracted for each severity
level with the vendor, depending on the business impact
and vendor costs.
There are hundreds of different pieces of hardware.
We’d say, “this group of servers is absolutely critical so
we’re going to call those ‘gold.’ This group of servers is
important so we’ll call those ‘silvers,’ and this group of
servers is used for application development, so we’re
going to call those ‘bronze.’” We then set levels of serv-
ice and we defined the SLA based on level of service.
—Alan HardingFor example, 80 percent of Severity 1 help desk
issues had to be resolved in less than four hours, but
80 percent of Severity 3 issues had to be resolved within
three business days (see Exhibit 1). Compliance statis-
tics for all the SLAs in the contract were tracked and
reported by the vendor during monthly meetings with
Schaeffer. Noncompliance with an SLA would result in
explicit financial penalties for the vendor. While negoti-
ating the contract, Schaeffer also had to make some com-
promises with respect to service levels, to keep costs
within current budget levels. For example, Schaeffer
chose a longer response time for Severity 1 help desk
issues because management thought the benefits of a
quicker response than four hours would not warrant the
vendor’s higher costs.
The Transition Period
After the outsourcing contract was signed, there was an
official six-month transition period as ABC took over
Schaeffer’s IT operations. A few key subject matter experts
(SMEs) were retained by Schaeffer to help manage the out-
sourcing arrangement, but most of the IT personnel (about
50) in infrastructure support positions at Schaeffer were
moved to ABC. By this time, only about a dozen IT person-
nel had to find other jobs because many had already done so
in the months prior to the contract bidding and negotiation
processes.
During the transition process, Schaeffer provided
ABC with extensive documentation, access to all relevant
computer systems, and information about IT processes
already in place During the transition period, none of the
SLAs were in effect, which meant that ABC could perfect
their processes during this time frame to match the SLAs.
The Schaeffer employees that were transferred to ABC
provided invaluable technical and business knowledge
about Schaeffer’s operational environment:When we brought ABC on board, we were very open
with them. We gave them everything—including our
help desk scripts—to get them up to speed.
—Rusty Evans, IT Director, Colbert divisionOn the flip side, however, the transition affected
every remaining IT employee at Schaeffer, because their
processes and workflows changed dramatically.Transitioning to any outsourcing provider in the first
six months is about the most painful process you can
possibly imagine because every process is changing
for every individual. You’ve got the people kept at
Schaeffer: all their processes are changing. You’ve
got the people who were at Schaeffer who went to
ABC in the deal: They’re probably not that thrilled
and they have to deal with their own personal issues
after just kind of getting “thrown over the wall.” And
then you’ve got ABC employees hitting the ground
who know technology, but don’t know anything
about us. So you’ve got these three groups all with
their own agendas, all with their own issues to deal
with, all trying to get to a single integrated process,
and it’s just hard. It’s just really hard.
—Alan HardingFacing the Challenges
The first couple years after the signing of the outsourc-
ing deal, several management challenges surfaced for
Schaeffer. Some of the underlying precontract differences
between the IT needs for Reitzel and the other two divi-
sions also resurfaced. These differences between the
divisions seemed to stem from the primary objective of
the outsourcing arrangement. The contract was written to
be flexible to accommodate growth: Outsourcing
provided the capability to scale up IT operations quickly,
so that Reitzel could pursue an aggressive series of
acquisitions and global expansion. The vendor’s technicalSeverity Level Service Level Agreement (SLA)
Severity 1 80% in 4 Hours; 95% in 24 Hours
Severity 2 80% in 8 Hours; 95% in 24 Hours
Severity 3 80% in 3 Business Days; 95% in 5
Business Days
Severity 4 80% in 5 Business Days; 95% in
15 Business Days