Ensuring Service Quality: Key Components of a Strong Managed Services Agreement

Two businessmen in suits going over a managed services agreement

An MSA is a managed services agreement, a standard service contract when businesses outsource a managed IT service to a third-party company. It is imperative that these contracts are carefully drafted, reviewed, and redlined by all parties.

If your company has a legal counsel, this document is typically reviewed by them; however, legal counsel is not always aware of the nuances of IT infrastructure, so this is undoubtedly a service contract that should be collaboratively evaluated.

The list below is by no means exhaustive, but these key points should assist with the initial guidelines for executing a managed services contract that safeguards your company’s rights.

1. Scope of Services

Starting with the most logical step, in order to build a strong MSA, one of the most important aspects of an MSA is a very definitive and clear scope of services.

Think of this part of the MSA as “success criteria” for the third-party company to achieve and for your business to hold them to delivery of.

If necessary, specifically call out things that are not included to ensure that there are absolutely no misunderstandings.

Another good idea is to brainstorm with your MSP (Managed Service Provider) to understand what could be included within this scope and generate the scope of managed IT services together.

2. SLAs

SLA stands for service level agreement. This is another vital part of your contract with your MSP. It is imperative that the response times for outages, trouble tickets, and general issues are clearly documented within the MSA. Not including these would leave your business very vulnerable to poor service from your MSP.

Be aware that increasing response times can often increase the cost of your MSP contract, as there are cost increases for that managed services provider to respond within a critical window.

“Critical window” is another term to familiarize yourself with, as this is the response time expected of the MSP for an urgent system failure that might result in your business operations halting.

3. Roles and Responsibilities

Again, similar to the scope of services, it is important to define any and all responsibilities that each party has. This exercise might seem a little excessive but it eliminates any gray area in the MSA that might cause an issue in the future.

An example of this could be that your MSP is contractually obligated to carry out a site visit for an audit/inspection of some kind, however, the roles and responsibilities do not outline which party’s role it is to schedule or calendar this assessment.

Logically, it would be assumed it is the role of the MSP to do this, but without clear stipulation within the MSA, it allows vulnerability.

4. Service Hours and Support

Much like the SLA guidelines for outages and critical windows,  it is important to understand the service hours of your MSP.

Many businesses operate 24/7, so if your night shift experiences technical issues, you would want your MSPs hours to mirror your production hours to offer support when needed.

Another good idea is to understand if there are additional uplifts regarding cost per hour for after-hours support.

Man tracking reporting metrics on his laptop

5. Performance Metrics and Reporting

Another vital factor of an MSP’s role is to provide your company with KPI (key performance indicator) metrics regarding your network and infrastructure so you can ensure that the systems in place are performing as they should.

It is very important to outline how many reports you will receive (quarterly, every six months, or annually), what data it will include, and in which format these reports will be placed in. All of these factors are ones that can be negotiated with your MSP and can be perfectly tailored to meet your needs.

6. Escalation Process

When businesses execute MSAs, especially ones that cover multiple years, unfortunately, there are often issues at some point over the years.

It is imperative that you have a path to escalate issues and that all POCs (points of contact) are updated as their staff changes throughout the contract.

A good MSA should include a neutral email address that never changes. The escalation process should be outlined in the termination and non-performance section, which this article will elaborate on in more detail below.

7. Term and Termination

A part of any MSA is the effective date, duration of the contract, payment terms, how it ends, and early termination clause. As touched on within escalation, it is vital to have a termination for cause section, in which contracts can be canceled at the non-performance of the MSP.

This section needs to outline the warnings, calls to improve, written notice, and due process in order to legally terminate.

Other factors need to be considered in this section, too, for example, a confidentiality agreement and intellectual property once a contract is over to cover how data and confidential information are relayed with the POC or handed over to another company. It would also be prudent to involve a section here on dispute resolution.

8. Disaster Recovery

Although never fun to plan for or think about, it is of the utmost importance that businesses are prepared for adverse weather conditions and have a plan in place in the event of a disaster.

MSPs are obligated to ensure that businesses have the most possible uptime and have steps in place to resume business operations in the face of an emergency.

Hopefully, this article has helped you consider just some of the most important aspects of a strong managed service.

Once you are ready to proceed with evaluating the services of an MSP, please schedule a call with one of our experienced agents to discuss how we can support your infrastructure maintenance, planned upgrades—and future technology roadmap.